Please enable JavaScript.
Coggle requires JavaScript to display documents.
Agreement: offer and acceptance (Termination of an Offer (Revocation (must…
Agreement: offer and acceptance
Offer
expression of willingness to contract on certain terms with the intention that if accepted, it will become a binding contract
statement that if accepted, creates a contract
Invitation to treat
Invitation to make an offer
Offer can be converted into contract by acceptance while an invitation to treat cannot be accepted, because
a response to an invitation to treat may be an offer
a response to an offer is either acceptance or rejection
How to make a distinction?
• Is the statement clear, definitive and unambiguous?
• Is it complete?
Generally, the following are considered invitation to treat
Other areas of comparison: quotations, price lists, catalogues, auctions, tenders are classified invitations to treat
Display of goods for sale: invitation to treat, not an offer to sell (
Fisher v Bell (1961)
)
Advertisements (
Grainger v Gough (1896)
)
Quotations/price lists
Auctions (
Harris v Nickerson (1873)
)
Termination of an Offer
Lapse of time (between the offer being made and the offer being accepted)
An offer may have an expiry date – acceptance cannot take place after that date
In no expiry date is expressed, an offer will be deemed to have expired after a reasonable period of time
Ramsgate Victoria Hotel v Montefiore (1866)
Revocation
must happen before the acceptance has taken place
withdrawal of the offer by the offeror
even if the offer states that it will remain open for a certain period of time, the offeror still may revoke the offer before the expiry date, provided no consideration has been given
the revocation must be communicated to the offeree
Routledge v Grant (1828)
Rejection
Expressed
Implied
(by offeree making a counter-offer or a conditional acceptance)
Hyde v Wrench (1840)
Before performance (in unilateral contracts)
Once performance has started, offer cannot be retracted
Pavey and Matthews Pty Ltd v Paul (1987)
Offers made to the world at large must be also retracted to the world at large
Shuey v United States (1875)
Death
If the offeree dies, the offer is automatically terminated
If the offeror dies, the offer is terminated unless the offeree has accepted the offer before he knew of the offeror’s death (
Re Whelan (1897)
), but the validity of this acceptance depends upon the nature of the offer (
does it involve a personal or non-personal service?
)
Rules of acceptance
(
offer must be accepted to create a binding contract
)
In case of
unilateral contracts, acceptance is recognised to arise by performance
, without the need to communicate the acceptance
Billings v Arnott & Co (1945)
Must be communicated
Must be unqualified
and correspond exactly to the terms of the offer
Neale v Merret (1930)
Silence does not equate valid acceptance
, unless under the terms of already existing contractual agreement
Postal rule
(
Where an offer is accepted by post, acceptance takes place on the date, time and place of posting and not receipt. The postal rule does not apply to other forms of communication
)