Offer

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  • Created on: 29-02-16 16:39

-Counter Offer (continued)

requesting more information - it must be clear that the CO changes the terms of the offer and rejects the offer, whereas a request for more info leaves the offer open.

STEVENSON v McLEAN:

the buyer responded to an offer to sell iron by asking whether credit terms were available. HELD asking whether credit terms were available was a request for more info and didnt constitute an offer or a CO

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-Refusal

Refusal

if the offeree refuses the offer, then the offer ends

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-Acceptance

Acceptance

when the offeree accepts the offer unconditionally then the offer ends and a contract is formed.

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Harris v Nickerson [1873]

P sued D for his expenses after travelling to an auction to discover that the item had been withdrawn from sale HELD there was no contract to hold the sale or to have individual items for sale on that day. this is no more than an advertisement for a sale which is to take place in a shop.

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7) Ways an offer can end

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-Lapse of time

Lapse of time - an offer can end either if it was open for a limited time or the time that has lapsed between the offer and the acceptance is not reasonable.

Ramsgate Victoria Hotel v Montefoire (1866) 

The defendant offered to purchase shares in the claimant company at a certain price. Six months later the claimant accepted this offer by which time the value of the shares had fallen. The defendant had not withdrawn the offer but refused to go through with the sale. The claimant brought an action for specific performance of the contract.

Held: 

The offer was no longer open as due to the nature of the subject matter of the contract the offer lapsed after a reasonable period of time. Therefore there was no contract and the claimant's action for specific performance was unsuccessful.

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-Death

Death - offers of apersonal nature will end if the offerordies Bradbury v Morgan. However if it is of a general nature it doesnt need to end since the offerors estate can honour it.

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-Failure of a precondition

an offer ends if a main term of the offer isnt fulfilled or is significantly altered

FINANCING LTD v STIMSON [1962]

D offered to sell a car and P agreed to buy it. in between and unknown to P the car was damaged. HELD although P had signed the agreement acceptance had not taken place as the precondition that the car would be in a certain condition had not been met.

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-Counter Offer (continued)

Machine Tool v Ex-Cell-O Corporation [1979]

Ex-Cell-O wished to purchase a machine from Butler. Butler sent out a quotation of £75,535 along with a copy of their standard terms of sale. The terms included a price variation clause and a term that the seller's terms would prevail over any terms submitted by a purchaser. The machine would be delivered in 10 months. Ex-Cell-O put in an order for the machine at the stated price and sent a set of their terms which did not include the price variation clause. The order contained an acknowledgement slip which required a signature by Butler and was to be returned to Ex-Cell-O. This slip stated that the contract would be subject to the terms stated overleaf. Butler duly signed the slip and returned it. The machines were then delivered and Butler sought to enforce the price variation clause and demanded an extra £2,893. Ex-Cell-O refused to pay.

Held:The offer to sell the machine on terms provided by Butler was destroyed by the counter offer made by Ex-Cell-O. Therefore the price variation clause was not part of the contract. The contract was concluded on Ex-Cell-O's terms since Butler signed the acknowledgement slip accepting those terms. Where there is a battle of the forms whereby each party submits their own terms the last shot rule applies whereby a contract is concluded on the terms submitted by the party who is the last to communicate those terms before performance of the contract commences.   

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-Counter Offer

Counter Offer

offeree replies with an offer, thus changing the elements of the original offer, which ends. there is no acceptance as the offeree isnt agreeing to all of the terms. the counter offer completely removes the oringial offer. if the counter offer is rejected by the offeror, then the offeree cannot go back to the original offer.

Hyde v Wrench (1840) 

The defendant offered to sell a farm to the claimant for £1,000. The claimant in reply offered £950 which the defendant refused. The claimant then sought to accept the original offer of £1,000. The defendant refused to sell to the claimant and the claimant brought an action for specific performance.

Held:

There was no contract. Where a counter offer is made this destroys the original offer so that it is no longer open to the offeree to accept.   Forms - he who fires last **** wins.   Butler Machine Tool v Ex-Cell-O Corporation [1979]

Ex-Cell-O wished to purchase a machine from Butler. Butler sent out a quotation of £75,535 along with a copy of their standard terms of sale. The terms included a price variation clause and a term that the seller's terms would prevail over any terms submitted by a purchaser. The machine would be delivered in 10 months. Ex-Cell-O put in an order for the machine at the stated price and sent a set of their terms which did not include the price variation clause. The order contained an acknowledgement slip which required a signature by Butler and was to be returned to Ex-Cell-O. This slip stated that the contract would be subject to the terms stated overleaf. Butler duly signed the slip and returned it. The machines were then delivered and Butler sought to enforce the price variation clause and demanded an extra £2,893. Ex-Cell-O refused to pay.

Held:

The offer to sell the machine on terms provided by Butler was destroyed by the counter offer made by Ex-Cell-O. Therefore the price variation clause was not part of the contract. The contract was concluded on Ex-Cell-O's terms since Butler signed the acknowledgement slip accepting those terms. Where there is a battle of the forms whereby each party submits their own terms the last shot rule applies whereby a contract is concluded on the terms submitted by the party who is the last to communicate those terms before performance of the contract commences.   

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-Revocation

courts dont allow the offeror to withdraw the offer when acceptance is an ongoing act. this is to protet the offeree, the weaker party, who would otherwise be disadvantaged. 

Errington v Errington Woods [1952]

A father-in-law purchased a house for his son and daughter-in-law to live in. The house was put in the father's name alone. He paid the deposit as a wedding gift and promised the couple that if they paid the mortgage instalments, the father would transfer the house to them. The father then became ill and died. The mother inherited the house. After the father's death the son went to live with his mother but the wife refused to live with the mother and continued to pay the mortgage instalments. The mother brought an action to remove the wife from the house.
Held:
The wife was entitled to remain in the house. The father had made the couple a unilateral offer. The wife was in course of performing the acceptance of the offer by continuing to meet the mortgage payments. Under normal contract principles an offer may be revoked at any time before acceptance takes place, however, with unilateral contracts acceptance takes place only on full performance. Lord Denning held that once performance had commenced the Mother was estopped from revoking the offer since it would be unconscionable for her to do so. Furthermore there was an intention to create legal relations despite it being a family agreement.

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-Revocation

unilateral contracts can be withdrawn effectivley by using the same method which the offer was made giving the same publicity. 

SHUEY v US [1875]

an offer of a reward had been succesfully revoked as long as it had been given the same notoriety as the original offer,

courts dont allow the offeror to withdraw the offer when acceptance is an ongoing act. this is to protet the offeree, the weaker party, who would otherwise be disadvantaged. 

 

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-Revocation

Revocation - offer is revoked before it is accepted

ROUTLEDGE v GRANT [1828]:

G offered his house for sale for a period of 6 weeks. before this time had passed, G tried to withdraw his offer. HELD that was fine as long as there had been no acceptance.

offer cant be revoked once accepted. 

BYRNE v VAN TIENHOVEN [1880]

D wrote to new york to cardiff offering to sell goods. when the offer was received acceptance was telegraphed to new york. however 3 days earlier d had written to withdraw the offer which didnt arrive until after acceptance had taken place; because the offere was unaware the offer had been revoked.

 

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-Revocation

effective revocation can come from a reliable third party. 

 Dickinson v Dodds (1876)  The defendant offered to sell his house to the claimant and promised to keep the offer open until Friday. On the Thursday the defendant accepted an offer from a third party to purchase the house. The defendant then asked a friend to tell the claimant that the offer was withdrawn.On hearing the news, the claimant went round to the claimant's house first thing Friday morning purporting to accept the offer. He then brought an action seeking specific performance of the contract.

Held:
The offer had been effectively revoked. Therefore no contract existed between the parties. There was no obligation to keep the offer open until Friday since the claimant had provided no consideration in exchange for the promise. 
The offeror is free to withdraw the offer at any time before acceptance takes place unless a deposit has been paid.
 

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6)Auctions

section 57 sale of goods act 1979 states that an advert to hold an auction is simply an invitation to treat to perspective buyers and not an offer.

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Lefkowitz [1957]

the store advertised a sale at 9am saturday; 3 fur coats worth $100 each for $1 - first come first served. on the day the seller refused to sell a coat to one of the first 3 customers as he was a man. HELD that as the man accepted the terms of the offer, he was entitled to the coat for $1.

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Bowerman v ABTA [1966]

a travel agents contained notices stating that it was covered by ABTA. it was held that even though customers did not expressly accept this in words, their acceptance of it was implied by their conduct which was booking a holiday with the travel agents.

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4) Invitation to treat

an ITT is not the same as an offer it is an invitation to customers to commence negotiations.

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Wilkie v London passenger Transport Board [1947]

on a bus journey, it was implied by the parties actions that a contract was formed

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3) Implied offers

arise as a result of conduct or circumstances

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2) Express offers

arise verbally or in writing. person accepting offer must know that they are actually agreeing to an offer. if not know, then there is nothing to accept

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Taylor v Laird [1856]

captain of a ship stepped down during the trip and went back to working as a normal member of the crew.. upon returning the man tried to claim wages form the owner of the ship, but the ship owner was unawrae of Taylors decision to quit as captain, he had not received an offer from Taylor to work in an alternative capacity. HELD: his claim failed because there was no express offer for laird to accept, so there was no binding contract

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Fisher v Bell [1961]



The defendant had a flick knife displayed in his shop window with a price tag on it. Statute made it a criminal offence to 'offer' such flick knives for sale. His conviction was quashed as goods on display in shops are not 'offers' in the technical sense but an invitation to treat. The court applied the literal rule of statutory interpretation.

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Harvey v Facey [1893]

Harvey sent a Telegram to Facey which stated: -

"Will you sell us Bumper Hall Pen? Telegraph lowest cash price-answer paid;" 

Facey replied by telegram:-

"Lowest price for Bumper Hall Pen £900."

Harvey then replied:-

"We agree to buy Bumper Hall Pen for the sum of nine hundred pounds asked by you. Please 
send us your title deed in order that we may get early possession." 

Held: 

The Privy Council held that there was no contract concluded between the parties. Facey had not directly answered the first question as to whether they would sell and the lowest price stated was merely responding to a request for information not an offer. There was thus no evidence of an intention that the telegram sent by Facey was to be an offer.

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5) Advertisements

not all adverts are classed as an invitation to treat, an advert may be classed as an offer if there are terms included in the advert that the customers have acted upon -- Carlill

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Partridge v Crittenden (1968)

The defendant placed an advert in a classified section of a magazine offering some bramble finches for sale. S.6 of the Protection of Birds Act 1954 made it an offence to offer such birds for sale. He was charged and convicted of the offence and appealed against his conviction.

Held:

The defendant's conviction was quashed. The advert was an invitation to treat not an offer. The literal rule of statutory interpretation was applied.

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Pharmaceutical Society of Great Britain v Boots [1

Boots introduced the then new self service system into their shops whereby customers would pick up goods from the shelf put them in their basket and then take them to the cash till to pay. The Pharmaceutical Society of Great Britain brought an action to determine the legality of the system with regard to the sale of pharmaceutical products which were required by law to be sold in the presence of a pharmacist. The court thus needed to determine where the contract came into existence.

Held:

Goods on the shelf constitute an invitation to treat not an offer. A customer takes the goods to the till and makes an offer to purchase. The shop assistant then chooses whether to accept the offer. The contract is therefore concluded at the till in the presence of a pharmacist.

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Gibson v Manchester CC

G enterd into negotiations with the council to buy his house after receiving a letter from them stating they may be prepared to sell the house to him. when G returned his form the council refused to sell. HELD the councils proposals was an invitation to treat. when gibson replied this was an offer which was rejected by the council. as a result there was no binding contratc for sale.

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1) Unilateral

general/ uniltareal - made to the 'whole world'

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Carlill v Carbolic Smoke Ball Co [1893] Court of A

  A Newspaper advert placed by the defendant stated:-£100 reward will be paid by the Carbolic Smoke Ball Company to any person who contracts the influenza after having used the ball three times daily for two weeks according to the printed directions supplied with each ball...£1000 is deposited with the Alliance Bank, shewing our sincerity in the matter."Mrs Carlill purchased some smoke balls and used them according to the directions and caught flu. She sought to claim the stated £100 reward.Held:The Court of Appeal held that Mrs Carlill was entitled to the reward as the advert constituted an offer of a unilateral contract which she had accepted by performing the conditions stated in the offer. The court rejected all the arguments put forward by the defendants for the following reasons:

1. The statement referring to the deposit of £1,000 demonstrated intent and therefore it was not a mere sales puff.
2. It is quite possible to make an offer to the world.
3. In unilateral contracts there is no requirement that the offeree communicates an intention to accept, since acceptance is through full performance.
4. Whilst there may be some ambiguity in the wording this was capable of being resolved by applying a reasonable time limit or confining it to only those who caught flu whilst still using the balls.
5. The defendants would have value in people using the balls even if they had not been purchased by them directly.

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