Definition: 1.

Agreement: An agreement will only be seen generally if there is a clear, unequivocal offer mirrored with a clear, unequivocal acceptance. 2. Offer: An indication of willingness to do or retrain from doing something that is capable of being converted by acceptance into a legally binding contract. 3. Invitation to treat (ITT): invitation to others to make an offers. 4. Acceptance: Agreement to the terms of an offer that, provided certain other requirement are fulfilled, converts the offer into legally binding contract. 5. Counter offer: A response to an offer, made to the offeror by the offeree, that seeks either to introduce a new term or to vary an existing term of the offer. Acceptance: General Rule: Acceptance must be communicated to the offeror. Case: Entores v Miles Far East Corp [1955] 2 QB 327 The plaintiff, a company based in London, made an offer by telex (similar to a fax machine) to the defendants, a company based in Amsterdam who acted as agents for an American corporation. The defendants sent their acceptance of the offer by telex. The plaintiffs applied for leave to serve notice of a writ on the American corporation in New York. Their entitlement to do so turned on the answer to the question: where was the contract made? Was the contract made when the defendants sent their acceptance by telex (in Amsterdam) or was it made when the telex was received on the plaintiffs' machine (in London)? It was only if the contract was made in England that the court had jurisdiction to grant leave to serve out of the jurisdiction. Held: The contract was formed when the communication of the acceptance was received by the plaintiffs in London so that the English courts had jurisdiction and that this was a proper case for service out of the jurisdiction. Denning LJ said:"Suppose, for instance, that I shout an offer to a man across a river or a courtyard but I do not hear his reply because it was drowned by an aircraft flying overhead. There is no contract at that moment. If he wishes to make a contract, he must wait till the aircraft is gone and then shout back his acceptance so that I can hear what he says. Not until I have this answer I bound." Ignorance of an offer:

General rule: Performance of the requested act does not amount to an acceptance unless the party performing the act did so with knowledge of the existence of an offer. Exception: If the existence of the offer plays some part, however small, in inducing a person to do the required act, there is valid acceptance of the offer.

The Reward Able To Claim Knew The Reward Where After Done The Performance Case Gibbons v Proctor (1891) 64 LT 594

Knew The Existence Of The Reward Williams v Carwadine (1883) 4 B & Ad 621 Background On 29 May, defendant instructed his printers to A by public advertisement print handbills, offering a reward of 25 to the stated, that whoever would person who should give information to a give information which superintendent of police, named P, leading to should lead to the discovery the conviction of the perpetrator of a certain of the murder of B should, on crime. Plaintiff, a police officer, on the same conviction, receive a reward morning before the instructions to print the of 20: Held C, who gave handbills had been given by defendant, had such information, was communicated the desired information to a entitled to recover the 20, fellow police officer named C, with though she was led to inform instructions to forward it to Superintendent P, not by the proffered reward, and C thereupon communicated the but by other motives. information, in accordance with the rules of the forces, to his own immediate superior officer, Inspector L, who sent it on the same evening to Superintendent P, whom it reached in due course on the following morning, 30 May, after time when the handbills had been delivered to and had been distributed by him to the neighbouring police-stations: Held plaintiff, the importance of whose information C. was entitled to the reward, was admitted, was entitled to the reward, the although it was found by the messengers, C and L, through whom such jury that C. did not give the information was conveyed to Superintendent information in consequence P, being plaintiff's agents to convey, and not of the offered reward, but P's agents to receive the said message. from other motives. Held, also, that the first person who gives the information is entitled to the reward, and the motive of such person in giving the information is not material. If two persons go together to give the information, they must bring a joint action for the reward.)

The Reward Unable To Claim Knew The Existence Of The Reward But Has Forgotten Case R v Clarke (1927) 40 CLR 227- Australia Case Background A reward was publicly offered by the

Did Not Know The Existence Of The Reward Fitch v Snedaker 38 NY 248 (1868)-American case Not applicable

Held

Government of Western Australia for such information as shall lead to the arrest and conviction of the person or persons who committed the murders of two police officers. C who knew of the offer, gave information that led to the arrest of one person, and the conviction of that person and another for the murder of one of those officers. By petition of right under Crown Suits Act 1898, C claimed payment of the reward Unless petitioner had performed the condition of the offer acting on the faith of or in reliance upon the offer, there was no acceptance of the offer, and, therefore, no contract between the parties.

A person who gave information without any knowledge of the reward cannot claim the reward.

Silence cannot amount to an acceptance

General rule: Silence in bilateral contract will not constitute acceptance.

General Rule Silence cannot amount to an acceptance Case Felthouse v Bindley (1862) 11 CB (NS) 869 Background The plaintiff (F) brought an action against the defendant auctioneer (B) for the conversion of a horse. In December 1860, a conversation had taken place between F and his nephew (N) relating to the purchase of a horse by F from N. On January 1, 1861, N wrote to F stating that he had heard from his father that F considered that he had bought the horse for 30. N asserted that the price was not 30 but 30 guineas. On January 2, F wrote to N stating that he thought that, although the price offered was 30 guineas, they had done a deal at 30. F's letter concluded as follows: "However, as there may be a mistake about him, I will split the difference ... If I hear no more about him, I consider the horse

Exception Silence can amount to an acceptance Re Selectmove Ltd [1995] 1 W.L.R. 474 The Inland Revenue petitioned for the winding-up of the company, S, on the basis of arrears of tax under the PAYE system. The winding-up order was made and S appealed on the ground that, in October 1991 at a meeting with the Revenue, it was agreed that due to S's cash flow problems the tax due would be paid in arrears. S therefore contended that the petition debt was disputed and the order should be set aside. The issues were whether the tax collector was entitled to accept the instalment proposal, whether there was consideration for the agreement and whether, if there was no agreement, estoppel prevented the Revenue from claiming the debt.

Judge Judgements

mine at [30 and 15 shillings]". N did not reply to that letter. The horse was sold by mistake at an auction conducted by B on February 25. On February 27, N wrote to F apologising for the mistake, referring to the horse "I sold to you" and offering to let him have another horse. The issue was whether the horse had become the property of F at the time of the sale on February 25. Willes J Balcombe, L.J.; Stuart-Smith, L.J.; Peter Gibson, L.J. There had been no complete bargain Dismissing S's appeal, that (1) the on January 2, and the offer made by F collector of taxes who met with S did in his letter of that date stood as an not have actual authority to make such open offer. Although the events had an agreement or otherwise bind the shown that N in his own mind Revenue. Further, there was no intended F to have the horse at the representation by the Revenue that the price which F had named, namely tax collector had the Revenue's 30 and 15 shillings, he had not authority to accept the offered communicated his intention to F or instalment proposal ( Armagas Ltd v done anything to bind himself. Mundogas SA (The Ocean Frost) Nothing, therefore, had been done to [1986] A.C. 717 applied); (2) an vest the property in the horse in F agreement to pay the arrears of tax in before February 25, when the horse instalments would not have been was sold by B. There had been no enforceable because there was no bargain to pass the property in the consideration on the part of the horse to F and he therefore had no Revenue ( Foakes v Beer (1884) 9 right to complain of the sale. App. Cas. 605 applied); (3) as the tax collector had no authority to make the agreement, neither could he make the promise on which the estoppel argument was based; and (4) as S had failed to pay the instalments it was entirely fair of the Revenue to seek to enforce the debt.

Battle of forms Case: Butler machine Tool Co. Ltd v Ex-Cell-O Corporation (England) Ltd [1979] 1 WLR 401 CA

Where parties to a contract have made offer and counter-offer, the documents passing between the parties must be construed as a whole, but the rules set out in Hyde v Wrench 49 E.R. 132 still apply. The plaintiff sellers offered to deliver a machine tool on condition that orders were only to be accepted on the terms set out in the quotation. The sellers' terms included a price variation clause. The defendant buyers replied with an order containing different terms and no price variation clause. The order had a tear-off slip of acknowledgment

on those terms, which acknowledgment was duly signed by the sellers. Due to the buyers' delay in accepting delivery the sellers invoked the price variation clause. The sellers were successful at first instance but on appeal, held, allowing the appeal, that the buyers' reply was a counter offer which the sellers had accepted by their acknowledgment

Held: Allowing the appeal, that the buyers' order of May 27, 1969, was not an acceptance of the offer in the sellers' quotation of May 23, but a counter-offer which the sellers had accepted by their letter of June 5, 1969, when the contract was completed without any price limitation clause.

Lord Denning said, I have much sympathy with the judge's approach to this case. In many of these cases our traditional analysis of offer, counter-offer, rejection, acceptance and so forth is out of date. This was observed by Lord Wilberforce in New Zealand Shipping Co. Ltd. v. A. M. Satterthwaite & Co. Ltd. [1975] A.C. 154, 167. The better way is to look at all the documents passing between the parties and glean from them, or from the conduct of the parties, whether they have reached agreement on all material points even though there may be differences between the forms and conditions printed on the back of them. As Lord Cairns said in Brogden v. Metropolitan Railway Co. (1877) 2 App.Cas. 666, 672: there may be a consensus between the parties far short of a complete mode of expressing it, and that consensus may be discovered from letters or from other documents of an imperfect and incomplete description; The offeror prescribes the method of acceptance Case: Manchester Diocesan Council of Education v Commercial & General Investments, Ltd [1969] 3 ALL ER 1593

In 1964, the plaintiff, in whom a school was vested under two schemes, made in 1962 and 1964 respectively, offered the school premises for sale by tender in anticipation of the closure of the school, which eventually took place in 1967. The conditions of sale, incorporating a form of tender, were drawn up by the plaintiff, and required tenders to be sent to the plaintiff's surveyor on or before August 27, 1964, and stipulated that the sale of the premises, subject to the 1962 scheme, was subject to the approval of the purchase price by the Secretary of State for Education and Science. Condition 4 provided that the person whose offer was accepted should be notified by letter sent to him by post at the address given in his tender and that every letter should be deemed to have been received in due course of post. A deposit of ten per cent. was payable within seven days after the posting of the notice of acceptance. Completion was not to take place until one month after the closure of the school. On August 26, 1964, the defendant posted a tender offering 28,500, and agreeing, in the event of the offer being accepted in accordance with the conditions on or before the day named therein, to pay the purchase price and complete the purchase in accordance with the conditions. The conditions did not name any day as the day on or before which any offer should be accepted. On September 15, 1964, the plaintiff's surveyor wrote to the defendant's surveyor stating that the plaintiff had accepted the defendant's offer. The Minister's approval was obtained on November 18, 1964, and on December 23 the plaintiff's solicitors wrote to

the defendant's solicitors to inform them and to ask them to confirm that there was a binding contract. The defendant's solicitors replied on January 5, 1965, that they were unable to confirm that there was a binding contract and therefore, on January 7, the plaintiff's solicitors sent a formal letter of acceptance to the defendant at the address given in the tender. On the same day the defendant wrote purporting to withdraw the offer.

Held: (1) that in the context of the earlier letters the letter dated September 15, was an acceptance of the defendant's offer notwithstanding that it was not in accordance with the mode of acceptance specified; (2) that the Secretary of State's approval as to the purchase price was required for the power of completion not for the conclusion of a contract; (3) that a contract was therefore concluded on September 15; or (alternatively to (3))(4) that the offer had neither lapsed nor been refused before January 7, 1965, when it was formally accepted and a contract formed.

BUCKLEY J. Condition 4, however, does not say that that shall be the sole permitted method of communicating an acceptance. It may be that an offeror, who by the terms of his offer insists upon acceptance in a particular manner, is entitled to insist that he is not bound unless acceptance is effected or communicated in that precise way, although it seems probable that, even so, if the other party communicates his acceptance in some other way, the offeror may by conduct or otherwise waive his right to insist upon the prescribed method of acceptance. Where, however, the offeror has prescribed a particular method of acceptance, but not in terms insisting that only acceptance in that mode shall be binding, I am of opinion that acceptance communicated to the offeror by any other mode which is no less advantageous to him will conclude the contract. Thus in Tinn v. Hoffman & Co. (1873) 29 L.T. 271, where acceptance was requested by return of post, Honeyman J. said, at p. 274: That does not mean exclusively a reply by letter by return of post, but you may reply by telegram or by verbal message or by any means not later than a letter written by return of post. Cross Offer Case: Tinn v Hoffman & Co (1873) 29 LT 271

Two persons, each in ignorance at the time of what the other had done, wrote a letter to each other on the same day, the one offering to buy a certain article at a certain price, and the other offering to sell the same article at the same price. The letters crossed each other in the post

Held:

Cross offers would not make a binding contract, and the offer in one of such letters could not amount to an acceptance of the offer contained in the other.

Reply by return of post, does not mean exclusively, reply by letter by return of post. A reply by telegram or by verbal message, or by any means, not later than a letter sent by post would reach its destination, would equally satisfy the requisition (per curium).

Exception rule to communication: Conduct of the Offeror Case: Entores v Miles Far East Corporation [1955] 2 QB 327

The plaintiff company in London made an offer by Telex to the agents in Holland of the defendant corporation, whose headquarters were in New York, for the purchase of a quantity of copper cathodes, and their offer was duly accepted by a communication received on the plaintiffs' Telex machine in London.

Held: Denning LJ, Although where a contract is made by post acceptance is complete as soon as the letter of acceptance is put into the post box, where a contract is made by instantaneous communication, e.g., by telephone, the contract is complete only when the acceptance is received by the offeror, since generally an acceptance must be notified to the offeror to make a binding contract; and that, since communications by Telex were virtually instantaneous, the contract in this case was made in London.