Business Law (mng 4104) Recess Period 2020/2021 Introduction to Law
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| Requirements of a valid offer
Whether a statement amounts to an offer depends upon whether the offeree would reasonably interpret it as an offer. This is an objective test and not a subjective test of what the actual offeree thought. Contract law has developed immensely over time, as such, a number of rules have been laid down to assist in determining whether an offer has been made. A valid offer, therefore – must be communicated by the offeror to the offeree; may be made to a particular person, a group of persons, or as we have learned, to the entire world; must be clear and unequivocal; and must be distinguished from ‘mere puffs’, a request for further information, or an ‘invitation to treat’. Offer must be communicated An offer is ineffective until it is communicated by the offeror to the offeree. If the offeree is unaware of an offer, then it would be impossible to accept it. Case: R v Clarke (1927) (HC) A reward was offered for information leading to the conviction of two persons of two policeman and a suggested pardon might be available to any accomplice not being person to have actually committed the murder. Clarke and another person were arrested in connection with one of the killings. Clarke made a statement and gave evidence, after which the other person who was arrested and one other were convicted for that murder. Nobody was charged with the other murder. Clarke later claimed the reward for the first time. The court found that in giving the information, Clarke did not act “in reliance upon the offer or with the intention of entering into any contract”. While the convictions would not have come about without his evidence, and so the Prosecutor obtained what it he wanted, Clarke gave the information solely to clear himself. Offer may be made to a particular person, a group of persons or to the entire world Case: Carlill v Carbolic Smoke Ball Co. Ltd The plaintiff (Carlill) saw a newspaper advertisement placed by the defendant (Carbolic) claiming that their ‘smoke ball’ would cure all sorts of illnesses including influenza. More importantly, the advertisement also stated that the defendants offered to pay 100 pounds to any person who used one of their smoke balls and then succumbed to influenza within a specified time. The plaintiff purchased their smoke ball and subsequently came down with a nasty bout of the flu. She sued the defendant for the 100 pounds. The defendant argued, inter alia, that an offer must be made bilaterally (that is, an offer cannot be made to the entire world). The court disagreed and held that an offer can be made unilaterally (that is, an offer can be made to the entire world). The offer must be very clear, that is, unambiguous. You must not be left in doubt as to what the terms of the offer are. Offer must be distinguished from ‘mere puffs’, a request for further information, or an ‘invitation to treat’ Offers must be distinguished from non-promissory statements made during the course of negotiations. Objectively, these statements are exaggerated and a reasonable person would not expect them to be true. For example, no reasonable person would believe that a toothpaste can really make teeth ‘whiter than white’. Unilateral and Bi-lateral Contracts A distinction must be drawn between these two. The key difference is bilateral contracts places obligations upon, and grants rights, to all parties. In the case of a unilateral contract, the offeree makes no promise and so is under no duty to do anything. Download 30.14 Kb. Share with your friends:
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