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An offer and an invitation to treat

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by

Lea Wind

on 23 October 2013

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Transcript of An offer and an invitation to treat

An offer and an invitation to treat
Main parts of the offer.
The offer consists of
Test of intention
Respond on the
required information
Advertisement and ITT
Basic rule : Advertisement is just an invitation to treat, not an offer.
What is the essence of the contract?
It is an agreement.

Agreement = Offer+Acceptance

TREITEL, 2011 about the offer: "It is an expression of willingness to contract on specified terms, made with intention that it is to become binding as soon as it is accepted by the person to whom it is addressed".

a will to be bound
clear terms of the
agreement
Sufficiently specific
Comprehensive
Capable for immediate acceptance
Serious
Certain
Straightforward
Understand of obligations
Request, but not
an offer
Harvey v Facey [1893] AC 552 Privy Council
Interfoto Picture Library Ltd v Stiletto Visual Programmes Ltd [1989] QB 433
Why : Sellers should be protected from the possibility of demand an exceeding supply.
Obligatory in the offer
Exceptions from the basic rule:
Basic rule: if the contract is binned, it can not be reversed.
Storer v Manchester City Council [1974] 1 WLR 1403
Gibson v Manchester City Council [1979] UKHL 6
Greville v Venables [2007] EWCA Civ. 878
Carlill v Carbolic Smoke Ball Company [1892] 2 QB 484
Chapelton v Barry UDC [1940] 1 KB 532
Examples of ITT*.
Proper offer
Shop display
Tenders
Displays on the shop.
Auction sales.
Tenders.
General rule: a goods display on the shelves or in self-service stores are just an invitation to buy, not a proper offer.
Pharmaceutical Society of Great Britain v Boots Cash Chemists (Southern) Ltd [1953] EWCA Civ 6
Always remember that the seller can suffer the criminal liability under Protection of Consumers legislation in case of making an inappropriate offer/advertisement.
Consumer protection act from unfair trading regulations 2008 (SI 2008/1277), reg.3(4)(d), SCh.1, para.6
Auction sales
General rule: Acceptance of the offer happens only after the fall of the hammer.
The Sale of Goods Act 1979
British Car Auctions Ltd v. Wright [1972] 1 W.L.R. 1519
Payne v Cave [1789] 3 TR 148
General rule: there is no obligation to bound a contract with a highest tender offer, so tenders are usually not an offer.
Spencer v Harding Х[1870] LR 5 CP 561
Exception from the "tender rule"
When
Myths about the offer
If the initiator of the tender states that the highest offer to buy will be bound, the tender will be considered as the offer.
Spencer v Harding [1870] LR 5 CP 563
General rule: The contract is bound after receiving an acceptance. If the offer was misdirected, this is an offerer's fault.
Adams v Lindsell [1818] EWHC KB J59
Sent
Should be
received
Factually
received
2 d delay
Should be
accepted
Factually
accepted
Contract bound
Offer can not to be made to the whole world.
It is possible, but only a limited public will accept that offer on particular conditions.
Carlill v Carbolic Smoke ball Co [1892] 2 QB 484
Inactivity is an offer by conduct
Just inactivity is not enough, it should be combined with other circumstances, even if separately they can not be considered as evidences.
Felthouse v Bindley [1862] EWHC CP J 35
*ITT = Invitation to treat
Topic outline.
What is an offer?
The test of Intention
Some basic rules in the offer
Myths about the offer =)
Difference between an offer and an Invitation To Treat
Display stores, Auctions and Tenders
Literature
Cases
List of used materials
The law of contract : thirteenth edition, Edwin Peel, G. H Treitel, London : Sweet & Maxwell 2011 13th ed.
Contract law, Ewan McKendrick, Palgrave Macmillan law masters, 2013, 10th ed.
Contract law, Mindy Chen-Wishart, Oxford : Oxford University Press 2012 4th ed.
A textbook on contract, T. Downes, London : Blackstone, 1997, 5th ed.
The law of contract, Hugh Collins, 1953, London : Butterworths, 1997 3rd ed.
Cheshire, Fifoot and Furmston's law of contract, M. P. Furmston G. C Cheshire (Geoffrey Chevalier), 1886-1978, Oxford : Oxford University Press, 2012, 16th ed.
Partridge v Crittenden [1968] 1 WLR 1204
Grainger v Gough [1896] AC 325
Consumer protection act from unfair trading regulations 2008 (SI 2008/1277)
The Sale of Goods Act 1979

Acts
by Polina Lobanova, Pre-Masters in Law
ЦWrong.
Adams v Lindsell [1818] EWHC KB J59
British Car Auctions Ltd v. Wright [1972] 1 W.L.R. 1519
Carlill v Carbolic Smoke ball Co [1892] 2 QB 484
Chapelton v Barry UDC [1940] 1 KB 532
Felthouse v Bindley [1862] EWHC CP J 35
Gibson v Manchester City Council [1979] UKHL 6
Grainger & Son v Gough [1896] AC 325
Greville v Venables [2007] EWCA Civ. 878
Harvey v Facey [1893] AC 552 Privy Council
Interfoto Picture Library Ltd v Stiletto Visual
Partridge v Crittenden [1968] 1 WLR 1204
Payne v Cave [1789] 3 TR 148
Programmes Ltd [1989] QB 433
Pharmaceutical Society of Great Britain v Boots Cash Chemists (Southern) Ltd [1953] EWCA Civ 6
Spencer v Harding [1870] LR 5 CP 561-56
Storer v Manchester City Council [1974] 1 WLR 1403

Do you want to be bound?
Yes
No
Offer
Summary
The offer is a basic part of a mutual agreement.
The offer must clearly express the wish of both parties to be bound on clarified terms and conditions.
The contract terms are obligatory for both parties after acceptance of the offer. The offer can be accepted immediately in any legal form.
Advertisement, store display, auction and tender are not an offer, but ITT.
Be aware of exceptions in basic rules.
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