Law of Contract - Law 103

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Law of Contract

Law 103

Assignment 1  ~  Seaburn Cycles

Gemma Bolt


A contract is a legally binding enforceable agreement between two or more parties.  Where an issue of a breach of contract arises in court, the court has to decide whether or not a contract has been made.  To do this they must establish whether an offer has been made or whether it was simply an invitation to treat.  If an offer has been made the courts must then look to establish whether there has been an acceptance.

An offer is a statement of willingness by one party to enter into a contract on certain terms made with the intention that it shall become binding on acceptance.  Whereas an invitation to treat is an expression of willingness to enter into negotiations which will eventually lead to a contract being formed.  Acceptance is an unqualified expression of assent to the terms of the contract proposed by the offeror.

The first thing to establish is whether an offer or an invitation to treat was made.  In this situation, following the case of Partridge v Crittenden [1968] 1 WLR 1204, the initial advertisement in the newspaper would constitute an invitation to treat.  However Jason then phoned three people and told them “the stock is yours if you can go to £25,000 by 6pm on the 23rd.  This would more than likely constitute to an offer which is open to acceptance as the offer was made with the intention of being bound by acceptance.  

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The second thing to consider is whether there has been any acceptance of this offer by anyone.  Julia sent a bid of £25,000 by fax to Jason accepting the offer at 5.30pm on the 23rd November.  By sending her to bid by fax Julia is accepting the offer however with instantaneous communication such as sending a fax, acceptance only take place when the acceptance is received by and brought to the attention of the offeror, this was expressed by Denning LJ in the case of Entores v Miles Far East Corp. [1955] 2 QBD 327, and it is received at the place ...

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