Offer and Acceptance Contract Law

12 Key excerpts on "Offer and Acceptance Contract Law"

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  Aspects of Civil Engineering Contract Procedure

  • R. J. Marks, R. J. E. Marks, R. E. Jackson(Authors)
  • 2013(Publication Date)
  • Pergamon

    (Publisher)

  LEGAL ASPECTS OF CONTRACTS Offer and Acceptance The Offer The basis of contract is agreement. Agreement is composed of an offer and an acceptance. In order to see whether a contract has been made the law looks to see whether one party has made an offer to do or refrain from doing something, and, if so, whether that offer has been accepted by the other party. The test which the law applies is an objective one: it looks at the parties' conduct, not their intentions. If one party makes a firm offer which is unequivocally accepted by the other, neither can afterwards contend that he did not intend to enter into a contract. 1 An offer, however, must be distinguished from a mere attempt to negotiate. The latter is called by lawyers an invitation to treat. An offer, if accepted, becomes a binding contract. An invitation to treat, on the other hand, is something which by its nature is incapable of being accepted or becoming binding without further negotiation. An invitation to tender sent by an employer to a number of contractors is generally an invitation to treat rather than an offer 2 , although it may be that by inserting words to the effect that the lowest tender will be accepted it might be turned into an offer capable of acceptance. It follows that the clause frequently inserted to the effect that the employer does not bind himself to accept the lowest or any tender is probably unnecessary. A document or something said by one of the parties may constitute an offer although the party putting it forward does not use the word offer. Estimates have frequently been these ways by inadvertence. The making of small sub-contracts by letter or by word of mouth is perhaps more common. 19 [ Falck v. Williams [1900] A.C. 176. 2 Moore v. Shawcross [1954] C.L.Y. 342. 20 CIVIL ENGINEERING: CONTRACT PROCEDURE held to be offers which become binding when accepted. 1 Whether or not a civil engineering contractor's tender is an offer depends upon its terms.

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  Commercial Contracts

  A Practical Guide to Deals, Contracts, Agreements and Promises

  • Chris Thorpe, John Bailey(Authors)
  • 1996(Publication Date)
  • Woodhead Publishing

    (Publisher)

  Entering into a contract Contract law textbooks usually begin with the principles of offer and acceptance and the requirement of consideration, and we must now consider these two subjects. The practical significance of these topics may not be immediately apparent, so let us begin with a brief explanation. An understanding of the principles of offer and acceptance will enable you, in most but not all situations, to identify the precise moment at which a contract comes into existence. The importance of being able to identify that moment precisely should be apparent, because this is the moment at which both parties are committed to the transaction. Before this moment either party is free to pull out of the transaction, but from this moment neither is free to do so. Consideration is a technical legal requirement for the formation of a valid contract. This requirement is supposedly the most dis-tinctive feature of English contract law and is a favourite academic topic, but in practice there are only a few commercial situations in which the requirement of consideration causes problems. But in these situations it is important to recognise that there is a problem, because otherwise the parties may enter into an agreement which is unenforceable. Once we have dealt with these two topics we can (as it were) get 39 Commercial contracts 3.1 Offer and acceptance The law considers that every contract comes into existence as a result of the acceptance of an offer. An offer made by one party is accepted by the other party (or parties), and a contract is formed at the moment of acceptance. In section 3.1.8 we will question whether every contract can be analysed in this way, but we must begin by understanding what these terms mean and by taking a close look at the process by which every contract supposedly comes into existence. 3.1.1 Offer An offer is a proposal which will result in a contract if the person to whom the proposal is made simply accepts it.

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  Optimize Contract Law

  • Kathrin Kuhnel-Fitchen, Tracey Hough(Authors)
  • 2017(Publication Date)
  • Routledge

    (Publisher)

  Revision objectives ? Understand the law Remember the details Reflect critically on areas of debate Contextualise Apply your skills and knowledge ? a ? ? ? Offer and Acceptance 1 Chapter Map Contract formation Acceptance Type of contract Offer Intention to create legal relations Invitation to treat Termination of offer Bilateral Unilateral Auctions/tenders Shop-window Website Self-service display Silence Acceptance Refusal Counter-offer Lapse of time Death Conduct When will acceptance take place? Communication Postal rule E commerce Counter-offer Domestic agreements Commercial transactions 4 Optimize Contract Law The main part of this chapter is devoted to offer and acceptance but intention to create legal relations will be covered briefly towards the end. Contract formation A contract will not come into existence until an agreement has been reached. The test for whether an agreement has been reached is an objective one. Based on external evidence, the court will consider at what point the reasonable man would conclude that an agreement has been reached and a contract created. The sub-jective intentions of the parties are not relevant. Lord Blackburn J in Smith v Hughes (1871) stated: ‘… if whatever a man’s real intention may be, he so conducts himself that a reasonable man would believe he was assenting to the terms proposed by the other party, and that other party upon that belief enters into a contract with him, the man thus conducting himself would be equally bound as if he had intended to agree to the other party’s terms.’ A contract is an exchange of promises that constitutes a legally binding agree-ment between two or more parties. Agreement is reached when an offer by one person (the offeror) to another (the offeree), that indicates the offeror’s willing-ness to enter into a contract on certain terms without further negotiations, is accepted by the offeree. The contracting parties can be individuals, groups or organisations.

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  Law

  Made Simple

  • D. L. A. Barker, C. F. Padfield(Authors)
  • 2014(Publication Date)
  • Made Simple

    (Publisher)

  3. Offer and Acceptance As already mentioned, to constitute a contract there must be an offer and an acceptance. The party making the offer is known as the offeror; the party to whom the offer is made is known as the offeree. The contract comes into existence when an offer has been uncondition-ally accepted. How made. An offer may be made orally, in writing or by conduct. An example of an offer made by conduct is where a customer in a super-market chooses goods and hands them to the cashier, who then accepts the customer's offer to buy. To Whom Made. An offer may be made to a definite person (or group of persons) or to the whole world, i.e. generally. Where an offer is made to one person only, or a group of persons, only that person or that group may accept. Where an offer is made to the whole world, anyone may accept by complying with the terms of the offer. Boulton v. Jones (1857). B bought a hose-pipe business from one Brocklehurst. /, the defendant, to whom Brocklehurst owed a debt, addressed an order to Brocklehurst for some piping. B supplied the order even though it was not addressed to him. J refused to pay B for the piping, and contended that he meant to deal with Brocklehurst only because he had a set-off (contra) account against Brocklehurst. Held: that the offer was made to Brocklehurst and that J was not liable to B for the goods as there was no contract. 'Now the rule of law is clear, that if you propose to make a contract with A, then B cannot substitute himself for A without your consent and to your disadvantage, securing to himself all the benefits of the contract' (Pollock, C.B.). Where a reward is offered to any person who does a certain thing, e.g. finding lost property, it follows that any person may accept. Providing the finder knows of the offer he may claim any reward for returning the property.

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  Unlocking Contract Law

  • Chris Turner(Author)
  • 2014(Publication Date)
  • Routledge

    (Publisher)

  2 Formation of a contract: Offer and acceptance AIMS AND OBJECTIVES After reading this chapter you should be able to:

    Understand the essential requirements for valid formation of a contract

    Understand the basic character of an offer

    Distinguish between an offer and an invitation to treat

    Understand the need for communication

    Understand how offers can be withdrawn and in what circumstances

    Understand how an offer can be terminated

    Understand the basic character of acceptance

    Distinguish between a counter-offer and a mere enquiry

    Understand the significance of different methods of communication

    Understand the circumstances in which unilateral contracts are made

    Critically analyse the area

    Apply the law to factual situations and reach conclusions

  2.1  Formation of contracts and the concept of agreement

  We know from our introduction to the law of contract that the law concerns ‘bargains’ that are made between parties. The major significance of the word ‘bargain’ is that it involves an agreement that is binding on both parties. In contract law, then, it is insufficient merely that an agreement exists between two parties but rather that it involves that specific type of agreement which is enforceable by both parties in a court of law.

  A contract is completed when both sides honour an agreement by carrying out their particular side of the bargain. It is a breach of contract when a party fails to do so.

  However, because of the special nature of contractual agreements, we cannot identify a breach of contract where we may feel that we have not got what we paid for or ‘bargained’ for, without first showing that the agreement was indeed a contract.

  So the first thing that may need to be determined in any contract case is that there is proof that a contract actually exists, as opposed to some less formal, and thus unenforceable, arrangement between the parties. It is possible to tell if the arrangement is a contract because to be so it must have been formed according to certain standard rules. These are the rules of formation of contract

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  Commonwealth Caribbean Contract Law

  • Gilbert Kodilinye, Maria Kodilinye(Authors)
  • 2013(Publication Date)
  • Routledge

    (Publisher)

  Chapter 2 Offer and Acceptance

  DOI: 10.4324/9780203488645-2

  The first requirement of a binding contract is that the parties should have reached agreement (a ‘consensus ad idem’). Normally, an agreement is made when one party (the ‘offeror’) makes an offer to another (the ‘offeree’) which the offeree accepts. For example, if R says to E in the presence of witnesses: ‘Will you buy my Suzuki car reg no XF 2244 for $10,000?’, and E replies, ‘Yes, I will’, a contract comes into being. In such a simple example, there is no difficulty in identifying the offer and the acceptance, but where the alleged agreement is preceded by protracted negotiations conducted in lengthy correspondence, it may be difficult to discover a precise offer and acceptance. In such a case, it would be necessary for the court to scrutinise the correspondence carefully in order to decide whether or not there was a concluded agreement.1

  1 Perry v Suffields Ltd[1916] 2 Ch 187; A Mahabir and Sons Ltd v Caroni (1975) Ltd (2002) High Court, Trinidad and Tobago, No S781 of 1997, unreported, per Tam J [Carilaw TT 2002 HC 35]. Speedy Service Liquors Ltd v Airports Authority of Trinidad and Tobago (2002) High Court, Trinidad and Tobago, Nos 586 and 936 of 1984, unreported [Carilaw TT 2002 HC 105] is an example of offer and acceptance arising from an exchange of letters between the parties.

  The Offer

  An offer has been described as ‘an expression of willingness to contract on certain terms made with the intention (actual or apparent) that it shall become binding as soon as it is accepted by the person to whom it is addressed’.2

  2 Treitel, Law of Contract, 12th edn (London: Sweet and Maxwell, 2007), para 2-002.

  An offer may be made to a particular individual or corporation, or to the world at large. In the above example, the offer to sell a Suzuki car was clearly addressed to an individual person, E, whereas an instance of an offer addressed to the world at large is the well- known case of Carlill v Carbolic Smoke Ball Co,3

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  Contract Law

  • Chris Turner(Author)
  • 2013(Publication Date)
  • Routledge

    (Publisher)

  6 Formation of a contract: agreement  Z 2.2 Offer 2.2.1 The character of an offer 1 A contract usually begins with acceptance of an offer. An offer is a state- ment by one party, the offeror (the person making the offer), identifying terms of an agreement by which (s)he is prepared to be bound if they are accepted by the offeree (the person to whom the offer is made). 2 Offer is straightforward if made in the form of a question: ‘Will you buy my law book for the price stated?’ – offeree responds positively and accepts or rejects the offer. 3 Not all contracts begin as simply. Often an offer is only made following an invitation to treat – passive conduct inviting the other party to make an offer, e.g. in diagram form: 4 There are numerous examples of invitation to treat.  O Auctions – the lot displayed is the invitation to treat, the individual bids are offers, the fall of the auctioneer’s hammer is acceptance ( British Car Auctions v Wright (1972)).  O Self-service shopping – display of goods is the invitation to treat, a customer then selects goods and makes an offer to buy at the OFFER to sell made by party A ACCEPTANCE of A’s offer by party В CONTRACT FORMED AT THIS POINT ACCEPTANCE of B’s offer by party A OFFER to buy made by party В INVITATION TO TREAT made by party A Offer 7 checkout, which is then accepted or not by the shopkeeper ( Pharmaceutical Society of Great Britain v Boots Cash Chemists Ltd (1953)).  O The same applies to goods displayed in shop windows ( Fisher v Bell (1961)) on whether display of a flick knife was unlawful under the Offensive Weapons Act.  O Advertisements – the advertisement is the invitation to which a person responds by making an offer to buy ( Partridge v Crittenden (1968)).  O Catalogues, as for auctions, so a lot can be withdrawn without any consequences ( Harris v Nickerson (1873)).  O Invitations to council tenants to buy their council houses and flats ( Gibson v Manchester City Council (1979)).

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  The German Law of Contract

  A Comparative Treatise

  • Basil S Markesinis, Hannes Unberath, Angus C Johnston(Authors)
  • 2006(Publication Date)
  • Hart Publishing

    (Publisher)

  These will be discussed in chapter 5, p 227. Though in theory the constituent elements of a contract, one declaration of inten- tion of each party, can easily be distinguished the one from the other, in practice it may be exceedingly difficult to analyse the formation of contract in such simple terms. As von Mehren has pointed out: ‘In real life, the contracting process is frequently more disorderly than the neat categories of negotiation, offer, and acceptance suggest.’ (Int Enc Comp Law VII, para 9-112.) He continued as follows (9-113): THE OFFER ( ANTRAG, ANGEBOT) 57 At one extreme, negotiation is absorbed by offer and acceptance; at the other, negotiation takes the form of a protracted exchange of information, a slow identification of party inter- ests and differences followed by a series of compromises that may ultimately result in tenta- tive agreement . . ., general agreement, when reached, may then be refined into a detailed contract. To reflect this phenomenon, some more recent approaches have indeed departed from the concepts of offer and acceptance. (See, for instance, UNIDROIT Principles, Article 2.1: ‘A contract may be concluded either by acceptance of an offer or by con- duct of the parties that is sufficient to show agreement.’ Cf Principles of European Contract Law, Article 2.211.) But the German Code is already one hundred years old and thus proceeds on the basis of traditional thinking namely, that offer and acceptance can and should be notionally separated. This traditional approach fits best the exchange of sequential written declarations of intention inter absentes. However, identifying a declaration which embodies all elements of an ‘offer’ may sometimes involve a fiction, as has been noted also by German writers. Nevertheless, in practice this difficulty does not result in any major problems.

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  Essential GCSE Law

  • Kenny Chin(Author)
  • 2014(Publication Date)
  • Routledge-Cavendish

    (Publisher)

  Contract law is categorised in the law of obligation. A contract creates a legal obligation between the contracting parties. When one party has not fulfilled, or is not going to fulfil the obligation, he can be sued for breach of contract. The court will help the innocent party by either ordering damages suffered to be compensated, compelling the party in breach to perform the contract (specific performance order) or prohibiting the wrongdoer to act in a way which would cause further breaches (injunction order). It is therefore important to know how and when a binding agreement has been created. The following are six main essentials for a contract to be formed, they are:

  • offer and acceptance;
  • consideration;
  • intention to create legal relationship;
  • capacity;
  • legality;
  • consensus ad idem (meeting of minds).

  For a contract to exist, the first three essentials have to be present. Without any of them, no contract has been formed in the first place. It is quite different when any of the latter three essentials is absent. If a party who lacks legal capacity, for example, a minor, makes a contract, the law recognises the contract, but may also intervene by giving the minor the option to avoid the contract. Therefore, the contract is not void, but is said to be voidable. If a contract is made with an illegal objective, the court will not enforce the contract, in other words, there is a contract, but it is unenforceable. When a person enters into a contract caused by fraud, misrepresentation, a serious mistake, duress or undue influence, there is, in effect, no meeting of minds. In some cases, the contracts are void and in others they may be voidable.

  Offer

  Sir Guenter Treitel in his book, The Law of Contract, defines an offer as an expression of willingness to contract on certain terms made with the intention that it shall become binding as soon as it is accepted by the person to whom it is addressed.

  There are further rules, mostly created by common law, relating to ‘offer’. These are: Offer must be communicated to the offeree

  An offer is an expression of willingness to contract and it must be expressed or communicated to a person, otherwise the person cannot accept something he is unaware of. For example, a reward has been offered for returning a lost item. If a person returns the item and, at the time, he does not know of the offer, then the offeror is not liable to reward him because he has not accepted anything and, therefore, there was no contract binding the parties.

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  Business Law and the Regulation of Business

  • Richard Mann, Barry Roberts(Authors)
  • 2019(Publication Date)
  • Cengage Learning EMEA

    (Publisher)

  Acceptance of an offer for a bilat- eral contract is some overt act by the offeree that mani- fests his assent to the terms of the offer, such as speaking or sending a letter, or using other explicit or implicit com- munication to the offeror. If the offer is for a unilateral contract, acceptance is the performance of the requested act with the intention of accepting. For example, if Joy publishes an offer of a reward to anyone who returns the diamond ring that she has lost (an offer to enter into a unilateral contract) and Bob, with knowledge of the offer, finds and returns the ring to Joy, Bob has accepted the offer. FIGURE 10-1 Duration of Revocable Offers Offer Effective Communicated Intent Definite and certain OFFER OPEN Offer Terminated Lapse of time Revocation Rejection Counteroffer Death Incompetency Destruction of subject Subsequent illegality No Offer No Offer 208 Contracts Part III COMMUNICATION OF ACCEPTANCE [10-3] General Rule [10-3a] Because acceptance is the manifestation of the offeree’s assent to the offer, it must necessarily be communicated to the offeror. This is the rule as to all offers to enter into bilateral contracts. In the case of unilateral offers, however, notice of acceptance to the offeror usually is not required. If, however, the offeree in a unilateral con- tract has reason to know that the offeror has no adequate means of learning of the offeree’s performance with rea- sonable promptness and certainty, then the offeree must make reasonable efforts to notify the offeror of accep- tance or lose the right to enforce the contract. Silence as Acceptance [10-3b] An offeree is generally under no legal duty to reply to an offer. Silence or inaction therefore does not indicate acceptance of the offer. By custom, usage, or course of dealing, however, the offeree’s silence or inaction may operate as an acceptance.

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  Law for Business and Personal Use, Copyright Update, 19th Student Edition

  • John Adamson, Amanda Morrison(Authors)
  • 2016(Publication Date)
  • Cengage Learning EMEA

    (Publisher)

  Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. 6-1 Creation of Offers 113 What Must Be in a Contract? Diaz, 16, contracted to sell his full drum set to his classmate Martin, also 16, for $450. They concluded their contract with a handshake in front of a couple of friends. If one of them later decides he does not want to go through with the deal, can the contract nonetheless be enforced in court against him? Why or why not? Because of its limited resources, the court system is very selective in what it will enforce. Criminal laws and laws allowing recovery for certain private inju-ries (torts) are highest on the list for enforcement as they are necessary for keeping peace in society. However, when it comes to contracts , generally defined as agreements between two or more par-ties that create obligations, the courts are far more selective. Requirements of a Legally Enforceable Contract In particular, there are six major requirements that must be satisfied before courts will treat a transaction as a legally enforceable contract. These are offer and acceptance, genuine assent, legality, consideration, capacity, and proper form. 1. OFFER AND ACCEPTANCE There must be an agreement composed of an offer and an acceptance upon which to base the contract. The person who makes the offer is termed the offeror . The person to whom it is made is the offeree . The terms of the offer must be definite and accepted without change by the party to whom it was intended to be offered. 2. GENUINE ASSENT The agreement must not be based on one party’s deceiving another, on an important mistake, or on the use of unfair pressure exerted to obtain the offer or acceptance. 3. LEGALITY What the parties agree to must be legal. An agreement to commit a crime or tort cannot be a legally enforceable contract.

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  Essentials of Contract Law

  • Martin Frey(Author)
  • 2015(Publication Date)
  • Cengage Learning EMEA

    (Publisher)

  Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. 50 CHAPTER 2 THE ACCEPTANCE An acceptance is the offeree’s manifestation of a willingness to enter into a contract on the offeror’s terms (see Exhibit 2-5). EXHIBIT 2-5 Step Two: Contract Formation—The Acceptance Step One Choice of Dispute Resolution Choice of Venue Choice of Law Step Two Contract Formation offer acceptance a contract is formed Step Three Contract Enforceability Step Four The Plaintiff’s Allegation of the Defendant’s Breach Step Five The Defendant’s Response to the Plaintiff’s Allegation of Breach no acceptance, no contract, no breach of contract cause of action and no restitution cause of action Step Six The Plaintiff’s Remedies for the Defendant’s Breach As was the case with the offer, the acceptance has three elements: • the offeree’s promise or performance • the consideration for the offeree’s promise or performance (i.e., the offeror’s promise) • the fact that the offeree is making his or her promise or performance to capture the offeror’s promise (see Exhibits 2-6 and 2-7). consideration for the offeree’s promise or performance What the offeree is seeking in return for his or her promise or performance. Copyright 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.

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