Case Examples

Topics: Contract, Contractual term, Sale of Goods Act 1979 Pages: 24 (5633 words) Published: November 29, 2010
Offer and Acceptance

Invitation to Treat

• Goods Displayed on Shelves
o Pharmaceutical Society of GB –v- Boots Cash Chemists [1953] o Pharmacy and Poisons Act 1933 – chemist to be present at point of sale. Point of sale was cash desk, displaying of product was invitation only. ▪ Freedom of contract preserved – shops can refuse sale • Goods Displayed in Shop Window

o Fisher –v- Bell [1961]
▪ Offensive Weapons Act 1959 – sale of prohibited weapons. Failed as display was not sale, rather invitation to treat. • Advertisements
o Partridge –v- Crittenden [1968]
▪ Protection of Birds Act 1954 – “Bramblefinch cocks and hens 25s each” not an offer. • Lack of objectivity
o Gibson –v- Manchester City Council [1979]
▪ G invited to buy house. M invited application on “may be prepared to sell” basis. Not an offer. • Mere statement of price
o Harvey –v- Facey [1893]
▪ Sale of Penn. H: “telegram lowest price”. F: “lowest acceptable £900”. Not an offer, merely statement. • Lots at Auction
o Harris –v- Nickerson [1873]
▪ Furniture listed in catalogue, H hoped to buy. Items withdrawn. Advertising was invitation to treat, acceptance only at fall of hammer. o British Car Auctions –v- Wright [1972]

▪ Prosecution for selling unroadworthy car. No offer to sell at auction. Failed.

Not Invitation to Treat

• Unilateral Offer
o Carlill –c- Carbolic Smoke Ball Company [1893]
▪ Promise to pay £100 for unsuccessful usage in advert was an offer that could be accepted by anyone. • Statement of Price where offer is intended
o Biggs –v- Boyd Gibbins [1971]
▪ B: “for a quick sale I will accept £26,000”. BG accepts and B affirms. There is an offer. • Competitive tendering
o Spencer –v- Harding [1870]
▪ Invitation to submit tenders is not an offer to sell to highest bidder. o BUT: Harvela Investments –v- Royal Trust of Canada [1986] ▪ Advert stipulated sale to highest bidder. Lowest bidder stated $2,100,000 or £101,000 in excess of any other. H sued successfully. Wording ensured offer could only be accepted by H. o Blackpool and Fylde Aero Club –v- Blackpool BC [1990] ▪ Council put up airport pleasure flight usage for competitive tender. Stated not bound by any bid. Tender time closed early. RR Helicopters won. Council discovered mistake and re-run but legal threat from RRH. Court acknowledged implied undertaking to operate by the set rules. • Auctions without reserve

o Warlow -v- Harrison [1859]
▪ Collateral contract created between the highest bona fide bidder and the auctioneer himself when the auctioneer refuses sale. o Barry –v- Davies [2000]
▪ Auction without reserve withdrawn, thus auctioneer refused sale to claimant (2 x £200). Then sold privately for £750 each. Existence of collateral contract - £27,600 damages.


• Must be communicated to the offeree
o Taylor –v- Laird [1856]
▪ T gave up captaincy and worked as member of crew, wages claim failed, owner had no knowledge. o Inland Revenue Commissioners –v- Fry [2001]
▪ F owed £113,000; F sends £10,000 cheque “in full and final settlement to be accepted when banked”. IRC procedure to bank before correspondence. Court held unilateral offer could be accepted but IRC had no knowledge, hence ignorant and thus no acceptance. • Can be made to the whole world

o Carlill –v- Carbolic Smoke Ball Co [1893]
• Must be certain
o Guthing –v- Lynn [1831]
▪ £5 more “if horse is lucky” is too vague. • Can be withdrawn at any time before acceptance
o Routledge –v- Grant [1828]...
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