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Formation of the Contract - Acceptance
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Formation of the Contract - Acceptance
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Formation of the Contract – AcceptanceAcceptance
‘A final and unqualified expression of assent to the terms of an offer’. Professor Treitel.
A mere acknowledgement of an offer is not considered to be acceptance.
Expression of some intention to make an order, or an intention to accept is not
considered to be acceptance.
An enquiry for further information on the product/service/offer is not considered to
be acceptance.
May be expressed or implied, through words or by conduct.
The offeree must be aware of the offer before it can be accepted.
The terms of the acceptance must correspond to the terms of the offer, and they
must be final and unequivocal.
Acceptance must be communicated to the offeror.
Acceptance by Words
A purported acceptance which attempts to introduce new terms, or vary the terms
of the original offer, or impose new conditions, or only agrees to part of the offer,
cannot be acceptance. There is no meeting of minds.
A counter-offer will bring the original offer to an end, which therefore makes it
incapable of being accepted.
For example, the original offer for a car is £100, someone else offers to pay £800.
This ‘cancels’ the original offer, and therefore the seller of the car has to choose
whether or not they wish to accept the counter-offer or not. The buyer cannot then
go back and say they accept the original offer, as this is no longer valid.
Hyde v Wrench (1840) 3 Beav 334.
The defendant offered to sell his farm to the claimant for £1000, the claimant
responded that they will buy the farm for £950 (counter-offer). Hyde then changed
his mind and tried to accept the original offer, Wrench at this point refused to sell
the farm for £1000.
The claimant sued the defendant saying that ‘they had an agreement’.
£950 was the counter-offer which killed off the original offer of £1000, so Wrench
was right in rejecting this and refusing to sell the farm to Hyde.
Requests for further information do not count as acceptance.
The offeree is still able to accept the offer after having received the further
information, if they agree to all the terms and details of the product or service they
wish to purchase.
Stevenson Jacques & Co v McClean (1880) 5 QBD 346.
Battle of the Forms
, One party makes an offer in the form of a pre-printed form contract, and the offeree
responds with its own form of contract.
The party that got their terms in last, without any objections, could prevail.
BRS v Crutchley (1968) 1 AII ER 811.
The plaintiff transported a lorry load of whisky by road and delivered it to a
warehouse owned by the defendant. Upon arrival, the whisky was unloaded and
placed on a trailer for the next leg of the journey which was to take place the
following day. Overnight, the warehouse was guarded by security but the whisky was
in view of the public. The security officer made one less than his scheduled visits to
the warehouse that night and shortly after his last visit, thieves stole the whisky from
the warehouse. The plaintiff paid the whisky owners compensation and
subsequently sued the defendant for negligence.
It was held that the protection provided by the defendant was inadequate and
therefore the defendant’s negligence was deemed to have caused the loss. As a
result of this, the defendants were liable to the plaintiffs for damages. The court
found that due to the conditions of the agreement, the defendant was only liable for
£800 per ton in damages.
Butler Machine Tool Co v Ex Cell O Corp (1979) 1 AII ER 965.
The defendant wanted to buy machine tools, Butler Machine Tool offered to sell
them tools for £75,000.
Butler: ‘subject to conditions that prevail over any terms in the buyer’s order…’. One
of the terms will prevail any terms that the buyer gives, a price variation clause.
4 days later the defendant ordered some tools, that stated they ordered on their
own terms (without the price being altered).
Ex Cell O: ‘we accept your order on the terms and conditions stated thereon…’. This
was written at the bottom of the form, which had to be signed by Butler Machine
Tool.
Butler: order entered into on their terms.
The original offer is no longer valid as Ex Cell O introduced a counter-offer which may
prevail.
Court of Appeal held that the contract didn’t include the price variation clause
(Butler tried to increase the price by £3000), as there was a counter offer which
didn’t state that this clause would be included, and the terms of Ex Cell O were to be
followed.
Photolibrary v Burda (2008).
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