Binding Contract

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  • Topic: Contract, Offer and acceptance, Invitation to treat
  • Pages : 2 (648 words )
  • Download(s) : 370
  • Published : April 9, 2013
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Law assignment

Name: Chang Jun Han
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The issue in this case deals with invatition to treat , offer , counter-offer , conditional acceptance and acceptance . It also deals with the elements of valid contract. General rule for a binding contract is an offer and an acceptance of the proposal. There must be effective communication to the proposer. It is very important to differeciate a proposal from an invitation to treat. Invitation to treat is a stage of negotiation and inviting others to make an offer. A common example is the display of goods for sale in a shop. Besides that, acceptance and counter offer are different. In the famous case of Pharmaceutical Society of Great Britain v Boots Case Chemists , the display of drugs on shelves of pharmacy did not amount to offer but only a case of invitation to treat , the offer only occur when the customer took the goods and pay at the counter , depending on the cashier to accept the offer. By Section 2(a) of the Contract Act 1950 , ‘When one person signifies to another his willingness to do or to abstain from doing anything, with a view to obtaining the assent of that other to the act or abstinence , he is said to make a proposal ‘. There will be binding contract when a proposal is unconditionally accepted. In the case of Tan Geok Khoon & Gerard Francis Robless v Paya Terubong Estate shows that an offer is definition and statement of willingness to be bound. Counter offer amount to rejection which will revoke the original offer. If acceptor accept with some modication or condition to the offer , it would amount to counter-offer . In the case of Hyde v Wrench , defendant offered to sell his property to the plaintiff at the price of $1000 and the plaintiff replied stating to buy at $950. When the price is not acceptable to defendant then plaintiff wrote to defendant accepting the original offer. The court held that plaintiff’s...
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