Offer and Acceptance, Certainty and Intention Revision Notes

- Contract needs offer and acceptance - But not all contracts can be analysed in this way

o Denning in Gibson: “it is a mistake to think that all contracts can be analysed into the form of offer and acceptance”

o Also, The Satanita = example of contract not possible to be analysed traditionally

o Offer and acceptance rules may be mechanical and divorced from reality

But do give us certainty OFFER:

- A statement objectively indicating that the offeror is prepared to contract on specific terms – must contain an express/implied promise

- May deny existence of contract by arguing offer invalid because: o (i) Mistakenly made o (ii) Not an offer at all o (iii) No longer valid at the time of purported acceptance

(i) Mistakenly made - Existence of offer depends on parties’ objective intentions - If party intended to be bound, likely to be offer; otherwise, simply

willingness to negotiate

(ii) Not an offer at all - Offer vs invitation to treat vs request for more info - Balance between protecting reasonable reliance and giving adequate

room to manoeuvre – must be able to spell out terms on which they are willing to contract without committing

- Harvey v Facey: o H said to F: will you sell pen? Telegraph lowest price o F said “lowest price = £900 o Held F envinced no intention to be bound so no contract

- Goods in stores = invitation to treat - PSGB v Boots:

o Self-service shop where medicine displayed on shelves o At till, sufficient pharmacist supervision o Held contract concluded at till; display = invitation to treat o Somervell LJ:

Inevitably shopkeeper accepts customer’s offer, but can’t say customer cannot change mind after he picks off shelf

Also, for alcohol, shopkeeper can refuse at till - Smith:

o Courts say display = invitation to treat as if shopkeeper got more acceptances than he could fulfil, he would be liable for goods he could not supply

But no problem for hotelier Also, why not have common sense limit: while stocks last?

o Court approach out of touch with modern society - No clear authority on whether website advert = offer or invitation to treat

o Probable analogy with display in shop window - Partridge v Crittenden:

o D placed adverts saying “birds, 25s each” o Held not guilty of “offering for sale” – advert = invitation to treat

- But some exceptional cases: o Chapelton v Barry UDC: display of deckchairs for hire with notice of

charges = offer; decision allowed court to keep harsh exclusion clause out of contract

o Carlill v Carbolic Smoke Ball - Carlill v Carbolic Smoke Ball:

o D advertised product, saying anyone who got flu while using it got £100

o Deposited £1000 in bank “to show sincerity” o C used ball and got flu o Entitled to damages – unilateral contract accepted by C’s conduct o Lindley LJ:

Clear not mere puff because of £1000 No problem that it was open-ended offer to anyone D waived requirement for notification of acceptance Acceptance by conduct

- Gibson v Manchester CC: o D Council said they may be prepared to sell to C tenant o D sent brochure asking tenants to make application o C submitted application but left price blank, wanting more info o D gave more info, and C said he was prepared to continue o Held D not committed to selling o “Application” was not meaning C could accept any offer o Diplock:

Denning wants to reject traditional approach and look at conduct as a whole to see if agreement

No reason for departing from traditional O & A here “May be prepared to sell”, and request for

“application” – clearly not offer - Blackpool & Fylde Aero Club:

o D sent invitation to tender to 7 parties, incl C o D said they would not accept tender received after deadline o C posted before deadline, but due to clerical error, D did not

receive until after deadline o D accepted lower offer than C’s o Bingham:

Stipulation that tenders received after deadline would not be considered implied obligation to consider tenders received before deadline

D need not accept highest tender, but C has contractual duty to be considered

Invitation to tender = offer Submission of conforming tender = acceptance

(iii) No longer valid at time of purported acceptance - Offer can be terminated in 3 ways:

o (i) Expiry If no time fixed, expires after reasonable time (Ramsgate

Victoria Hotel) o (ii) Rejection by offeree, e.g.: counter-offer

Hyde v Wench: Attempt to accept offer on new terms = rejection and

counter-offer, which kills initial offer D offered to sell for £1000 C offered to buy for £950 C then tried to accept £1000 No contract

Stevenson, Jacques & Co: Request for more info is not rejection and counter-

offer D offered iron to C C asked if it could be delivered in 2 months Held, C had not rejected D’s offer

o (iii) Revocation by offeror Byrne v Van Tienhoven:

Postal rule does not apply in revocation – while simply posting counts as acceptance, not so for revoking offer – must be received

Henthorn v Fraser: Postal acceptance only valid if reasonable for offeror

to expect acceptance by post ACCEPTANCE:

- H Beale: “must amount to a final and unqualified assent to the terms of the offer”

- Must coincide with terms of offer (Hyde v Wrench) - Brogden v Metropolitan Railway Co:

o M sent draft agreement for supply of coal o B amended and returned o M ordered from B, B supplied, and M paid o Held amendment = counter-offer, accepted by M’s conduct

- Butler Machine Tool Co v Ex-Cell-o Corp Ltd: o “Battle of the forms” o C offered to sell subject to Ts & Cs