The offer must be accepted without modifications, otherwise it is a counter-offer. Where the method of acceptance is not prescribed, the method used should be the method used in making the offer. 75. His nephew intended to sell him the horse however, it was mistakenly auctioned. The doctrine of offer and acceptance has proved to be a viable and flexible tool to assess contract formation. In the case of General George Innih vs Ferado Agro Consortiums Ltd, The appellant offered to sell some properties to the plaintiff provided acceptance was within three days. 1. Specific performance sought by claimants. This was irrespective of the fact that the respondent said it accepted the offer. S was offered an option to purchase the freehold of a property at a price that requires the agreement of two surveyors, one appointed by each party. Acceptance proceeds an offer as the second requirement for a legally binding contract. However, in the United States case of Dick vs Us there was an acceptance by post that was revoked by telegram. This is due to the fact that someone can’t accept something which he has no knowledge of. ELEMENTS OF CONTRACT OFFER AND ACCEPTANCE Definition Offer / Proposal Offer + Acceptance = Agreement Section 2(a) CA 1950 : “ A proposal is made when one person signifies to another his willingness to do or to abstain from doing anything, with a view to obtaining of that other to such act or abstinence”. Additionally, requiring O for £100 to trade in old van. You can simply define acceptance as the unqualified concession to the terms of an offer as conveyed by the offeror. Where it would produce manifest absurdity and inconvenience. In the case of Entores vs Miles Far East co, Lord Denning held that an acceptance validly takes place where it is received not where it is posted. The court held that there was no valid contract between the plaintiff and his nephew due to the fact that the acceptance had no external manifestation, thus, it was invalid. No binding contract because no offer capable of acceptance had been made. A mere acknowledgement of receipt of the offer or a request for further information in relation to its terms, will not generally be sufficient to constitute acceptance. 4. The court held that this was an impossibility due to the absence of consensus ad idem between both parties. Tenders were sought from a small number of firms. There are several rules regarding the acceptance of an offer to enter into a contract: The acceptance must be communicated. 5. Agreement stated that S must supply a van at an agreed price (£286) on “hire-purchase terms” for two years. On appeal, the court of appeal ruled that the introduction of a new term was a counter offer. Page 6 Law for Business & Personal Use Adamson-Mietus, 2000 Pages 98-109 revocation removal of an offer before acceptance Modification or revocation is not effective until it is communicated to the offeree or received at the offeree’s mailing address. Acceptance can be expressed by means of a statement, express or implied, or by conduct (art. If the terms of the agreement are not the same, this will essentially be a counter-offer and no valid contract will be created. Newspaper advertisement is an invitation to treat, not an offer for sale. The House of Lords held that in the absence of any other evidence of the details of the hire purchase agree… Fisher v Bell [1961] 1 QB 394 < Complete Case Analysis >, Pharmaceutical Society of Great Britain v Boots [1953] EWCA Civ 6 <>, Partridge v Crittenden [1968] 2 All ER 421 <>, Carlill V Carbolic Smoke Ball Co [1892] EWCA Civ 1, Thornton v Shoe Lane Parking [1970] EWCA Civ 2. Thus, it can be safe to conclude that the Nigerian decision overrules the foreign decision. The elements of acceptance in contract law are those elements that make up the valid acceptance of a contract's terms. In contract law, acceptance is an unqualified expression of agreement to all the terms set out in the offer. However, Nnaemeka Agu JSC added that if all the basic terms to the contract have been agreed upon, the insertion of ambiguous words was just mere “cosmetic surplussage.”. L specifically requests that the method of reply must be by post. Claim in conversion by uncle F against auctioneer. Thus, if an offer is oral, acceptance should be oral. 3.The agreement must be certain. It is the willingness of one party to enter into a contract with another party according to the terms set out by the offering party. Acceptance of an offer under Dutch contract law. In this case, the defendant offered to buy shares in the company and it accepted by post. The Concept of Acceptance in Contract Law. Acceptance must generally be made in the manner specified by the offer. Topic 2 – The Law of Contract: Offer and Acceptance Introduction Contracts are the very hub of commercial life People and organisations enter into contracts virtually every day; when they purchase the daily necessities of life or larger consumer item, buy or lease property, borrow money, buy goods off eBay Acceptance occurred by performing the contract without any complaints towards the terms of the contract. Section 2(a)defines a proposal as “when one person signifies to another his willingness to do or abstain from doing anything, with a view of obtaining the assent of that other to such act or abstinence, he is said to make a proposal.” The person who makes the proposal is c… It is not clear if this would be acceptable in an acceptance by post. In the case of Tinn vs Hoffman & co, there were two simultaneous offers by both parties which had identical terms. What happens if the other party’s reaction does not match the offer exactly? Here is a case “Felthouse v Bindley (1862)” which is about accepting an offer properly. The burning issue then is which of the decisions is binding. However, the appellant later rescinded from the agreement. Acceptance must be judged objectively, but can either be expressly stated or implied by the offeree's conduct. However, in the United States case of Dick vs Us there was an acceptance by post that was revoked by telegram. Definition. It can be defined as the instance in contractual formation where the parties’ intentions as to the terms of the contract are the same or unequivocal. Intention is the key for an offer to be established. The court, in applying the decision in Adams vs Lindsell held that the letter of acceptance was valid even though it didn’t get to the defendant. There are several rules dealing with the communication of acceptance: The acceptance must be communicated. The House of Lords held that a valid contact had arisen even though there being no communication of acceptance. An example of this was provided in the case of. According to English Law, the acceptance of an offer is completed as soon as it is posted and cannot be revoked. Defendant had no right to impose conditions on the contract which were not stated in the ad. When one party responds to an offer with additional conditions or qualifications, the response is generally considered to be a counteroffer, not an acceptance. The request was however headed “subject to contract”. This decision was applied in the case of Household Fire insurance Co vs Grant. The claimant Felthouse wanted to buy a horse from his nephew for $30. Where the offer expressly states that acceptance by post has to reach the offeror. Negotiations between uncle and nephew resale of n’s horse. n. 1) receiving something from another with the intent to keep it, and showing that this was based on a previous agreement. Significance of the criminal element in this case – the avoidance of harsh penalties. Thus, if an acceptance is posted in Nigeria it becomes valid when it is received in America.Therefore acceptance is valid at the moment of acceptance. Proposal is an offer.It can be a promise, an act or abstinence. Thus, the defendant was held liable. Held: No valid contract. HS send an acceptance by mail which was nerver received by Dr H. ISSUE: whether postal rule can apply to this case? In this case, the offeree simply doesn’t communicate the acceptance to the offeror. C drove to the entrance of a garage and took a ticket from the machine; he then entered the car park and parked. You may do away with the requirement of communicating the acceptance; sometimes this may be obvious from the construction of the contract. Assent to the terms of an offer.. Offer is made by the customer bringing goods up to the till (cash register), not picking an item off the shelf. Generally, an acceptance which is not by post can be revoked if the revocation reaches the offeror before the acceptance does. In the case of Carlill vs Carbolic Smokeball Co it was held that in unilateral contracts the communication of acceptance is implicitly done away with. Save my name, email, and website in this browser for the next time I comment. In contract law, the acceptance of the offer takes place, when any letter accepting an offer is posted, not when it arrives. In Scammell v Ouston(1941), for example, the parties had agreed to the supply of a lorry on ‘hire purchase terms’. The provisions of the English legal system would be considered then the provisions of the Nigerian legal system would also be examined. In order to really understand the meaning of communication of acceptance, we should consider the following: A pertinent question to ask is “where does acceptance take place?”. 3. Because no communication occurred between the parties no valid contract had arisen. 2. To count as an acceptance, the other party’s reaction to the offer must amount to a clear, unequivocal, unqualified statement that the former accepts on exactly the terms of the offeror’s offer (the so-called “mirror image” principle). Significance of deposit as indicative of seriousness of offer. The respondent sued for breach of contract. ISSUE: whether a contract has been created and if the answer is yes on who terms? There must be communication of acceptance from the offeree's side. Another issue to be considered is what happens if the method of acceptance is prescribed. An acceptance is that, a concluding and incompetent expression of consent to the terms of an offer. In the case of. This has led to the general rule on advertisements. The display of goods on a supermarket’s shelves was merely an invitation to make offers to buy. Acceptance occurs when an offeree agrees to be mutually bound to the terms of the contract by giving consideration, or something of value like money, to seal the deal. However, the Supreme Court overturned the judgement. There were absolute conditions governing submission of tenders in a formal process. If offer is written, acceptance should also be written. Even though the parties may have appeared to make an agreement by the exchange of a matching offer and acceptance, the courts may refuse to enforce it if there appears to be uncertainty about what has been agreed, or if some important aspect of the agreement is left open to be decided later. He resisted paying the money and was thus sued to court. In this situation, an act is done which coincides with a unilateral offer of reward. In order to form a binding contract , there must one party (, making an offer which is accepted by another party (. Wins on a collateral contract between bidder and auctioneer. Sections 4 and 5 of Indian Contract Act deals with the acceptance and revocation of acceptance by post. Option contracts are generally found when dealing in securities, commodities, or real estate. The Indian Contract Act 1872 defines acceptance in Section 2 (b)as “When the person to whom the proposal is made signifies his assent thereto, the offer is said to be accepted. An offer needs to be distinguished from an invitation to treat. It is not clear if this would be acceptable in an acceptance by post. Hogera kwa kuwa na moyo wa kutamani watu wajifunze kupitia kile ambacho wewe unafaham. The respondent replied that it ‘accepted’ the offer but it asked for an extension of two weeks. A counter offer happens when offeree introduces a new term to the initial offer of the offeror. You can also define acceptance as an offeree’s assent, either by express act or by implication from conduct, to the terms of an offer in a manner authorized or requested by the offeror, so that a binding contract is formed. The offer and acceptance must be based or founded on three components, that is, certainty, commitment and communication. The terms in which the offer is made and accepted must also correspond. This is referred to as the postal rule, a precedent which was established in English contract law by the case of Adams and Lindsell (1818) 106 ER 250 (KB). To determine This is a situation in which there are two simultaneous offers between both parties which have similar terms but they ‘cross’ at the post. It was held that due to this, the a… As provided in the case of Felthouse vs Bindley, an acceptance is invalid unless it is communicated to the offeror. The addition of an extra term terminates the initial offer and it thus becomes a new offer which the former offeror is at liberty to accept or reject. The acceptance must be communicated to the seller. The respondent won in the High Court and the Court of Appeal. Subsequently, there was an agreement between both parties. An option contract is the exception to the general rule that an offer can be revoked at anytime before acceptance. Disagreements occurred between the parties which ended up S refusing to supply the van. In the case of Felthouse vs Bindley, the plaintiff made an offer to his nephew and he stated that if he did not receive a reply he would assume that the offer has been accepted. Significance of criminal element in this case – the avoidance of harsh penalties. This was the first case to establish the postal rule. acceptance. PL sellers in London made offer by telex to sellers (agents) in Holland. In the English case of Manchester Diocesan council vs Commercial and general investments Ltd, it was decided that where the method of acceptance is prescribed, unless that particular method is mandatory, any other method of acceptance that is faster would be valid. Exceptions To The Rule of Acceptance By Post. To count as an acceptance, the other party’s reaction to the offer must amount to a clear, unequivocal, unqualified statement that the former accepts on exactly the terms of the offeror’s offer (the so-called “mirror image” principle). The common law provisions are in conflict with Nigerian judicial and legal provisions. Statements were merely Invitations to Treat not offers capable of being accepted. The acceptance must be communicated to the seller. Whereas an offer will lead to a binding contract on acceptance, an invitation to treat can not be accepted it is merely an invitation for offers. TIME STATED IN THE OFFER When making the offer, the offeror may state how and when the offer must be accepted. Postal rule was excluded as the means of communication which was ‘notice in writing’ was not meet. However, the performer of the act is ignorant of the offer. There have to have an offer offered by one party which is accepted by the other. Even if there was an intention to accept, the absence of communication makes it invalid. There was no objective standard found by the court to know “what price was intended / or what a reasonable price might be”. It was held that due to this, the acceptance was successfully revoked. Blackpool and Fylde Aero Club v Blackpool BC [1990] EWCA Civ 13. The agreement letter was signed and returned by C. Valid contract because the council letter demonstrated an intention to be bound by the terms of the agreement. HELD: no binding contract was created. the plaintiff made an offer to his nephew and he stated that if he did not receive a reply he would assume that the offer has been accepted. Council send booklet to claimant announcing a scheme for tenants to buy their council houses. In the case of Winn vs Bull it was decided that this meant that the acceptance is not complete until the drawing up of a formal contract. However, when the acceptor puts in a new condition while accepting the contract already signed by the proposer, the contract is not complete until the proposer accepts that condition," the top court held. The revocation of an offer could only be effective when communicated to the other party, while the acceptance of an offer by telegram is effective as soon as it was sent. Uncle and nephew resale of n ’ s horse concluded that it ‘ accepted the! Only the person to whom the offer must be accepted prepared to sell him the horse however, sort... 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