Offer and Acceptance

Offer is a crucial element of forming contracts and coming to an agreement without which there can be no contract.

Invitations to treat

Invitations to treat are a collection of disparate instances of situations which can trigger an offer. Essentially their purpose is to solicit an offer or to initiate negotiations. There is no intention to contract immediately but instead to seek an offer from the other party.

Invitations to treat are preliminaries on the road to agreement. An offer, on the other hand, is a promise to be bound. It is capable of acceptance and clear enough to be acted on.

Case Guildford V. Lockyer 1975 Crim. L.R. 235.

The defendant was one of a group of five persons who went to a Chinese restaurant. He ordered but did not receive the correct dish. Instead he ate some of another dish sent to his table. Having tried the food but not liking it, he left the restaurant without paying. He was convicted of the Theft Act 1968 s. 16(1). This was quashed by the divisional court on the basis that there had been no contracts formed to buy the meal in question. The defendant had not received what he had ordered, I.e. “offered” to purchase. The menu was merely an invitation to treat (As well as an invitation to eat, of course).

Merely using the word “offer” does not mean it has that effect legally. It is the legal meaning or construction placed upon it that is important.

Goods on display in shops or supermarkets

Goods on display in a shop window or on a supermarket itself are an invitation to treat, not offer.

Case Fisher V. Bell 1953 1 Q.B. 401

A flick knife (which was an illegal weapon) was displayed in shop window for sale. An offence would be committed if the shopkeeper was offering it for sale. It was held that no offering for sale had taken place, as the goods in the window were merely an invitation to treat and no offence had been committed. The goods on display are an invitation to treat. They are picked up and offered by the customer to the person at the check out to put through her machine to read the bar code and record the sale. This is an acceptance by the store’s employee. There is a contract from this point and ownership passes with it. If the goods are broken or damaged before this, the customer would be legally liable as they will belong to the shop.

Case Pharmaceutical society of Great Britain V. Boots cash chemists Southern LTD 1953 1 Q.B. 401.

The rule on the points of offer and acceptance goes back to the above case in which the divisional court held that the self services system did not amount to an offer by the defendants to sell medicine and drugs, but was merely an invitation to the customer to offer to buy. The offer had been accepted at the cashiers desk under the supervision of a registered pharmacist. There had been no offence committed of selling medicines without correct supervision of a qualified pharmacist.

Catalogues and Advertisements

These are regarded as means of attracting business and therefore are only invitations to treat.

Cases

Grainger & son V. Gough 1896 A.C 325.
Patridge V. Crittenden 1968 2 All E.R. 421
Rooke V. Dawson 1895 1 Ch. 480

Auction sales

The potential buyer makes an offer when she bids. The sale of Goods act 1979 s. 57, provides that a sale is completed by acceptance with the fall of the auctioneer’s hammer. A higher bid knocks out all earlier ones. Lots can be withdrawn at any time until acceptance. Advertising an auction is not an offer to hold it, nor does it bind the auctioneer to sell the goods.

Case Harris V. Nickerson 1873 L.R. 8 Q.B. 286.

If an auctioner refuses to sell the item then it could constitute as a breach of contract.

Case Barry V. Davies 2000 1 W.L.R.

The claimant bid 200 pounds each for two new engine analysers at a sale without reserve. The claimant was the only bidder for the items. The auctioneer defendant withdrew the two engines believing the bid to e unreasonable (their price as new was 14,000 pounds each). The court of appeal held that the auctioneer was obliged to sell the machines to the claimant as a result of a collateral agreement between the auctioneer and bidder and was in breach of contract in failing to do so.