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Contract Law Formation Notes King's Notes

2444 words - 10 pages


I. Has an offer been made?

An offer, is a statement of willingness to enter a contract on negotiated terms (see Carlill v Carbolic Smoke Ball Co)

Or, is there an invitation to treat?
>> An offer must be distinguished form an ?invitation to treat? or an invitation for others to make offers

>> Examples of invitations to treat include:
? Advertisements
>> Unless they constitute a reward (see Carlill V Carbolic Smoke Ball Co)

o Goods in a shop window (see Fisher v Bell)
>> ?Choosing goods in a shop window is not an acceptance of an offer to sell but an offer made by the customer to buy? (see Pharmaceutical
Society v Boots Cash Chemists)

? Tenders (see Spencer v Harding)
>> However, if the request for tenders specifies the tenderor will accept the lowest or highest tender, the tender will constitute an offer to enter into a unilateral contract, where acceptance takes place on the accepting of the highest or lowest tender

? Auctions with reserve prices ? auctioneer invites others to make offers (an invitation to treat), the highest offer of which is accepted by the fall of the hammer
>> Where there is no reserve price, the auctioneer makes a unilateral offer to sell goods, which is accepted by the highest bidder (see Barry v Davies)

>> Where there is an invitation to treat there can be no enforceable contract

II. If there is an offer, has there been valid acceptance?

1.) Has a counter offer been made?
? The terms of acceptance must match the terms of the offer, otherwise the offeree has made a counter-offer. (see Hyde v Wrench)
? Cannot introduce new terms
? Counter offer destroys initial offer, so no longer can be accepted
-However counter offer can actually simply be request for information

2.) Has acceptance taken place through conduct?
? Acceptance may take place through the conduct of the offeree (see Brogden v Metropolitan Railway and Butler Machine Tool v Ex-cell-o Co)
? This can occur by performing the contract without objecting to terms

3.) Is there a prescribed method of acceptance?
? A prescribed method of acceptance will not be the only method of acceptance where other methods of acceptance, which differ from the prescribed method, are no less expedient (see Manchester Diocesan Council for Education v CGI Ltd.)
? Prescribed method of acceptance must be expressly stated as necessary

4.) Has a cross-offer been made?
? Where two parties make offers to one another at the same time, but are ignorant of this fact.
? No binding contract will be created if neither party accept the offer of the other (see Tinn v Hoffman)
5.) Is there evidence of knowledge/reliance on an offer?
? One cannot be party to a contract i.e. accept an offer, if they are ignorant of the offer (contrast Williams v Carwardine and R v Clarke)
? The motive is irrelevant so long as the offeree knows about the offer

6.) Is there a battle...

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