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Offer & acceptance question watch

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    Hello

    I'm doing an online law degree and this is the first seminar question I have been asked to prepare. I would have clearly asked fellow students on my course if I were actually attending university.

    Any guidance or assistance would be much appreciated.

    I have changed a few things such as names in the question before posting.

    Question

    Tom is a member of a travel club which offers holidays at reduced prices. He receives from the club details of a return coach trip from London to Nice via Paris for £50. The club states that they must be notified of bookings on one of their standard travel club booking forms by May 20th.Tom writes to the club on April 30th, stating that he wishes to book a seat but would want to join the coach at Paris and have the price reduced accordingly. He receives no reply from the club and so on May 19th he writes to the club stating that he wishes to book a seat on the coach trip as advertised by the club. This letter is not received by theclub until May 22nd.

    Advise Tom as to the legal position.
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    You should consider the basic tenets of contractual agreement, i.e. offer and acceptance. Start by analysing whether or not an offer was pronounced as opposed to an invitation to treat. (consider Gibson v Manchester City Council and Storer v Manchester City Council). Likewise, apply the case-law of an invitation to treat (Harvey v Facey would be a good starting point). State that an offer must be distinguished from an invitation to treat, by which a person does not make an offer but invites another party to do so. Back this up with academic authority - for example, Professor Treitel’s exposition of an offer is a quintessential authority in contractual theory (your textbook may have a definition of offer - be sure to correctly cite the passage with the in-text reference).State that, in order for an offer to be binding, the offeror (the person making the offer) must display a willingness to be bound as soon as it is accepted (Gibson v Manchester City Council). On the facts, it would seem that Tom's case is comparable to Storer v Manchester City Council, wherein it was held that the phrase 'if you sign and return the agreement, I will send you the agreement' compromised a valid offer.

    The terms would appear sufficiently clear to express an intention to be bound as soon as it is accepted (i.e. by returning the slip) and would thus amount to an offer. Next, you need to analyse whether or not Tom's letter can amount to an acceptance. His pronouncement that he would like to join the coach at Paris and have the price reduced accordingly may constitute a counter-offer as opposed to acceptance (Hyde v Wrench). Here, you should note what a counter-offer is. Generally, where a communication requests its own terms, it represents a counter-offer; likewise, trying to negotiate the price is not a conditional acceptance, rather it is a counter-offer. Tom's lack of willingness to contract on specified terms amounts to a counter-offer. If Tom's letter is a counter-offer, you should consider acceptance. An offer must be accepted and mutual assent must be present. (Entores v Miles Far East Corp). Postal acceptance would be applicable here - the general rule is that a postal acceptance takes effect when the letter of acceptance is posted (Henthorn v Fraser) even if the letter is lost or destroyed (Adams v Lindsell). However, where the travel company did not post acceptance, it is customary that silence cannot amount to acceptance (Felthouse v Bindley). Therefore, where there is no mutual assent as to the counter-offer supplied by Tom, no contract has been formed.

    Notwithstanding the lack of assent, Tom purports to send acceptance on May 19th to the original terms; however, this does not have binding effect - the counter-offer on April 30th kills the terms of the original offer as per Hyde v Wrench. Regardless of whether or not the postal rule may apply, no offer subsisted due to the counter-offer terminating the original offer.

    Contract law takes an objective approach to contract intention; that is, it seeks to analyse the parties' intentions by looking at their words or actions as opposed to their psychological intention. This was defined in Smith v Hughes. You should analyse whether or not the court, when applying the objective test, could come to the conclusion that a contract had been effected. Customarily, without the basic requisites of contractual formation (mutual assent) no contract can be made. Moreover, Tom's 'acceptance' on May 19th would not have effect wherein he made a counter-offer; it is objectively clear that, where a counter-offer is made, it terminates the original offer and, therefore, cannot be accepted. The basic rule is no acceptance, = no contract (silence cannot amount to a contract).
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    (Original post by lawobiter)
    You should consider the basic tenets of contractual agreement, i.e. offer and acceptance. Start by analysing whether or not an offer was pronounced as opposed to an invitation to treat. (consider Gibson v Manchester City Council and Storer v Manchester City Council). Likewise, apply the case-law of an invitation to treat (Harvey v Facey would be a good starting point). State that an offer must be distinguished from an invitation to treat, by which a person does not make an offer but invites another party to do so. Back this up with academic authority - for example, Professor Treitel’s exposition of an offer is a quintessential authority in contractual theory (your textbook may have a definition of offer - be sure to correctly cite the passage with the in-text reference).State that, in order for an offer to be binding, the offeror (the person making the offer) must display a willingness to be bound as soon as it is accepted (Gibson v Manchester City Council). On the facts, it would seem that Tom's case is comparable to Storer v Manchester City Council, wherein it was held that the phrase 'if you sign and return the agreement, I will send you the agreement' compromised a valid offer.

    The terms would appear sufficiently clear to express an intention to be bound as soon as it is accepted (i.e. by returning the slip) and would thus amount to an offer. Next, you need to analyse whether or not Tom's letter can amount to an acceptance. His pronouncement that he would like to join the coach at Paris and have the price reduced accordingly may constitute a counter-offer as opposed to acceptance (Hyde v Wrench). Here, you should note what a counter-offer is. Generally, where a communication requests its own terms, it represents a counter-offer; likewise, trying to negotiate the price is not a conditional acceptance, rather it is a counter-offer. Tom's lack of willingness to contract on specified terms amounts to a counter-offer. If Tom's letter is a counter-offer, you should consider acceptance. An offer must be accepted and mutual assent must be present. (Entores v Miles Far East Corp). Postal acceptance would be applicable here - the general rule is that a postal acceptance takes effect when the letter of acceptance is posted (Henthorn v Fraser) even if the letter is lost or destroyed (Adams v Lindsell). However, where the travel company did not post acceptance, it is customary that silence cannot amount to acceptance (Felthouse v Bindley). Therefore, where there is no mutual assent as to the counter-offer supplied by Tom, no contract has been formed.

    Notwithstanding the lack of assent, Tom purports to send acceptance on May 19th to the original terms; however, this does not have binding effect - the counter-offer on April 30th kills the terms of the original offer as per Hyde v Wrench. Regardless of whether or not the postal rule may apply, no offer subsisted due to the counter-offer terminating the original offer.

    Contract law takes an objective approach to contract intention; that is, it seeks to analyse the parties' intentions by looking at their words or actions as opposed to their psychological intention. This was defined in Smith v Hughes. You should analyse whether or not the court, when applying the objective test, could come to the conclusion that a contract had been effected. Customarily, without the basic requisites of contractual formation (mutual assent) no contract can be made. Moreover, Tom's 'acceptance' on May 19th would not have effect wherein he made a counter-offer; it is objectively clear that, where a counter-offer is made, it terminates the original offer and, therefore, cannot be accepted. The basic rule is no acceptance, = no contract (silence cannot amount to a contract).
    Thanks. I read this today but I had already started composing the essay.

    I was unsure if it was an offer or invitation to treat when I started my essay as Partridge v Crittenden Parker CJ stated, "that unless offer from a manufacturer makes no business sense in regarding advertisements as invitations to treat" as was the case in Carlill v Carbolic Smokeball co.As further stated in Partridge v Crittenden ' a manufacturer can make enough to meet demand' and it was merely details of a coach trip sent that was under consideration my Tom. So I considered Storer v Manchester City Council and concluded was an offer.

    I have completed the essay and used different cases but reached a similar conclusion to you.

    Thanks again
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    (Original post by g00nies)
    Thanks. I read this today but I had already started composing the essay.

    I was unsure if it was an offer or invitation to treat when I started my essay as Partridge v Crittenden Parker CJ stated, "that unless offer from a manufacturer makes no business sense in regarding advertisements as invitations to treat" as was the case in Carlill v Carbolic Smokeball co.As further stated in Partridge v Crittenden ' a manufacturer can make enough to meet demand' and it was merely details of a coach trip sent that was under consideration my Tom. So I considered Storer v Manchester City Council and concluded was an offer.

    I have completed the essay and used different cases but reached a similar conclusion to you.

    Thanks again
    My pleasure. Invitation to treat can, prima facie, be quite confusing; however, there are obvious distinctions between the bilateral and unilateral framework (i.e. Carill v Carbolic Smoke Co, where acceptance is reliant on performance of the requested acts) and whether or not a person intended to be bound by their offer as evinced in, for example, Harvela Investments Ltd v Royal Trust of Canada.
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    (Original post by lawobiter)
    My pleasure. Invitation to treat can, prima facie, be quite confusing; however, there are obvious distinctions between the bilateral and unilateral framework (i.e. Carill v Carbolic Smoke Co, where acceptance is reliant on performance of the requested acts) and whether or not a person intended to be bound by their offer as evinced in, for example, Harvela Investments Ltd v Royal Trust of Canada.
    lawobiter,

    I will keep that little tip on invitation to treat in mind for future reference,

    I am learning to construct the legal essays properly and put in enough cases.

    You seem to be rather clued up indeed in the area of contract law. If you are a student I can only assume you get top marks.

    Thanks again
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    (Original post by g00nies)
    lawobiter,

    I will keep that little tip on invitation to treat in mind for future reference,

    I am learning to construct the legal essays properly and put in enough cases.

    You seem to be rather clued up indeed in the area of contract law. If you are a student I can only assume you get top marks.

    Thanks again
    I did indeed study and obtain a law degree as part of the academic stage.

    Although contract law can be quite complex, when broken down into their constituent compartments, contract law can be readily comprehensible. Many people (not just students) often confuse the substantive components (i.e. being able to distinguish an offer from an invitation to treat, whether or not a counter-offer is just that, or constitutes a request for information, the concept of consideration and, may I say, the doctrine of promissory estoppel).

    As noted, Carlill v Carbolic Smoke Co. is the starting point for unilateral contracts. Notwithstanding their argument that the advertisement was an invitation to treat, their conduct - which included, inter alia, depositing money in the bank - showed a inherent disposition to be bound by their offer and thereby rendered it capable of being accepted by performance. This is different in the bilateral framework where, generally, the starting point is Harvey v Facey, Gibson v MCC and Storer v MCC and acceptance must be conveyed (there are many more cases applicable, however). The courts' approach is to explore the validity of a contract objectively, by asking whether or not a reasonable man could, when scrutinising the conduct and communications of the parties, determine an agreement had been reached. (As a side note, when applied objectively, the courts look at the parties' external manifestations upon what they have said, written or done, as opposed to their psychological manifestations).

    If you ever have anything to ask, you're more than welcome to send me a message through this forum.
 
 
 
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