Contract - formation

Question 1

Agreement

When will an offer become binding?

Answer 1

As soon as accepted by the person to whom addressed

Question 2

Agreement

Is an advert an offer or an invitation to treat?

Answer 2

Usually an invitation to treat; will be an offer if constitutes a unilateral contract, e.g. offer of a reward

Question 3

Agreement

Auctions.
1. request for bids
2. when is the contract formed?
3. between whom?
3. if reserve price?
5. if no reserve price?

Answer 3

1. request for bids = invitation to treat
2. contract formed when gavel goes down
3. once gavel goes down, if auctioneer is agent, contract between buyer and seller
4. no contract if reserve price is not met
5. if auctioneer says ‘I’ll sell this to highest bidder’, then auctioneer is bound to sell to highest bidder

Question 4

Agreement

Who will be bound by an auctioneer’s unilateral offer to sell to highest bidder?

Answer 4

The auctioneer - not the seller

Question 5

Agreement

Tenders (3)

Answer 5

1. Requests for tenders are invitations to treat
2. Tenders are offers
3. If offer to accept the lowest tender, then it’s an offer of a unilateral contract

Question 6

Agreement

What’s acceptance? Who must undertake?

Answer 6

Unqualified expression of assent.
By offeree or authorised agent

Question 7

Agreement

How will be a unilateral offer be accepted?

Answer 7

Always by conduct

Question 8

Agreement

How can acceptance be communicated?
Silence?

Answer 8

By words or by conduct
As a general rule, no. Might be if coupled with conduct that clearly signifies acceptance

Question 9

Agreement

What kind of wording can exclude the postal rule?

Answer 9

‘notice in writing’ - meant that the acceptancec actually had to arrive with D

Question 10

Agreement

Requirements for application of the postal rule

Answer 10

a) reasonable in all circumstance to use post
b) properly stamped, addressed, and sent
c) postal rule not excluded by offeror

Question 11

Termination of an offer

Four means of termination

Answer 11

1) Rejection
2) Counter-offer
3) Revocation
4) Lapse of time

Question 12

Termination of an offer

Rejection

Answer 12

Can be express or implied. Counter-offer is an implied rejection

Question 13

Termination of an offer

Who must revoke an offer?

Answer 13

Either the offeror, or a reliable third party

Question 14

Termination of an offer

How can offer made to the public at large be revoked?

Answer 14

Revocation must be in the same place, with the same prominence

Question 15

Termination of an offer

Does postal rule apply to revocation?

Answer 15

No

Question 16

Termination of an offer

Revocation - what if offeror promised to keep offer open for a certain period of time?

Answer 16

Can still be withdrawn at any time, unless offeree provided consideration for offer being kept open.

Question 17

Termination of an offer

When will an email revoking an offer be effective?

Answer 17

When it should have been read, e.g. if sent during normal business hours

Question 18

Agreement

What is the requirement for certainty for the purposes of an agreement?

Answer 18

All materials terms agreed, or clear understanding of what they are.