Sara Li
Contracts – MacDougall 2010-2011
Sara Li
FORMATION
Offer & Acceptance
Offer & Invitation to Treat
Mere puffs Invitation to Treat Offer
Mere puff: no reasonable person would take it as an offer
Can the terms of the K (ie offer) only come from one party? * Battle of the forms - last shot/first blow? (Denning in Butler Machine Tool v Ex-Cell-O Corp) * Strict offer & acceptance is reaffirmed in Gibson v Manchester City Council [1979] - only extreme cases might not fit into offer & acceptance model. Denning is rejected. * NZ Shipping Co v AM Satterthwaite [1975] - must accept that sometimes the facts of the case don't fit neatly into offer, acceptance, & consideration * Some Ks require both parties to have input - but the offeror in the end is the one making the offer - so the offeror just incorporates the other party's terms in the offer * Some terms are implied (in many cases, by statute) * Sometimes Ks are created through conduct/performance of a term by a party rather than negotiations * Trentham Ltd v Archital Luxfer [1993] - a K can be concluded by conduct; such a K can impliedly & retrospectively cover pre-contractual performance
Offer vs Invitation to treat – how to tell the difference 1. Have all the details of the eventual K been set out? Are there ambiguities remaining? 1. Would treating a communication as an offer lead to an absurdity? * Eg. if treated as an offer, might lead to too many acceptances (and thus K's) than the offeror can handle.. But this argument doesn’t always hold… Carbolic Smoke Ball [1893] * Invitation is a stmt of readiness to negotiate * Invitation can still have some legal significance: * May be a source of terms that are included in the offer * May be a source of representations or assumptions that can affect the K if they are untrue * May be the source of info that becomes the basis of a claim for certain
Sara Li
FORMATION
Offer & Acceptance
Offer & Invitation to Treat
Mere puffs Invitation to Treat Offer
Mere puff: no reasonable person would take it as an offer
Can the terms of the K (ie offer) only come from one party? * Battle of the forms - last shot/first blow? (Denning in Butler Machine Tool v Ex-Cell-O Corp) * Strict offer & acceptance is reaffirmed in Gibson v Manchester City Council [1979] - only extreme cases might not fit into offer & acceptance model. Denning is rejected. * NZ Shipping Co v AM Satterthwaite [1975] - must accept that sometimes the facts of the case don't fit neatly into offer, acceptance, & consideration * Some Ks require both parties to have input - but the offeror in the end is the one making the offer - so the offeror just incorporates the other party's terms in the offer * Some terms are implied (in many cases, by statute) * Sometimes Ks are created through conduct/performance of a term by a party rather than negotiations * Trentham Ltd v Archital Luxfer [1993] - a K can be concluded by conduct; such a K can impliedly & retrospectively cover pre-contractual performance
Offer vs Invitation to treat – how to tell the difference 1. Have all the details of the eventual K been set out? Are there ambiguities remaining? 1. Would treating a communication as an offer lead to an absurdity? * Eg. if treated as an offer, might lead to too many acceptances (and thus K's) than the offeror can handle.. But this argument doesn’t always hold… Carbolic Smoke Ball [1893] * Invitation is a stmt of readiness to negotiate * Invitation can still have some legal significance: * May be a source of terms that are included in the offer * May be a source of representations or assumptions that can affect the K if they are untrue * May be the source of info that becomes the basis of a claim for certain