Contract Law, Case Study - Coursework Example

5 if “horse was lucky for him.” It was held that this statement was too vague to become a valid offer. The buyer did not clearly state that in what way the horse should have been lucky for him. There are also statements made that are mere queries for more information. Such statements also do not become a valid offer. In Harvey v Facey2, the plaintiff was interesting in buying land which had not been advertised for sale by the owner, the defendant. The plaintiff asked the defendant for the lowest price that he would be accepting for the land.

The defendant replied with a price and the plaintiff tried to accept it. It was held that the plaintiff could not accept that price because there was no offer by the defendant. There was a price but no intention to sell the land in the reply of the defendant. It was just an early step in the process of negotiation. An offer is meant to be the last word of the parties to a contract. This is why a counter-offer revokes the original offer. In Hyde v Wrench3, the defendant offered to sell his land to the plaintiff for ?1000. The plaintiff said that he would pay ?

950 instead. Later, he agreed to pay the full price but heard nothing from the defendant. It was held that the offer to sell the land at ?1000 had expired when the plaintiff made a counter-offer. Therefore, the original offer was no longer open for acceptance. It is essential that both parties must agree to the same thing in the same sense. An offer must be communicated to the offeree. It is deemed to be communicated to the offeree when it comes into his notice. The offeror can put a stipulation on his offer regarding its acceptance in time.

If the offer is not accepted within that time, it is revoked. An offer can be revoked at any time before it has been accepted. If an offeree wants the offeror to keep an offer open for acceptance, he must pay a consideration for it. In Routledge v Grant4, the defendant promised to keep his offer to purchase the lease of the plaintiff’s house open for acceptance for six weeks. He changed his mind and communicated to the plaintiff that he had revoked his offer. The plaintiff claimed that the defendant was bound to keep his offer open and he had breached his promise.

It was held that the defendant was not bound to keep his offer open because the plaintiff had not paid him any consideration for it. It is important to note that such revocation of offer is not valid unless it is communicated to the offeree. Acceptance is the next step in the formation of a legally binding contract. Acceptance must be a mirror image of the offer in the sense that the acceptor must agree to the same things that are presented in the offer in the same sense. In Jones v Daniel5, the plaintiff sent an acceptance message to the defendant in which he included new terms.

The defendant refused to enter into a contract. It was held that the acceptance was a qualified acceptance and not valid. It was a counter-offer and the defendant was not bound to accept it. An offer may be conditional but it is not the case for acceptance. An acceptance must be firm and absolute. There must also be a consideration for both parties to a legally binding contract. Consideration can be regarded as the price of a party’s promise. Consideration must be sufficient. It must be of a material value.

Also, the parties must have an intention to be legally bound under the agreement. If there is no such intention, the