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| Only the offeree may accept the offer. Give authority. | Boulton v Jones (1857) FACTS: Boulton took over the running of a shop. Jones, who was a long-standing customer of the previous owner, Brocklehurst, placed an order. Boulton fulfilled the order, and invoiced Jones. Jones refused to pay. Held: The court held that the offer had been made to Brocklehurst, and not Boulton, and as such Boulton could not accept it. James Bolton (with a t-shirt with a big U on the front) buys a shop off Tom Jones. I left a note offering to do a gig for Tom, but James is there now. He can't accept my offer. |
| Provided there is knowledge of the offer when the offeree makes their acceptance, it doesn’t matter what the motivation is for the acceptance. |
Williams v Cawardine [1833]
Facts: Cawardine had been murdered, and the family were offering a reward for information, leading to arrest and conviction. Williams was an elderly lady on her deathbed, who had knowledge of the murderer. She was aware of the reward. Her motivation for giving information about the killer was a desire to avoid eternal damnation. She offered up the information, and died shortly thereafter. Her family tried to claim the reward.
Held: The court held that, given that Williams knew of the reward at the time of completion of the prescribed act, her estate was entitled to it, even if that was not Williams’ motivation. Does this relate to the fact that the tests for offer and acceptance of the contract are objective, and not subjective?
John Williams from York is dressed up as an old lady. She was confessing that she knew about the murder of the coward Cawardine (who had a big A on his T-shirt). She knew about the reward, but didn't care.
Image:
Coward (binary/octet-stream)
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| You must have the offer in mind at the time of acceptance. | R v Clarke [1927] The Australian government offered a reward for information leading to the arrest and conviction of murderers involved in the murder of two policemen. The defendant, Clarke was part of a criminal gang who had been involved in the murders, and had been arrested on another matter. During an interview, he gave information about his accomplice. He did this in order to enjoy a more lenient sentence, he had forgotten about the reward. He later tried to claim the reward. Held: The court held that he had not acted in reliance of the offer, and could therefore not benefit from it. The Queen against one Clarke(s) shoe. The shoe happened to mention the whereabouts of the other shoe. It's not allowed because it was a coincidence that the other shoe had a reward on it's head. The first shoe didn't know. |
| An interesting specific set of facts relating to providing information for reward. A delay because of an agent. | Gibbons v Proctor (1891) Facts: Gibbons told his senior officer to tell the superintendent about information regarding a murder. Shortly thereafter an offer of reward was made for said information. It took 24 hours for the information to reach the superintendent. By the time the information reached the superintendant, Gibbons knew about the reward. Held: Gibbons was allowed to collect the reward, as the senior officer was regarded as an agent of Gibbons, and Gibbons knew about the offer at the time the information was communicated. Polly Gibbons is the police officer. The Superintendant is Heather Procter. Gibbons sang the information, and the senior officer passed on the song about the criminal. The lyrics changed to reflect the reward by the time they reached Procter. |
| The only person entitled to the reward is the individual who first gave that information. | Lancaster v Walsh (1838) Held: In this case, only the first person to provide the information was entitled to the reward. Whether more than one person may claim the reward will depend on how the offer of reward is phrased. |
| Acceptance must be a 'mirror' of the offer - Counter offers kill the original offer | This is often referred to as the mirror image rule. A counter offer 'kills' the original offer. Hyde v Wrench (1840) FACTS: Wrench offered to sell his house for £1000, Hyde made a counter offer of £950. Wrench didn't reply. Hyde then said 'ok, I'll buy for £1000' and Wrench refused to sell. HELD: Having made a counter-offer of £950, Mr Hyde could not subsequently resurrect the original offer and accept it; the original offer had been 'killed off' by the counter-offer. Two things happen: the original offer is killed off, and a new offer takes place (going in the reverse direction). horse hide being hit by a wrench. In 1840 NZ is founded, this all happens in NZ. |
| Case that demonstrates the difference between a counter offer and a request for further information. | Stevenson, Jacques & Co v McLean (1880) FACTS: McLean offered to sell something. Stevenson, Jacques and co asked if they would be willing to accept payment in instalments. McLean ignored and sold to someone else. S,J sued. HELD: The request was not a counter offer, due to the language it was couched in - it was a tentative question. Therefore a request for further information. AID: Olivia Stevenson and Jacques Attali have a company. They are suing a very lean and muscular scotsman, McLean. Jacques, in his very French and tentative way, was asking for more time to make payment to McLean. McLean claimed that was a counter offer, but it wasn't. Jacques is far too clever. In 1880 Greenwich meantime is adopted. Stevenson &Jacques were requestion information about timings. |
| Battle of forms / T&Cs in multiple counter offers | Butler Machine Tools v Ex-cell-o Corporation (1979) FACTS: Butler made an initial offer to sell some tools to Ex-cell-o. In Butler's T&Cs was a clause stating they could vary the price up to the date of delivery. However, Ex-cell-o bought the tools by sending a fixed price on a form, with a tear-off slip, for Butler to return stating that they 'accept the offer' on Ex-cell-o's T&Cs. HELD: Ex-cell-o's fixed-price form constituted a counter offer, as per Hyde v Wrench. This resulted in the principle of the 'battle of forms' wherein the last person to lay down terms that are accepted is the offeror, and their terms overide any other terms. Johnny Butler is selling a giant machine tool to a singing former convict (Ex-cell-o). The convict wins, because he's a clever trickster! This happened with Margaret Thatcher winning the election in the background. |
| Postal Rule | Acceptance by post is effective at the time of "proper posting". Adams v Lindsell [1817] Facts: On 2 Sep, the Lindsell wrote to Adams offering to sell some wool. The letter was only received by the Adams on 5 Sep since the Lindsell had misaddressed it. Adams posted an acceptance that evening. The acceptance was received by the Lindsell on 9 Sep. However, on 8 Sep, the Lindsell had sold the wool to a third party. Held: The court held that the acceptance of 5 Sep was effective when posted; thus, there was a binding contract. Otherwise, if a posted acceptance needs to be received before it is effective, how would the offeree know when their acceptance had been received? Would the offeree need to confirm? There is a risk that confirmations would be required ad infinitum. Such a state of affairs would make the conclusion of a contract by post impossible. Lint (wool) sell, become Lindsell. Adams - Adams family. Adams family want to buy huge amounts of black wool from Lindsell. Lindsell address it to the wrong creepy mansion, and it takes ages. Adams family reply, and takes ages. |
| POSTAL RULE: What constitutes “properly posted"? | Re London and Northern Bank, ex p. Jones [1900] Held: A letter is properly posted when it is put into an official letter box or into the hands of an employee of the Post Office who is authorised to receive letters. It is not properly posted by putting it into the hands of a postman who is only authorised to deliver letters. imagine a giant bank that stretches from London up North. Tom Jones is posing an acceptance of a loan, but is pretty lazy and says to the postman "Oh. Can you take my later? Yeah!" He didn't give it to the right person in the right place, so it's not a valid acceptance. |
| POSTAL RULE: What if the letter is lost or destroyed? | Household Fire and Carriage Accident Insurance co v Grant [1879] Facts: Grant made an offer to buy shares. This was accepted by Household Fire, and Grant's name was put on the list of share holders. Household Fire sent out a letter of acceptance that never arrived, despite being correctly addressed and posted. Household Fire went bankrupt. The liquidator wrote to Grant demanding money for his unpaid shares. Grant replied that he had never received an acceptance. Held: Grant’s offer have been excepted, despite the fact the acceptance never arrived. The liquidators sued for the outstanding money, and Grant was found liable. Household Fire v Grant. Household Fire destroyed in a fire (obvs). Grant is Russell Grant the astrologist. Of course the acceptance never arrived, everything burned. The letter spontaneoulsy combused and the company burned down. |
| POSTAL RULE: What is the letter of acceptance is misaddressed? | Then you do not get the advantage of the postal rule. Getreide-Import Gesellschaft v Contimar [1953] Facts: This case involves an appeal against and arbiters decision, and the appeal needed to be lodged within 14 days. The appeal was sent on the 12th day, but because it was not correctly addressed, it arrived after the 14 day limit. Held: It was declared invalid. The negligence of the acceptor displaced the postal rule. GIG v Contimar [1953]. They sent it late because they were too busy gigging. Contimar Counted and marked the days, waiting for the letter. GIG was so tired because of the gigging, he got the address wrong. |
| POSTAL RULE: The postal rule only applies if it’s reasonable to use the post. When is it 'reasonable' to use the post? | We take our cue from the offer. If an instantaneous method is used to make the offer, then it’s reasonable to use a simultaneous method for the acceptance. Or where there is no urgency, post may be ok. Where timings is key, e.g. shares, post not ok. Henthorn v Fraser [1892] Facts: offer made in person to sell property to Henthorn, who replied by post accepting, 2 hours before receiving a letter revoking the offer. Fraser said, as the offer was made in person, it was not reasonable to accept via post. Held: Court considered if the parties would have contemplated post an option for communication - they lived in different towns, so reasonable that acceptance might be communicated by post - postal rule allowed. Implies that if it was not considered reasonable to communicate by post, say, due to a well publicised postal strike, that the postal rule not ok. Hen with thorn in it's foot receives offer from Ros Fraser to buy property in person. The hen flies away to think about it. Ros sends a revocation at 12pm, the hen sends an acceptance at 3pm, the revocation arrives at 5. |
| Ousting the Postal Rule | Holwell Securities v Hughes Facts: Hughes wanted to buy some shares, so he made an invitation to treat to Holwell Securities. Holwell replied with an offer of some shares. The offer stated that Hughes had a period of time to decide before the offer closed. They stated that they required ‘notice in writing’ of his acceptance. Now, in legal terms ‘notice’ means ‘sight of’, so they had to actually see the acceptance. This is a way of ‘ousting’ the postal rule LJ Lawton stated that if the postal rule had applied, it would have caused inconvenience and absurdity. He said it was obvious no parties could have expected a binding agreement until the acceptance had been communicated. We see from Holwell that you can ‘oust’ the postal rule by requiring receipt. The obiter of Household Fire v Grant [1879] also stated “your letter is only to bind if it reaches me” was enough to oust postal rule. Imagine Tim Howell in a security jacket. Rob Hughes wants to buy some shares. You know Tim, he's such a stickler, he required 'sight' of the acceptance, and thus ousted the postal rule. T hates R's sax |
| Revocation occurs when the offeree becomes aware SO IS ONLY VALID FROM THE MOMENT COMMUNICATION REACHES THE OFFEREE | Byrne v Van Teinhoven (1880) FACTS: Teinhoven revoked an offer, but the revocation arrived AFTER Byrne had posted his acceptance. HELD: The postal rule states that acceptance occurs at the time of posting. However, the opposite applies to revocations. They must be received to be valid. AID. Burning van that's a tin oven. The tin van oven was too slow to reach byrne to revoke, so Byrne's acceptance held. 1880 when Greenwich meantime was adopted - when it comes to revocation - it's all about timing. |
| POSTAL RULE: Can the offeree withdraw the acceptance once it has been sent? | One view is ‘yes’, the offeror is none the wiser, other veiw is that this gives the offeree a double advantage. Most of the case law says offeree cannot withdraw the acceptance once sent. One exception: Dunmore v Alexander [1830] Facts: The Countess of Dunmore received an application from Alexander to work as the Countess’s lady maid. The countess decided she wanted to accept, so she posted an acceptance. However, the countess then changed her mind and sent a retraction by express post. Held: Scottish Court held that the revocation was valid as it arrived before the acceptance - but surely this ruling is wrong. It seems unfair. It gives the offeree the advantage - both of the postal rule, and the ability to retract. Dunmore has been disapproved of by the later Scottish case Thomson v James [1855] and the NZ case Wenkheim v Arendt [1973] so Dunmore really stands on its own. She couldn't have 'done more' to retract her acceptance. If you Alex-hand-her the rejection befor the offer, it will count. But only in a 19th century Scottish Court. |
| You can strictly prescribe means of acceptance ONLY if you use mandatory language. | If the offeror wishes to receive acceptance via email, he should say “acceptance must be via email, and cannot be oral or any other mode“, he cannot just say “please send your response by email”. If the offeror requires a specific mode of communication, and uses mandatory language, only an acceptance via that mode will be binding. Manchester Diocesan Council for Education v Commercial and General Investments [1970] Facts: MDC offered had some property for sale and invited tenders. A condition in the request for tenders stipulated that the acceptance of the successful offer would be 'sent to him by post addressed to the address given in the tender'. MDC communicated acceptance by a different means. The defendant got the communication. They didn't communicate to the stated address until 5 months later. The defendant claimed the offer had expired by that time. Held: The fact that MDC (offeree) had stipulated the method of acceptance was key. It wasn't stated by the offeror (CGI) as a condition of the offer. There was no explicit demand of method in the offer, thus any other ok. |
| If modes of communication are not explicitly excluded you can use equally advantageous methods | Yates Building Co. Ltd v Pulleyn & Sons (York) Ltd (1975) Facts: Pulleyn specifed that acceptance shoul be by 'registered post' and Yates accepted by normal post. The letter arrived on time. Held: The requirement that acceptance should be sent by registered post was for the offeree's advantage. The offeree can waive this advantage and it will not invalidate a successful acceptance. Aide: Accy Yates ("I sent the letter, 'd'ya know wha I mean?"). Pull-eyn = "Pull-in" by registered post. |
| The general rule is that acceptance must be communicated to the offeror. | Acceptance applies from the moment it is communicated. Where the offeree merely intended to accept, but did not communicate his intention to the offeror, there is no contract, i.e. mental assent not enough. Also, the offeror may not stipulate that he will take silence to be acceptance. Felthouse v Bindley [1862] Facts: this case involved and uncle, a nephew, and an auctioneer. The uncle is Felthouse. The uncle was interested in a horse being sold by his nephew. The nephew wants £31.50 for this horse, the uncle wants to pay £30. The uncle comes back and says “I’ll meet you halfway, let’s call it £30.75, and if I hear no more about it, I’ll consider the horse mine“. The nephew didn’t respond, as he was busy at an auction. The nephew told The auctioneer, Bindley, to leave the horse out of the auction. Bindley kept the horse in the auction, and sold it to the highest bidder. Felthouse then sued the auctioneer. He stated that his nephew had already sold the horse to him. To prove this, the uncle had to show that the nephew had provided a valid acceptance of his offer. |
| Acceptance may be communicated by a third-party authorised by the offeree. | Powell v Lee [1908] Facts: Powell applied to be the headmaster of the school. The committee met and decided to give him a job. They did not communicate this to him straightaway. One of the committee told Powell he had got the job, but this individual had not been authorised by the committee. The committee then withdrew their acceptance. Held: Powell had offered to fill the role of headmaster, but the acceptance he received had not been authorised by the committee, thus the court held that the requirements of a binding contract had not been fulfilled. Baden-Powell offered to be head karate teacher at Bruce Lee's karate school. One of the enthusiastic pupil's told BP that he had the job, but they had not been authorised by Bruce Lee, so it was not valid. |
| Instantaneous communication. When does agreement occur, what are the four principles outlined by Denning in this case? | Entores v Miles Far East Company Facts: where does agreement occur with telex communications? Held: The point of acceptance with instantaneous communications is the point it is received. Not when it is read, but when it is accessible - so when the email arrives, not when it is read. This is known as the receipt rule. Denning LJ established that for instantaneous communications: 1.The general rule is that acceptance must be communicated in order to be effective. 2.If the acceptance is not communicated through the fault of the offeree, there will be no contract. 3. If the acceptance is not communicated through the fault of the offeror, he will be estopped from denying that the acceptance was received and there will be a contract. 4.If the acceptance is not communicated and there is no fault on the part of either party, there will be no contract. |
| Mondial Shipping and Chartering BV v Astarte Shipping Ltd [1995] | Facts: the plaintiffs had hired a ship. They had until midnight on Friday to pay the balance of the hire, and at 23.41 the hire company messaged cancelling the plaintiffs cancelling the order on account of non-payment. Held: the message, as sent outside office hours can not be deemed to have arrived until 9am on Monday morning. |
| Thomas v BPE Solicitors [2010] | Facts: acceptance was sent by email at 18:30 on a Friday evening. The defendant had left the building early as it was a warm Friday in summer. Held: Office hours are normally from 9-5:30, however the court said that it was important to look at how the parties had communicated in the past, and in this case it was clear that they had regularly communicated at this time in the evening, and so the court deemed it reasonable to access the communication at that time. |
| The Brimnes [1975] | Held: if an instantaneous communication arrives within office hours (this is not clearly defined but is roughly between 9am-5.30pm) then acceptance definitely arrives at the point of receipt, whether read or not. If however, it arrives outside of office hours, the case requires closer analysis. |
| Brinkibon v Stahag Stahl [1982] | Held: Wilberforce LJ stated that there was no universal rule. If there was a failure of communication, factors such as intentions, found business practices, where the risks lie should inform the judgment. |
| If modes of communication are not explicitly excluded you can use equally advantageous methods | When deciding whether an alternative mode is equally advantageous, we must look at the purpose for which the mode was prescribed. We don’t guess that the purpose, it’s the responsibility of the offeror to make clear the purpose in his offer Tinn v Hoffman and co [1873] You can use any equally advantageous method |
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