• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

Dealing with problems of offer and acceptance.

Extracts from this document...

Introduction

Contents 1. Introduction 2 2. Contractual effect of the advertisement 2 3. Offer by telephone by Rob 3 4. Rob's reply by letter 3 5. Sale to Sunita 4 6. Bibliography 5 1. Introduction In dealing with problems of offer and acceptance, the Courts have taken a strict approach, stating that there must be clear offer and acceptance in order to create a binding contract. As such, offers must be clear on their terms and capable of acceptance and can only be accepted on terms that mirror the offer, as established in the case of Gibson v Manchester City Council (1979) 1. There are dicta in certain cases, notably in the judgments of Lord Denning MR, which have attempted to mitigate this harsh approach, in the case of Butler Machine Tools Co Ltd v Ex-Cell-o Corporation (England) Ltd (1979)2. However, as Lord Denning's approach in the Court of Appeal was firmly rejected by the House of Lords in Gibson v Manchester City Council (1979)3, it is submitted that these dicta do not represent the current law. However, it is necessary to consider each communication that took place between the parties in this case, to see if the formalities of offer and acceptance have been fulfilled and if so, with whom the contracts exist with. ...read more.

Middle

The postal rule is reflected in the case of Adams v Lindsell7, where acceptance is deemed to have been effective at the instant, when Tom dropped the acceptance letter into the post box, provided it is properly addressed and adequately stamped. If the offeror takes the contractual risk of the letter being lost in the post, as stated in the case of Household Fire Insurance Co v Grant (1879)8. However, this depends upon the use of the postal service being reasonable, which was established by the case of Holwell Securities Ltd v Hughes (1974) 9. It is submitted that in this case, the use of the post is not reasonable, as Rob has always previously dealt with Tom by telephone. The contractual risk of the letter not arriving must therefore be deemed to fall on Tom, who therefore cannot rely upon the postal rule to create a binding contract. Additionally, even if the letter had arrived, there is also some doubt whether the terms of the letter can constitute an acceptance as the acceptance must mirror the offer as was stressed by the House of Lords in Gibson v Manchester City Council (1979)10. However, Tom was asking for payment by instalments. As such, this letter is potentially a counter-offer, capable of acceptance but not sufficient to create a binding contract. ...read more.

Conclusion

There is nothing specific by way of offer or rejection but a mere enquiry, which should have been answered.12 It is establishes that an enquiry over the terms of payment can equally be construed as an enquiry that should have been answered and not a counter-offer. 5. Sale to Sunita As the letter either has no contractual effect as acceptance was not communicated, or was a mere enquiry and not a counter-offer, it is submitted that Rob was not free to sell the car to Sunita when she made her contract on Wednesday morning. Rob knew that he had given Tom until Wednesday evening to accept his earlier offer over the car and so could not sell the car to another until Thursday. However, if Tom still wishes to purchase the car for �5,000 and can pay the money immediately, it is submitted that he can force Rob to sell the car to him. As the car is a vintage car, damages for breach of contract may not be an adequate remedy and may not even be calculable, so a court may order specific performance of the contract. Naturally, Rob would also be in breach of the implied term in his contract with Sunita, namely that he had good title to the car he was selling, as stated in the s12 of the Sale of Goods Act (1979) 17. He would also be liable for damages caused to her. WORDS: 1284 6. ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our AS and A Level Law of Contract section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related AS and A Level Law of Contract essays

  1. Marked by a teacher

    Contract Law - Acceptance.

    4 star(s)

    infact made a promise to continue with the payments until the mortgage was paid off, which means that the contract was unilateral. When the father later died, the people in charge of his affairs sought to withdraw the offer.

  2. Marked by a teacher

    Contract Law - Offer And Acceptance

    3 star(s)

    different situations where the role of objective test differ - B believe that A intends to be bound --- objective test - B knows that A has no intention --- x objective test - B has never thought about

  1. Invitation To Treat

    Answer to Question 3 This is a question involving technicalities in contract law, consideration, human rights and property law. It is axiomatic to recognize the fact that Peter has a legal obligation not to follow Mary deliberately (and she would almost be sure of invoking such a defence), but her

  2. Four ways in which a contract may be discharged.

    Pilkington v Wood [1953] 2 All ER 810. A house was conveyed with a defective title. The buyer's solicitor admitted negligence but he argued that the buyer should have mitigated his loss by taking proceedings against the seller. Held: The buyer was under no duty to take such proceedings.

  1. Definitions of Actus reus, mens rea & strict liability

    in the case of Latimer, where the defendant hit the first victim with his belt, however it recoiled off him, hit the second victim who was an innocent bystander and left him with several injuries.

  2. Contract law - Advise Sarah - The first thing to ascertain is whether the ...

    Acceptance would be effective on completion of the act specified in the advertisement. An offer can be defined as an expression of willingness to contract made with the intention that it shall become binding on the offeror as soon as it is accepted by the offeree.6 It is clear by

  1. I have been asked to advise a client on considering contracting with a building ...

    On 25th March the claimants signed the form. They sued the defendant for breach of contract. The defendant was not bound to take the car. His signing of the agreement was actually an offer to contract with the claimant. There was an implied condition in this offer that the car

  2. Postal Acceptance Rule

    In this case, clause 1 of an option agreement provided that " This option may be exercised by you by notice in writing addressed to me at any time on or before 20th December 1972. The plantiff posted a notice of exercise of the option addressed to the defendant on

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work