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Contract: Formation

Acceptance, counter-offers and the ending of an offer

  • 3 things to know
  • A2 Units 3 and 4

Overview

Recall questions on counter-offers and requests for information, the battle of the forms, silence and conduct, the postal rule and its limits, instantaneous communication, revocation, and lapse.

What you need to know

Answer each one before you reveal it.

Your recallNot started
Numbers

How may a contract be accepted by conduct?

Key term

State the postal rule established in Adams v Lindsell (1818).

Key term

State three conditions that must be satisfied before the postal rule can apply.

Questions from this subtopic

Each one with the model answer underneath.

  1. 1

    Define acceptance in the law of contract.

    Model answer

    Acceptance is a final and unqualified assent to all the terms of the offer, which must correspond exactly to the offer and must generally be communicated to the offeror.

  2. 2

    What did Hyde v Wrench (1840) decide about a counter offer?

    Model answer

    It decided that a counter offer destroys the original offer, so once the buyer had offered nine hundred and fifty pounds in reply to the asking price of one thousand pounds he could not later accept the original figure.

  3. 3

    What did Stevenson Jaques and Co v McLean (1880) decide about a request for information?

    Model answer

    It decided that a mere inquiry about the terms, such as whether delivery could be spread over a period, is not a counter offer and leaves the original offer open for acceptance.

  4. 4

    How did Butler Machine Tool v Ex-Cell-O Corporation (1979) resolve a battle of the forms?

    Model answer

    The court treated each party's standard terms as a counter offer, and held that the buyer's terms governed because the seller had signed and returned the buyer's tear off acknowledgement slip, firing the last shot.

  5. 5

    What did Felthouse v Bindley (1862) decide about silence as acceptance?

    Model answer

    It decided that an offeror cannot impose acceptance by silence, so a statement that the horse would be treated as sold unless the seller replied did not create a contract when no reply was sent.

  6. 6

    How may a contract be accepted by conduct?

    Model answer

    Conduct that can only sensibly be explained as assent to the offered terms will amount to acceptance, as in Brogden v Metropolitan Railway (1877) where both sides performed a draft agreement that had never been formally returned.

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