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Assess the problems that arise through terminating and offer

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Introduction

Assess the problems that arise through terminating and offer There are six different ways in which an offer can be terminated, these method are, Acceptance, Rejection, Revocation, Lapse of time, Failure to comply with conditions and Death. Alongside these ways of terminating an offer come problems. The problems that can arise with some of these methods including counter offers being made, revocation of a unilateral offer and the postal rule can cause problems for acceptance and revocation. A counter offer is an offer which has been made in response to a previous offer made by the offeree to the offeror, usually during negotiations when putting together the final contract. By making a counter offer the first offer that was given now becomes void and the counter offer must now be accepted or rejected for it to be recognised as part of the contract. If the original offer has been rejected and another offer put forward in its place is also rejected then the original offer cannot then be accepted, there is no way of going back to the original offer as seen in Hyde v Wrench (1840) in which Wrench had offered to sell Hyde his farm for £1,000, but Hyde rejected this by making a counter-offer and saying he would pay £950. ...read more.

Middle

Byrne later received Tienhoven?s revocation, but by then it was too late because the acceptance had been sent before the letter of revocation and under the postal rule this meant that the letter of revocation was invalid as the acceptance letter was posted in advance of the revocation. This case shows how important communication and timings are. However in this case the offer could have been revoked by a third party as long as they were reliable, as in the case of Dickinson v Dodds (1876). The problem with a third party member revoking an offer is that they must be reliable in the eyes of both parties because any little detail that is wrong could create a huge mess. In the case of Errington v Errington & Woods (1952) the offer is being revoked whilst that offeree has already started to perform the offer. A father had brought a house for this son and he said that if they paid off the remaining mortgage debts they could have the house, they accepted this by paying the debts, however the father died before the offer was complete and other members of the family wanted the house so they tried to revoke the fathers offer but they could not because it was already half way completed and as long as the son managed to pay the debt off the house would be his. ...read more.

Conclusion

This is seen in Household Fire Insurance v Grant (1879) in which Grant had no idea that he had become a shareholder in the company because he never received his letter of acceptance as it had been lost in the post, so when that company went into liquidation grant was liable for some of that company yet he was unaware that he was. The courts said that it does not matter that he was unaware of the acceptance, but he was essentially a shareholder when that letter was posted to him. There are also flaws with modern methods of communication for example with telephones if nobody answers the phone and you leave a message it is your duty to find out if that person has received the message as you are the one wanting to make to contract, because if they do not receive that message they are not bound by anything, Lord Denning gave an example of this in Entores Ltd v Miles Far East Corporation (1955) by saying ?If a man shouts an offer to a man across a river but the reply is not heard because of a plane flying overhead, there is no contract. If he wishes to make a contract he must wait till the aircraft has passed and then shout back his acceptance so that the offeror can hear it.? : ...read more.

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