Offer and acceptance (battle of the forms)
For a contract to be binding there must be an agreement which is made up of two parts; offer and
acceptance. If offer and acceptance are present then there will be an agreement.
An offer is defined as:
- ‘an expression of willingness to contract on certain terms, made with the intention that it
shall become binding as soon as it is accepted by the person to whom it is addressed’.
(Treitel, The Law of Contract – confirmed in Allied Marine transport v Vale (The Leonida)).
o It is important to recognise that an offer is entirely separate to an Invitation to treat
and the two must be distinguished; an invitation to treat is merely made without
intention to be bound by specific terms and examples include:
▪ Self-service display in shops – Pharmaceutical society of Great Britain v
Boot's cash chemists.
▪ Goods on display – Fisher v Bell
▪ Tenders (Spencer v Harding) unless it is a unilateral contract, in which case it
will be an offer (Harvala Investments Ltd v Royal Trust Company of Canada)
▪ Advertisements (Partridge v Crittenden) unless a reward is being offered
(Williams v Carwardine) or unilateral contract is formed, in which case
acceptance need not be communicated (Carlil v Carbolic smoke ball Co).
Acceptance is defined as:
- ‘an unconditional expression of assent to the terms of an offer’.
- AND Acceptance must be communicated:
o General Rule – acceptance must be communicated and should be communicated by
the offeree (Entores v Miles far East corp) or authorised agent (Powell v Lee).
o Exceptions arise if there is a unilateral contract (Carbolic Smoke case) or if the
contract states that silence constitutes acceptance – silence cannot constitute
acceptance according to Felt house v Bindly, unless there is no reason for the offeree
not to bind themselves (Re select move Ltd).
There can be an objective approach to agreement (Smith v Hughes) but with a subjective element to
it (The Leonidas) – what the offeror does/says is looked at objectively but the offeree must actually
believe that his conduct/what he says represents his actual intention.
- The ‘intention’ referred to in the definition does not necessarily mean the offeror’s actual
intention. The courts adopt what is primarily an ‘objective’ approach to deciding whether
there was agreement between the parties (Smith v Hughes) but adopt a subjective element
from the case The Leonidas.
If the response is qualified it will be a counter offer and destroy the original offer – Hyde v Wrench.
Compare with a mere request for info. – Stevenson v McLean.
- Qualification – questions about an offer are not deemed as rejecting t and it may still be
acceptance if it falls within definition (Stevenson Jacques & Co. V McLean)
Explain what is meant a ‘battle of the forms’ and how and why the last shot often wins.
For a contract to be binding there must be an agreement which is made up of two parts; offer and
acceptance. If offer and acceptance are present then there will be an agreement.
An offer is defined as:
- ‘an expression of willingness to contract on certain terms, made with the intention that it
shall become binding as soon as it is accepted by the person to whom it is addressed’.
(Treitel, The Law of Contract – confirmed in Allied Marine transport v Vale (The Leonida)).
o It is important to recognise that an offer is entirely separate to an Invitation to treat
and the two must be distinguished; an invitation to treat is merely made without
intention to be bound by specific terms and examples include:
▪ Self-service display in shops – Pharmaceutical society of Great Britain v
Boot's cash chemists.
▪ Goods on display – Fisher v Bell
▪ Tenders (Spencer v Harding) unless it is a unilateral contract, in which case it
will be an offer (Harvala Investments Ltd v Royal Trust Company of Canada)
▪ Advertisements (Partridge v Crittenden) unless a reward is being offered
(Williams v Carwardine) or unilateral contract is formed, in which case
acceptance need not be communicated (Carlil v Carbolic smoke ball Co).
Acceptance is defined as:
- ‘an unconditional expression of assent to the terms of an offer’.
- AND Acceptance must be communicated:
o General Rule – acceptance must be communicated and should be communicated by
the offeree (Entores v Miles far East corp) or authorised agent (Powell v Lee).
o Exceptions arise if there is a unilateral contract (Carbolic Smoke case) or if the
contract states that silence constitutes acceptance – silence cannot constitute
acceptance according to Felt house v Bindly, unless there is no reason for the offeree
not to bind themselves (Re select move Ltd).
There can be an objective approach to agreement (Smith v Hughes) but with a subjective element to
it (The Leonidas) – what the offeror does/says is looked at objectively but the offeree must actually
believe that his conduct/what he says represents his actual intention.
- The ‘intention’ referred to in the definition does not necessarily mean the offeror’s actual
intention. The courts adopt what is primarily an ‘objective’ approach to deciding whether
there was agreement between the parties (Smith v Hughes) but adopt a subjective element
from the case The Leonidas.
If the response is qualified it will be a counter offer and destroy the original offer – Hyde v Wrench.
Compare with a mere request for info. – Stevenson v McLean.
- Qualification – questions about an offer are not deemed as rejecting t and it may still be
acceptance if it falls within definition (Stevenson Jacques & Co. V McLean)
Explain what is meant a ‘battle of the forms’ and how and why the last shot often wins.
