Contract - Essay Example

Download file to see previous pages For example, in the case of Gibson v Manchester City Council7, the words “may be prepared to sell” constituted an invitation to treat and not a distinct offer. Indeed, the Gibson decision challenged the traditional view for formation of contractual agreement. In this case, Lord Denning asserted that when considering whether there is a binding contractual agreement, it could be argued that “there is no need to look for strict offer and acceptance. You should look at the correspondence as a whole and at the conduct of the parties and see therefore whether the parties have come to an agreement on everything that was material8”.
However, there has been some uncertainty in this area of law as evidenced by the case of Carlil v Carbolic Smoke Ball Limited9. In this case, the defendant was the proprietor of a medical substance and placed and advert in the Pall Mall Gazette promising to pay $100 to anyone who used the carbolic smoke ball for two weeks and who for a limited time after contracted the flu virus. Carbolic Smoke Ball Limited argued that the advert did not constitute an offer but was rather an invitation to treat.
The Court of Appeal rejected this argument and held that there was a legally enforceable contract. The advertisement constituted an offer to the whole world and was capable of amounting to an offer of a unilateral contract without the requirement for acceptance. The Carlil decision had far reaching implications for contract law, with some commentators arguing that there is no difference between an “invitation to treat” and a contractual “offer”10.
However the facts of the current scenario indicate that Owen’s letter was a distinct offer to sell the car to Andrew for £30,000 and the central issue in contention is whether Andrew accepted Owen’s offer to create a binding contract.
Valid acceptance in law follows a ...Download file to see next pagesRead More