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Contract Law - Unilateral Contracts Summary
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Comprehensive summary/exam notes on unilateral contracts in Contract Law. This document covers the case of Carlill v Carbolic Smoke Ball, the rules regarding offer, acceptance and consideration in unilateral contracts, and the extent of recovery in relation to such contracts (specifically an action...

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  • October 6, 2024
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  • 2022/2023
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Unilateral Contracts
1. Offer or Invitation to Treat?
General rule = a newspaper advertisement is an invitation to treat rather than an
offer.
Partridge v Crittenden – D advertised Bramblefinch cocks and hens for sale.
Lord Parker CJ – there was “business sense” in treating them as
invitations to treat – if treated as an offer, the advertiser might find
himself contractually obliged to sell more goods than he in fact
owned.
Exception = unilateral contract:
Carlill v Carbolic Smoke Ball –
D sold the ‘carbolic smoke ball’ and advertised it in the newspaper,
stating that £100 will be paid to any person that contracts influenza,
colds, or associated diseases after using the ball 3 times daily for 2
weeks and that £1000 is deposited in the Bank showing their
sincerity.
C did as directed but caught influenza and sued for £100.
Held that this was a binding unilateral contract – the advertisement
amounted to an offer made to the public and is accepted by anyone
who performs the condition specified therein.
The bank deposit showed the sincerity of the company and
was therefore not a mere puff.
Intention to create legal relations point.
CA had in mind the policy consideration of consumer protection
against spurious advertisements.
2. Acceptance:
General rule = acceptance is fully performing the requested act.
There is no need to give advance notification of acceptance.
Carlill v Carbolic Smoke Ball
Important qualification = there must be an implied obligation on the part of the
offeror not to prevent the condition becoming satisfied.
This obligation arises as soon as the offeree starts to perform.
Dualia Ltd v Four Millbank Nominees Ltd –
Oral agreement between C and D that D would exchange contracts if
C attended D’s offices with a draft contract in terms agreed and a
banker’s draft for the amount of the deposit. C duly went to D’s
office with the draft contract and banker’s draft, but D refused to
sign.
3. Withdrawal:
General rule = an offer can be withdrawn by the offeror at any time before it has
been accepted.
BUT – difficulty = determining the exact stage at which the offer is
“accepted” so as to deprive the offeror of the power of withdrawal.
According to one view, there is no contract until the required act or forbearance has
been completed.
BUT – this would cause excessive hardship to the offeree.
Part-performance likely to be enough.
BUT – factual difficulties might arise in distinguishing between
commencement of performance and mere preparation to perform.
e.g., unilateral contract for reward for the return of lost property.
This could likely still be withdrawn after someone had spent time
looking for the property without success, but not after he had actually
found it and was in the process of returning it.

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