Business Law Essay Example | Topics and Well Written Essays - 1250 words

Business Law - Essay Example The problem in this question relates to offer, unilateral offer, invitation to treat, acceptance, rejection of offer and past consideration. These would be discussed in line with the facts and determination of conclusion of the issues would be made in accordance with that. The important aspect in respect of the question is that of the differentiation between an offer and invitation to treat. This has been drawn by the courts. Invitation to treat is an expression of willingness of one party to go into into negotiations with another party anticipating that a contract would be concluded at the end of such negotiations. Items on shop display and their prices are treated as an invitation to treat (Fisher v Bell). Advertisements are generally treated as invitation to treat (Harris v. Nickerson ). There are certain exceptions to this the reasoning based on intention and certainty. (Carlill v Carbolic Smoke Ball Co, a case on unilateral offer.)1. An offer on the other hand has been defined a s an unequivocal willingness by a party known as the offeror to enter into a contract on stated terms and provided that such terms would be accepted by the person to whom the offer is made (offeree) a contract would come into existence. Acceptance has been defined as the unconditional acquiesce to the terms that were laid down by the offeror. The important aspects of acceptance are that it should be unconditional and must be communicated to the. ( Holwell Securities v. Hughes2) . A number of exceptions have developed in respect of communication, one of them being the postal rule, whereby acceptance takes place as soon as a letter is posted. As far as instantaneous means of communication is concerned it can be said that the postal rule in Adams v. Lindsell3 of acceptance is not applicable and thus actual communication of acceptance needs to be done (Mondial Shipping and Chartering BV v. Astarte Shipping Ltd4). As far as silence constituting to be acceptance is concerned, the courts h ave been consistent in their approach that silence would not constitute as acceptance and acceptance needs to be communicated or can occur by way of conduct. (Felthouse v. Bendley)5 . The advertisement that was placed cannot be classified as a unilateral offer as the facts do not show the requisite certainty and unconditional offer, thus it is evident that the advertisement is an invitation to treat. The discussion with Rose was merely an invitation to treat as there was hope of a contract being concluded and at no point can it be seen that an offer been made, so there can be no acceptance. In line with the discussion with Mary, the offer of Rose was made and communicated to Mary, however, the problem lies in the fact that even though there Mary responded and accepted the offer, it was never communicated to Rose and so in line with authorities on instantaneous communication it can be concluded that acceptance did not take place and so no action can be brought about by Rose. As far a s Matthew is concerned, the problem lies in the fact that it was conditional on the fact that Matthew would receive payment and therefore a conditional offer, or in other words it was not a conclusive offer which could be accepted. Applying the approach of courts in respect of silence and that it would not constitute to be acceptance; the actions of John cannot in any way create a binding contract. Furthermore, there has been no actions or conduct which show acceptance, on the contrary Mary destroyed the cheque which shows her intention of not being bound. The next issue is in respect of consideration, which is that it must generally be given after promise so as to make it enforceable. Thus a promise made after alleged consideration is complete is unenforceable (Re Mcardle)6. Thus past consideration is generally held not to be good consideration. However, the courts in Pao On v. Lau Yiu Long whereby Lord Scarman laid down the three condition which were to be satisfied if the excepti ons were to be relied upon, the first being that the act which was done