Aspects of contracts and negligence - Assignment Example

If it is accepted then a contract is made. In Gibson v Manchester City Council - CA [1978] 1 WLR 520, Manchester City council was being managed by Conservative Party which worked with a policy of selling city council’s premises. Gibson made an application for information of his house and terms of mortgage on the council’s form (McKendrick, 2005; p. 47). The council replied by stating that it was prepared to sell the house at a purchase price of £2,725 less 20% = £2,180 which was not to be taken as an offer.

Gibson filed in the application form with the exception of the purchase price and took it back to the council. The labor party took over and stopped all the sales where Gibson was informed that he could not complete the contract. Gibson sued the council on claims that the contract was already executable. It was ruled by the House of Lords there existed no contract because the parties had not come to a material agreement of the contract. For a valid contract to be executed, the offer must be accepted by the other party.

The acceptance must be conveyed to the offeree, the agreement must be assured and the terms of accepting the offer must be precisely the same to the terms contained in the offer. In Entorres v Miles Far East [1955] 2 QB 327 the plaintiff delivered a telex message from England promising to buy 100 tons of Cathodes from Miles Far East in Holland. A telex message was sent back to the petitioner from Holland to England accepting the terms of the offer (McKendrick, 2005; p. 51). The issue was for the court to determine the point at which the contract was executable.

In case the acceptance was valid from the time the telex message was delivered the contract was created in Holland hence Dutch law would come into force. In case the telex message of acceptance took place upon the receipt in England the agreement would be presided over by English law. It was held that; to amount to a valid acceptance the acceptance was required to be