Offers

Carlill v Carbolic Smoke Ball Co [1893] 1 QB 256

Facts

• Company advertised that it would pay £100 to anyone who used its smoke ball and nevertheless contracted influenza.
• Advertisement stated that £1000 had been deposited in a bank.

Judgment

• Advertisement constituted a valid offer.

Legal Principle

• An offer may be made to the world at large.
• A unilateral offer becomes binding upon performance.

Application

• Leading authority on unilateral offers.
• Exception to the general rule that advertisements are invitations to treat.

Storer v Manchester City Council [1974] 1 WLR 1403

Facts

• Council sent a completed agreement for sale.
• Storer signed and returned the document.

Judgment

• Contract existed.

Legal Principle

• Clear, certain and definite words may constitute an offer.

Application

• Demonstrates when negotiations become an offer.

Gibson v Manchester City Council [1979] 1 WLR 294

Facts

• Council stated it “may be prepared to sell” the property.

Judgment

• No contract.

Legal Principle

• Statement lacked certainty.
• Therefore it was not an offer.

Application

• Contrasts directly with Storer.

Harvey v Facey [1893] AC 552

Facts

• Harvey asked Facey:
  • “Will you sell us Bumper Hall Pen?”
  • “Telegraph lowest cash price.”
• Facey replied:
  • “Lowest price £900.”
• Harvey purported to accept.

Judgment

• No contract.

Legal Principle

• Mere statement of price is not necessarily an offer.

Application

• Important distinction between information and offers.

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Invitation To Treat

Partridge v Crittenden [1968] 1 WLR 1204

Facts

• Advertisement offered wild birds for sale.
• Defendant prosecuted for offering protected birds.

Judgment

• Conviction quashed.

Legal Principle

• Advertisements are generally invitations to treat rather than offers.

Application

• Leading authority on advertisements.

Fisher v Bell [1961] 1 QB 394

Facts

• Shopkeeper displayed a flick knife in a shop window with a price tag.

Judgment

• No offer had been made.

Legal Principle

• Display of goods is an invitation to treat.

Application

• Leading authority for shop displays.

Pharmaceutical Society of Great Britain v Boots Cash Chemists [1953] 1 QB 401

Facts

• Medicines displayed on self-service shelves.
• Customer selected goods before reaching cashier.

Judgment

• Display was invitation to treat.

Legal Principle

• Customer makes offer at checkout.
• Shop accepts at the till.

Application

• Leading authority for self-service stores.

Grainger & Son v Gough [1896] AC 325

Facts

• Wine merchant circulated catalogue.

Judgment

• Catalogue was invitation to treat.

Legal Principle

• Price lists and catalogues are generally invitations to treat.

Application

• Important authority for commercial advertisements.

Auctions

Payne v Cave (1789) 3 TR 148

Facts

• Bidder withdrew bid before auctioneer accepted.

Judgment

• Withdrawal valid.

Legal Principle

• Bid constitutes offer.
• Acceptance occurs when hammer falls.

Application

• Fundamental auction authority.

Sale of Goods Act 1979 s57(2)

Provision

• Sale by auction is complete when auctioneer announces completion by the fall of the hammer or other customary manner.

Application

• Statutory confirmation of Payne v Cave.

Barry v Davies [2000] 1 WLR 1962

Facts

• Auction advertised without reserve.
• Highest bidder offered £200.
• Auctioneer refused to sell.

Judgment

• Highest bidder succeeded.

Legal Principle

• Auction without reserve creates a collateral contract.
• Auctioneer must sell to highest genuine bidder.

Application

• Leading authority on auctions without reserve.

Warlow v Harrison (1859) 1 E&E 309

Facts

• Auction advertised without reserve.
• Auctioneer withdrew goods.

Judgment

• Dicta recognised bidder’s rights.

Legal Principle

• Auction without reserve may create obligations to highest bidder.

Application

• Foundation for Barry v Davies.

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Counter Offers

Hyde v Wrench (1840) 3 Beav 334

Facts

• Defendant offered to sell land for £1000.
• Claimant replied offering £950.
• Defendant refused.
• Claimant then attempted to accept original offer.

Judgment

• No contract.

Legal Principle

• Counter offer destroys original offer.

Application

• Leading authority on counter offers.

Jones v Daniel [1894] 2 Ch 332

Facts

• Offeree attempted to vary terms of offer.

Judgment

• Counter offer made.

Legal Principle

• Alteration of terms constitutes rejection of original offer.

Application

• Supports Hyde v Wrench.

Requests For Information

Stevenson Jacques & Co v McLean (1880) 5 QBD 346

Facts

• Offer made to sell iron.
• Offeree asked whether payment terms could be extended.

Judgment

• Original offer remained open.

Legal Principle

• Request for information does not amount to a counter offer.

Application

• Distinguishes requests for clarification from rejection.

Harvey v Facey [1893]

Application

• Often used to illustrate that requests for information do not necessarily create contractual obligations.

Termination Of Offers

Revocation

Dickinson v Dodds (1876) 2 Ch D 463

Facts

• Offer left open until Friday.
• Offeree learned through a third party that property had been sold elsewhere.

Judgment

• Offer revoked.

Legal Principle

• Revocation may be communicated through a reliable third party.

Application

• Leading authority on indirect revocation.

Byrne v Van Tienhoven (1880) 5 CPD 344

Facts

• Offer posted.
• Revocation posted later.
• Acceptance posted before revocation arrived.

Judgment

• Contract existed.

Legal Principle

• Revocation only effective upon communication.

Application

• Important postal rule authority.

Routledge v Grant (1828) 130 ER 920

Facts

• Offer promised to remain open.
• Offeror withdrew before acceptance.

Judgment

• Withdrawal effective.

Legal Principle

• Offer may generally be revoked before acceptance.

Application

• Leading revocation case.

Death

Bradbury v Morgan (1862) 1 H&C 249

Facts

• Offeror died before acceptance.

Judgment

• Contract remained enforceable.

Legal Principle

• Death does not automatically terminate all offers.

Application

• Depends upon nature of contract and knowledge of death.

Lapse Of Time

Ramsgate Victoria Hotel Co v Montefiore (1866) LR 1 Ex 109

Facts

• Offer to buy shares accepted five months later.

Judgment

• No contract.

Legal Principle

• Offer lapses after reasonable time.

Application

• Leading lapse authority.

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Acceptance

Entores Ltd v Miles Far East Corporation [1955] 2 QB 327

Facts

• Acceptance communicated by telex.

Judgment

• Contract formed where acceptance received.

Legal Principle

• Instantaneous communications effective upon receipt.

Application

• Important modern acceptance authority.

Brinkibon Ltd v Stahag Stahl [1983] 2 AC 34

Facts

• Acceptance sent by telex.

Judgment

• Contract formed upon receipt.

Legal Principle

• Reinforced Entores.

Application

• Governs electronic communications.

Felthouse v Bindley (1862) EWHC CP J35

Facts

• Uncle stated silence would amount to acceptance.
• Nephew did not reply.

Judgment

• No contract.

Legal Principle

• Silence cannot constitute acceptance.

Application

• Leading silence authority.

Brogden v Metropolitan Railway Co (1877) 2 App Cas 666

Facts

• Formal agreement incomplete.
• Parties performed contract.

Judgment

• Contract existed.

Legal Principle

• Acceptance may be inferred from conduct.

Application

• Leading conduct acceptance authority.

Adams v Lindsell (1818) 106 ER 250

Facts

• Acceptance sent by post.

Judgment

• Contract formed when acceptance posted.

Legal Principle

• Postal Rule established.

Application

• Foundation authority for postal acceptance.

Household Fire Insurance Co v Grant (1879) 4 Ex D 216

Facts

• Acceptance posted but never received.

Judgment

• Contract existed.

Legal Principle

• Postal acceptance effective when posted.

Application

• Confirms postal rule.

Contracts By Tender

Spencer v Harding (1870) LR 5 CP 561

Facts

• Invitation issued requesting tenders.

Judgment

• No obligation to accept highest tender.

Legal Principle

• Invitation for tenders is normally an invitation to treat.

Application

• Leading tender authority.

Blackpool & Fylde Aero Club Ltd v Blackpool Borough Council [1990] 1 WLR 1195

Facts

• Council invited tenders.
• Tender submitted correctly and on time.
• Council failed to consider it.

Judgment

• Council liable.

Legal Principle

• Invitation to tender may create a collateral contract requiring proper consideration of conforming tenders.

Application

• Leading authority on procedural obligations in tender processes.

Harvela Investments Ltd v Royal Trust Co of Canada [1986] AC 207

Facts

• Defendants invited sealed bids.
• One bidder submitted a referential bid.

Judgment

• Referential bid invalid.

Legal Principle

• Where the invitation contemplates a highest fixed bid, only fixed bids are valid.

Application

• Important authority on competitive tendering.

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Standard Form Contracts (Battle of Forms)

Butler Machine Tool Co Ltd v Ex-Cell-O Corporation [1979] 1 WLR 401

Facts

• Buyer and seller exchanged documents containing conflicting terms.

Judgment

• Contract formed on buyer’s terms.

Legal Principle

• Traditional offer and acceptance analysis determines which terms prevail.

Application

• Leading battle of forms authority.

British Road Services Ltd v Arthur V Crutchley Ltd [1968] 1 All ER 811

Facts

• Goods delivered under conflicting standard terms.

Judgment

• Last document exchanged governed contract.

Legal Principle

• Last Shot Doctrine.

Application

• Frequently applied in standard form disputes.

Tekdata Interconnections Ltd v Amphenol Ltd [2009] EWCA Civ 1209

Facts

• Parties exchanged conflicting standard terms.

Judgment

• Traditional offer and acceptance principles applied.

Legal Principle

• English law generally resolves standard form disputes through orthodox contract analysis.

Application

• Modern battle of forms authority.

Essential Statutory Provisions

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