Offer and Acceptance

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  • Topic: Contract, Invitation to treat, Offer and acceptance
  • Pages : 4 (1530 words )
  • Download(s) : 322
  • Published : May 7, 2007
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Business Law: Offer and Acceptance.

For a simple contract to be valid one party must make an offer and the other party accept it. ‘An offer is made where a person (the offerer) unequivocally expresses to another (the offeree) his willingness to make a binding agreement on the terms specified by him if they are accepted by the offeree' (Card 2002). This offer could be made to a specific person, in which case it cannot be accepted by anyone other than that individual. On the other hand it could be made to a group of people or the whole world! Usually the offer will indicate a number of things like in which form the acceptance should take, it may also have a time limit for acceptance attached to it. In which case this will be a self-terminating contract. If the offer does not have a time limit the courts may deem the offer to have expired after a reasonable time even if the offerers haven't actually revoked the offer. An offer can be revoked at any point up to acceptance as long as the offerer has made this clear to the offeree.

Offer's can sometimes get confused with an ‘Invitation to treat'. It is important not to get the two confused as there are different rules regarding both. An example of an invitation to treat would be an item on display with a price label in a shop window. This is an invitation to open negotiations with a view to forming a contract; in other words it can be seen by anyone that happens to walk past the shop at the time of the window display. A good example of a case associated with this is Fisher v Bell (1961). The defendant, a shopkeeper, was prosecuted for displaying an illegal flick-knife for sale. Because it is an offense to offer such an item he was convicted. On appeal, however, it was held that a shop window display is an invitation to treat, not an offer in contractual terms. The conviction was therefore quashed (K-Zone law).

Tenders can sometimes be confused for offers when really they are invitations to treat....
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