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Law · Contract

Contract law: offer and acceptance

An offer is a definite promise to be bound on certain terms. It can be made to one person or to the whole world (Carlill v Carbolic Smoke Ball Co, 1893 — advert promising £100 was a unilateral offer, accepted by performing the conditions).

An invitation to treat is NOT an offer: goods displayed in a shop window (Fisher v Bell, 1961), goods on shop shelves (Pharmaceutical Society v Boots, 1953), most adverts (Partridge v Crittenden, 1968).

A counter-offer destroys the original offer (Hyde v Wrench, 1840). A mere request for information does not (Stevenson v McLean, 1880).

Acceptance must be communicated to the offeror. Silence cannot amount to acceptance (Felthouse v Bindley, 1862). Instantaneous communications take effect when received (Entores v Miles Far East, 1955).

The postal rule: acceptance by post takes effect when the letter is posted, not when it arrives (Adams v Lindsell, 1818), provided post was a reasonable method of acceptance.

Revocation of an offer must be communicated before acceptance, and can come through a reliable third party (Dickinson v Dodds, 1876).

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Q1/5A shop displays a flick knife in its window with a price tag. In law, the display is:

Q2/5Wrench offers to sell his farm for £1,000. Hyde replies offering £950. What is the effect of Hyde's reply?

Q3/5When does an acceptance sent by post usually take effect?

Q4/5In Felthouse v Bindley, the uncle said 'If I hear no more, I consider the horse mine.' Why was there no contract?

Q5/5Which case shows an advert can be a unilateral offer to the whole world?

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Q1/5A shop displays a flick knife in its window with a price tag. In law, the display is:

Q2/5Wrench offers to sell his farm for £1,000. Hyde replies offering £950. What is the effect of Hyde's reply?

Q3/5When does an acceptance sent by post usually take effect?

Q4/5In Felthouse v Bindley, the uncle said 'If I hear no more, I consider the horse mine.' Why was there no contract?

Q5/5Which case shows an advert can be a unilateral offer to the whole world?

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