OFFER

BY
MS. ZIMBA
 INTRODUCTION
• Contracts form the basis of most common relationships.
• Contract law has developed mainly through judicial
precedence especially English case law.
• A contract is an agreement or promise entered into
with the intention of creating an obligation to do or to
refrain from doing a particular thing.
• An obligation is a juristic/ legal bond in terms of which
one party has a right to performance and the other
party on the other side has a duty to render that
performance.
 REQUIREMENTS OF A CONTRACT
• We know that a contract is an agreement which is
enforceable by law and it is enforceable only when
all the conditions of enforceability are fulfilled.
• In order to become a contract, an agreement must
have the following essential elements
I. Offer and acceptance
II. Consideration
III. Intention to be legally bound
IV. certainty
 OFFER
• An offer is a statement by one party of
willingness to enter into a contract on stated
terms, provided that these terms are in turn
accepted by the party or parties to whom the
offer is addressed.
• There is no general requirement that the offer
be made in a particular form, it may be made
orally, in writing or by conduct.
 REQUIREMENTS FOR AN OFFER.
1. It must be definite and complete.
• The offer must contain enough information to
enable the person to whom it is addressed to
get a clear picture of what the offerer has in
mind.
• The offer must be certain so that the offeree is
able to either accept or reject the offer.
2. The offer must contemplate acceptance and
the resultant obligation
• The offer must be a firm offer
• During pre-contractual negotiations there are
several statements that may be made.
• These statements appear to be offers but are
not considered as offers. These statements may
take the form of;
a) Invitation to treat or do business
b) A supply of or request of information
c) A declaration of intention
 A. INVITATION TO TREAT
• An offer is a final step before acceptance of
the offer.
• An invitation to treat is simply an expression
of willingness to enter into negotiations which
it is hoped will lead to the conclusion of a
contract at a later date.
• The distinction between the two is primarily
said to be one of intention.
 EXAMPLES OF INVITATIONS TO TREAT

A. DISPLAY OF GOODS IN A SHOP

• If goods are displayed in a self service shop or
in a shop window, the display amounts to an
invitation to treat rather than an offer.
• The position is the same with catalogues.
• In Pharmaceutical Society of Great Britain v
Boots Cash Chemists (1953) 1 QB 401
 B. ADVERTISEMENT FOR SALE
• The general rule is that a newspaper
advertisement is an invitation to treat rather than
an offer.
• In Patridge v Crittenden (1968) 1 WLR 1204, Lord
Parker CJ stated that there was business sense in
treating such advertisements as invitations to
treat because if they were treated as offers, the
advertiser might find himself contractually obliged
to sell more goods than he in fact owned.
• In Carlill v Carbolic Smoke Ball (1893) 1 QB
256, on the other hand, the claimant was
entitled to recover the £100 because the
advertisement was held to be an offer and not
an invitation to treat.
 C. TENDERS
• The general rule is that where a person invites
tenders for a particular project, the invitation to
tender is simply an invitation to treat.
• The offer is made by the person who submits the
tender and the acceptance is made when the person
inviting the tenders accepts one of them.
• However in appropriate cases, a court may hold that
the invitation to tender was in fact an offer.
• See the case of Black pool and Fylde Aero Club Ltd v
Black pool Bc (1990) 1 WLR 1195.
 D. AUCTION SALES
• The general rule is that an auctioneer, by
inviting bids to be made, the auctioneer
makes an invitation to treat. The offer is made
by the bidder which in turn is accepted when
the auctioneer strikes the table with his
hammer.
 B. SUPPLY OF OR REQUEST FOR
INFORMATION
• This does not necessarily amount to an offer because
much depends on the interpretation given to the words
used.
• Harvey v Facey (1893) Ac 552, the judicial committee of
the privy council held that Harvey’s first question had
only been a request for information. Facey’s statement
had only been a statement about the lowest price that
he would accept should he decide to sell. It was not an
offer of sell and no legally binding contract has come
into existence.
• See Bigg v Boyd Gibbins (1971) 2 All ER 183
 3. DECLARATION OF INTENTION
• Declaration of intention such as a newspaper
advertisement in which it mentions that an
auction will be held does not amount to an
offer.
• In Harris v Nickerson (1872) LR 8 QB, the
court held that the auction was merely a
statement of intention to hold the auction not
an offer that was capable of acceptance by the
person attending it
 3. THE OFFER MUST COME TO THE
KNOWLEDGE OF THE OFFEREE
• An offer cannot be accepted unless it comes to the
notice of the person to whom it is addressed.
• The essence of this requirement is that the offer
must be communicated by the offeror to the
offeree.
• When an offer is sent by post it is made when the
letter is received by the offeree. The same applies
with E-mails, messages etc.
• The principle is usually stated as “No one can accept
an offer of which they are not aware of.”
 TERMINATION OF THE OFFER
• The general rule is that once an offer is made, it
remains capable of being accepted until it is
terminated.
• There are 5 principal methods by which an offer may
be terminated, namely
1. Revocation
2. Lapse of time
3. Acceptance and rejection
4. Failure of a condition
5. death
 REVOCATION
• An offer can be withdrawn by the offeror at
anytime before it has been accepted.
• However to withdraw an offer, the notice of
the withdrawal must actually be brought to
the attention of the offeree and until and
unless it is communicated and received by the
offeree, it is of no force and effect.
• See the case of Stevenson v Mc Clean (1880)
5 QBD 346
• There is no requirement that the offeror himself
must be the one to bring the withdrawal to the
notice of the offeree.
• See Dickinson v Dodds (1876) 2 Ch D 463
• However where performance of the contract has
began by the offeree, it is too late for the offeror to
revoke the contract.
• See Daulis Ltd v Four Millbank Nominee Ltd (1978)
2 All ER 557 and Errington v Errington (1952) 1 KB
290.
 LAPSE OF TIME
• An offer which is expressly stated to last only
for a specific period of time cannot be
accepted after that date.
• An offer which specifies no time limit is
deemed to last for a reasonable period of
time.
• See Ramsgate Victoria Hotel v Montefiore
(1866) LR 1.
 ACCEPTANCE AND REJECTION
• Once an offer has been accepted by the
offeree, a binding contract is formed by both
parties and the offer ends.
• The offer may also be terminated if the
offeree rejects it. For example if one says, “I
am offering my car for sale at K 50,000” the
offer is effectively terminated when the other
party says “No Thanks.”
 FAILURE OF A CONDITION
• An offer may be made subject to conditions
which may be expressly stated or implied by
the circumstances failure to satisfy this
condition will mean that the offer is incapable
of being accepted.
• See Financings Ltd v Stimson [1962] 3 All ER
386
 DEATH
• An offer is terminated once the offeree is
made aware of the offeror’s death.
• However, as the case of Bradbury v Morgan
(1862) 1 H & C 249 illustrates instances where
the offeree is unaware of the offeror’s death
and there is no personal element involved,
then the offer is still susceptible to
acceptance.