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OFFER AND ACCEPTANCE (L2 p.2) - Coggle Diagram
OFFER AND ACCEPTANCE (L2 p.2)
ACCEPTANCE
An offer is binding and if accepted = agreement or consensus ad idem, meeting of minds
This then fulfils the first main element of forming a contract
To have a contract we need offer and acceptance
Acceptance must be unequivocal and conform to the terms of the offer = mirror image rule
Acceptance must be communicated
Conduct will only amount to acceptance if it is clear that the offeree did the act in question with the intention of accepting the offer
The offeree must have knowledge of the offer when they accept. they cannot accidently accept an offer without knowing it exists; R v Clarke (1927) HC - reward for info leading to the arrest / conviction of murderer
RECEIPT RULE AND SILENCE
Entores Ltd v Miles Far East Corp (1955) 2 QB 327
Where parties are talking to each other (instantaneous communication) the acceptance must be heard to be communicated
Silence does not amount to acceptance, mere coincidence would not be enough
Acceptance must be communicated and received
Felthouse v Bindley (1862) 11 CN (NS) 86g
Offer cannot waive the need for communication and stipulate that silence will constitute acceptance
POSTAL RULE
BUT the Postel rule does not apply if
The terms of the offer are inconsistent with the Postal Rule, then it does not apply
The letter was sent to the wrong address, the postal rule does not apply; Korbetitis v Transgrain Shipping BV (2002) EWHC 1345
The postal rule only applies to a letter of acceptance, not a letter of revocation; Henthorn v Fraser (1892) and the postal rule only applies when reasonable to do so
The postal rule is not applicable if the offeror makes a unilateral offer (offer to the world) and acceptance takes place by performance of an act e.g.,' Carlill
Holwell Securities Ltd v Hughes (1974)
The offer can exclude the postal rule expressly by implication e.g., 'exercisable by notice in writing'
Adams v Lindsell (1818)
Is when the offeree sends thier acceptance by post, acceptance is completed when the letter is posted
An exception to the general rule that acceptance is valid upon receipt (receipt rule)
BATTLE OF THE FORMS
Each new set of terms amounts to a new offer - the court must decide
General principle - 'last shot'
In business, it is normal for parties to contract on their own standard terms, such as payment terms - whose terms have the parties contracted?
Butler Machine Tool Co v Ex-Cell-O Corp (1979)
C wishes to purchase machine from D; D sent quotation, including price variation and clause stating sellers' terms would prevail
C placed order with a letter containing conflicting terms and a slip requiring signature from C
SUMMARY
Offer = clear expression of willingness to enter into a contract
ITT = merely intention to enter into negotiation
Agreement = offer and acceptance (consensus ad idem; meeting of the minds)
Acceptance - must mirror the offer and must be clearly communicated, unless its unilateral offer or postal rule applies
For a contract there needs to be an unambiguous agreement between the parties