Lecture notes study book Poole's Textbook on Contract Law of Robert Merkin QC, Severine Saintier (Chapter 2) - ISBN: 9780198816980, Edition: 14th Revised edition, Year of publication: - (Notes on Agreement)
part 2 , formation on agreement - Contract law (LAW1108)
Summary Poole's Textbook on Contract Law - LAW1108
contract law notes
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Aston University, Birmingham (Aston)
Aston University, Birmingham
Contract Law (BL1174)
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Agreement – Acceptance
Two requirements:-
- Acceptance in fact
- Acceptance must be communicated
Outcomes in acceptance in fact: -
1) Mirror Image Rule
- acceptance must be mirror of the offer
- Acceptance must correspond with the exact terms in the offer
- If offeree introduces a new term or amends term = counter offer
2) Counter-offer and Request for Further Information
- if offeree introduces a new term or amends a term
- Offer + counter offer = counter offer
- Counter can be accepted expressly or by conduct
- Offer + counter offer = destroys original offer
- Counter offer can extinguish original offer
- Does not destroy original offer so that it remains open for acceptance later
- Request for further information keeps original offer alive
Hyde v wrench (1840) – Counter Offer
- D offered to sell his farm to P for £1000
- P replied by offering to pay £950 for it
- D refused the P’s offer of the £950
- P thereupon offered the original prive of £1000
- D did not respond
- Held: No binding contract to purchase the farm
Stevenson v McLean (1880) – Request for Further Information
- D offered to sell iron to Ps at 40 net cash per ton – offer open until Monday
- Ps’ reply ‘ Please wire whether you would accept 40s for delivery over 2 months or if not
longest limit you could give’
- Not a counter-offer. It did not reject D’s offer but was simply inquiring whether D would
stagger delivery
- There was ‘no counter proposal’ from Ps in this response.
3) Battle of the forms
- each party trying to get the contract to be on their terms and conditions
- Inevitably there are differences
- Problem on occasion as a result ‘battle of the forms’ there may be no contract. No matching
offer and acceptance – despite what the parties themselves may think
Authority: Butler Machine Tool v Ex-Cell (1979) and Tekdata v Amphenol (2009)
- Sellers’ Quotation – term that price of machine market at date of delivery = Offer
, - Buyers’ order – no price variation = Counter-offer
- Sellers completed and returned acknowledgment slip at bottom of buyers’ order ‘we accept
your order on the Terms and Conditions stated thereon’ = Expressly accepted counter-offer,
fixed price, no price variation
- Majority of CA applied Hyde v Wrench
- Buyers’ order was a counter-offer
- Sellers had expressly accepted that counter-offer by signing and returning acknowledgement
slip
- There was therefore a contract on the buyers’ terms (fixed price contract – no price
variation)
- In a the ‘battle of forms’ acceptance may be by conduct
- Acceptance by conduct can often (although not always) take the form of delivery of goods
after the last shot is fired
Brogden v Metropolitan Rlwy, Tekdata v Amphenol, Trebor Bassett v ADT Fire & Security
Chronology
Offer Counter-offer Acceptance by Conduct
- Secret to success – get the last shot in before offer is accepted
4) Prescribed method of acceptance
- the method in which the respondent must accept the offer is made clear by offeror
- If the prescribed method was to benefit offeree, offeree can waive stipulation for his benefit
if it does not adversely affect offeror. (Yates v Pulleyn)
Manchester Diocesan (1970)
- Acceptance by letter to specified address
- P (offeree) wanted this so that on posting there would be binding acceptance
- But P sent acceptance to D’s surveyor instead
- Buckley J held was valid acceptance because:
a) No less advantageous to D (offeror) to receive notification of acceptance via his surveyor
b) P (offeree) could waive stipulation for his benefit so that acceptance was not effective unil
actually communicated to D’s surveyor
5) Acceptance in response to offer and with knowledge of it
- must be made in response to the offer and with knowledge of the offer
- claimant, for example, would not be entitled to a reward when performance of the
requested act had taken place in ignorance of the reward. R v Clarke (1927) – someone gave
information without knowing
- Williams v Carwardine (1833) – so long as an offeree had knowledge of the offer and accepts
in response to the offer – his motive for doing do will be irrelevant
- Gibbons v Proctor (1891) – information should be given to a particular person namely
Superintendent Pen to claim a reward. Information initially given to another colleague of
Superintendent Penn when there was no knowledge of the reward. But by the time the
information reached Superintendent Penn – the offeree had knowledge of the reward.
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