Contract Formation: Cases of Offer & Acceptance

[hotlip]

Canadian Dyers Ass. Ltd. v. Burton
(1920) 47 O.L.R. 259 (H.C.)

I. Facts
Exchange of correspondence between parties re: the sale of a house over a year and a half. Oct. 21 letter states "the last price I gave you is the lowest I am prepared to accept. ... exceptionally low and if it were to any other party I would ask more". This was treated as an Offer and Accepted, a draft deed was prepared, when the cheque was returned and said that it was not ac contract.

II. Issue
Is there a contract?
Was there an offer and acceptance?
Was the Oct. 21, 1919 statement an Offer?
Was the Oct. 23, 1919 acceptance?

III. Holding
The letter was definitely and Offer, therefore an offer and acceptance so there was a contract. Furthermore, if there had not been a contract it should have been claimed immediately, not a deed drafted, etc. and then change his mind.

IV. Reasoning
Banic Doctrine
Mere quotation of price is not an offer
Intention - "reasonable persons test"




(2) Offers or Invitations to Treat4Offers or Invitations to Treat

* if the proposed offer is inconclusive or has many outstanding issues to be considered -- not likely an Offer

Carlill v. Carbolic Smoke Ball Co.
[1893] 1 Q.B. 256 (C.A.)

I. Facts
An advertisement was placed in a newspaper offering the sale of "carbolic smoke balls" that will prevent illness. Within the ad was the guarantee that if the user used the smoke ball as directed, the purchaser would not catch influenza while using the smoke ball. Plaintiff did catch the flu, while using the smoke ball, and wanted the 100 pound award. Defendant placed ad and Plaintiff relied on the advertisement, bought the smoke ball, used as directed and contracted influenza.

History: lower court ruled that the Plaintiff was to receive award

II. Issue
Is there a contract?
Was there an offer and acceptance?

Arguments:
1. Vagueness - time limit; terms; people offered to
2. No opportunity to monitor
3. "puff"
4. Open to public (world)
5. No notice of acceptance
6. No consideration
Also argued: (a) Wagering contract (illegal); (b) Insurance contract

III. Holding
Defendant / Appellants appeal was dismissed. Met the requirements of and comprised of a contract.

IV. Reasoning
Ordinary Person Test -- interpreted as being protected during the time of the use of the ball. Reasonable terms, vagueness of to whom the offer extends.
If you make extravagant offers you are responsible.
If this is simply a sales pitch then why place 1000 pounds in the bank.
You can make an offer to world if you wish to, there is nothing to stop making contracts with many parties.
In some cases the Offeror may dispense with notice, or that notice may be in a different form. Consideration consisted of using the smoke ball (as requested).


Pharmaceutical Society of Great Britain v. Boots Cash Chemists (Southern) Ltd.
[1953] 1 Q.B. 401 (C.A.)

I. Facts
Pharmacists and Poisons Act
Sales of restricted substances under the direct supervision of the registered pharmacist. Customers choose items off a shelf (self-serve) and proceed to cash desk to purchase items. Cash desk is in view of pharmacist, whether the picking up and placing in a basket or going to the cashier is the time of contract acceptance.

II. Issue
When is the Offer, and when is there Acceptance?
Is there a contract?
Was there an offer and acceptance?

III. Holding
Appeal was dismissed.

IV. Reasoning
That the customer makes an Offer when they get up to the cash desk and cashier accepts. The display on open shelves is an invitation to treat by the customer, shop then accepts offer at the cash desk.

R. v. Dawood
[1976] 1 W.W.R. 262 (Alta. S.C. App. Div.)

I. Facts
The Appellant removed the higher price tag off of one piece of he two-piece item. The lower priced piece was also tagged. The Appellant proceeds to the cashier to purchase the item and the clerk rings in and accepts the items at the lower price.

II. Issue
Did the appellant steal the items or obtain by false pretence?
Issue Refined: Did she have possession only or did she have title?

III. Holding
Allowed the appeal, quash conviction, fine will be returned.

IV. Reasoning
It was a voidable contract as having been induced by fraud -- but not theft. Court was saying that the Appellant was charged with the wrong offence. Obtained by deceit.
Dissent by Clement

R. v. Milne SCC "fixing" Dawood. The distinction between void and voidable contracts is valid in contract and property law but not in criminal law.




(3) Auctions and Tenders4Auctions and Tenders

(P) R. v. Ron Engineering (D)
Page 23 (1981), 119 D.L.R. (3d) 267 (S.C.C.)

I. Facts
Contractor submitted tender to build a project. Bid accepted, then contractor determined that a mistake had been made in the tender and wished to withdraw their tender.

II. Issues
Whether, under these circumstances, the contractor would be entitled to withdraw its tender and recover its deposit.

III. Holding & Reasoning
No question that when one review the terms and conditions under which the tender was made that a contract arose upon the submission of a tender between the contractor and the owner. Initial contract is Contract A, construction contract which arises on acceptance of the tender is Contract B. Consideration of terms of contract A. Significant of the bid in law is that it at once becomes irrevocable if filed in conformity with the terms and conditions under which the call for tenders was made and if such terms so provide. Parties agreed that the form and procedure of tender submitted complied with terms and conditions of tender call ... Contract A came into being.
The principal term of contract A is the irrevocability of the bid and the corollary term is the obligation in both parties to enter into a contract ("B") upon the acceptance of the tender. The deposit was required to ensure performance by contractor (tenderer) of its obligations under Contract A. Contractors claim for the return of the tender deposit is dismissed, appeal allowed.
Unilateral Contract is a contract which results from an act made in response to an offer.

(A) R. v. Canamerican Auto Lease and Rental Ltd. (R)
Page 25 (1987), 37 D.L.R. (4th) 591 (Fed. C.A.)

I. Facts
Transport Canada invited tenders for rental counters at airports. ... Tender designed to offer advantage to Canadian owned companies to bid on domestic rental counters and the ability to bid on open counters available to all parties. Canamerican sought damages in the amount which it had in its overinflated tender for the bidding in the "open" category.

II. Issues
Whether there was a breach of contract?

III. Holding & Reasoning - Appeal dismissed.

Trial judge found that the nature of the tender was an offer to enter into a preliminary contract. Proceeded to find a breach of contract A by the award procedure clause of the tender specification and answers provided by Transport Canada officials. The award of a counter "will be made on the basis of the highest offer made by that tenderer in any group".
(A) Saint John Tug Boat Co. v. Irving Refinery Ltd. (R)
Page 59 [1964] S.C.R. 614

I. Facts(P) Williams v. Carwardine (D)
Page 36 (1833), 110 E.R. 590 (K.B.)

I. Facts
Advertisement for a reward for information leading to the murderer of Carwardine (except the party who actually committed the offence). Mrs. Williams made a voluntary statement, containing information that led to conviction of Mr. Williams. Carwardine argued that if the plaintiff was not induced to give evidence by the reward, that the law would not imply a contract for the defendant to pay the reward. Plaintiff would have been aware of the offer for reward as it was advertised all over town.

II. Issues
1. Whether there was a contract
(a) Whether she was induced to give the information by the offer of the promised reward (jury considered during murder trial)

III. Holding & Reasoning
The trial judge found that the plaintiff having given the information which led to the conviction of the murdered has performed the condition to be entitled to the reward - (a) Jury found that she was not induced by the offer of the reward.
Court found that the "advertisement amounts to a general promise, to give a sum of money to any person who shall give information which might lead to the discovery of the offender. The plaintiff gave that information. There was a contract with any person who performed the condition mentioned in the advertisement (cannot go into plaintiff's motives ... rule of inducement was refused).

(A) R. v. Clarke (R)
Page 37 (1927), 40 C.L.R. 227 (Aus. H.C.)

I. Facts
Clarke gave evidence of great value tot he Crown for the prosecution of two parties (without the evidence there would have been no case). Crown refuses to pay reward.
Crown promised that "such information as shall lead to the arrest and conviction of the person or persons who committed the murders". Information provided by Clarke only convicted the persons gu
II. Issues
(1) Was there a contract between Clarke and the Crown?
(a) If the conditions of the offer have not been fulfilled by Clarke, it becomes necessary to decide if Clarke established the contract.


III. Holding & Reasoning
(1) There was no contract. Clarke's statement show clearly that he did not intend to accept the offer of the Crown. Clarke did not act on the faith of, in reliance upon, the reward proclamation. (a) "shall lead" - the information did not in fact lead to the convictions for two murders, so there was no contract (conditions were not fulfilled). Appeal allowed.
Most cases turn on the communication of assent from the offeree to the offeror, communication is necessary. An offer does not bind the person who makes it until it has been accepted, and its acceptance has been communicated. Distinguishment of Gibbons v. Proctor -- A man can accept an contract before he know there is an offer -- this decision must be wrong, so it ought not be followed.
if you know of an Offer, perform an act indicating Acceptance is not necessarily Acceptance of the Offer
fairly restrictive measure of performance

Carlill v. Carbolic Smoke Ball Co., supra.

(A) Blair v. Western Benefit Association (R)
[1972] 4 W.W.R. 284 (B.C.C.A.)

I. Facts
A stenographer transcribes a board of directors resolutions, within those resolutions is a statement that she will be given 2 years salary at retirement. The Company did not tell her directly, she only knew by having transcribed the resolutions. When she retired the company would not pay her the retirement pay of $2000.

History: lower court ruled that the Plaintiff was not entitled to the retirement pay

II. Issue
Is there a contract?
Was there an offer and acceptance?
Arguments:
1. No Offer
2. Offer not communicated
3. No Acceptance
4. No Consideration

III. Holding & Reasoning
Appeal dismissed. #1 and #3 are the strongest arguments for Respondent. No valid consideration, offer was not communicated so it could not be accepted.
"cannot create a binding obligation without communication or offer to make it such ... [use of technical service to transcribe does not show such intention] ... nothing to show she relied on or retired by virtue of the resolution .. can find no evidence of promise or representation of fact to Appellant which she was expected to act or upon which she did act ... was not intended as an offer and the communication of the existence of that resolution by way of dictating it to the claimant in her capacity as a stenographer was no more the making of an offer than was the publication of the offer in [prior cases]"




3. Acceptance3Acceptance

(1) By Words or Conduct4By Words or Conduct
October 7, 1997
Respondent utilized Appellant's tug boats (only such boats available in harbour) that had to be available to guide incoming tankers into the harbour. Exchange of letters for use of tugboats. No written acceptance of this offer but services used by Respondent and paid for the tugboats for a period of time and then ceased payments.

II. Issues
1) Whether or not the respondent's course of conduct during the months in question constituted a continuing acceptance of the offers so as to give rise to a binding contract to pay fr the "stand-by" services of the appellant.
2) Whether an agreement is to be implied from the respondent's acquiescence in the tug's services being supplied for its benefit during the period for which the claim is now made.

III. Holding & Reasoning
There was no written acceptance of March offer, but it is not disputed that the Respondent made verbal arrangements for the rental of the tugs. No difference in use by the Respondent of the Appellant's tugboats after July, 1961 -- nor did respondent indicate any change in the arrangement's for the tugs employment or the charges being made for its services. Respondent denied liability for all charges after July 1961 (invoices from July '61 until Feb. '62).
1) Test of contract is objective -- no reasonable man would suppose that B meant to do the work for nothing, A will be liable to pay for it. The doing of the work is the offer; the permission to do it, or the acquiescence in its being done, constitutes the acceptance. Silence may be deceptive -- person receiving beneficial services may have to speak in order to escape the inference of a promise to pay for them.
2) Respondent was accepting the continuing services on the terms proposed in the March letters and the appellant is entitled to recover the sums charged in invoices up to and including Feb. 1962 as money due pursuant to a contract which was concluded by the respondent's own acquiesence.
at times the Courts will consider a compromise
if A knows what B is proposing and does nothing about it (eg. lets B do the work) ==> acceptance -- can be silence
- depends of the facts, circumstances (eg. first time may not be acceptance

Reasonable Observer Test




(2) Acceptance, Counter-Offer and Request for Information4Acceptance, Counter-Offer and Request for Information

(P) Livingstone v. Evans (D)
Page 42 [1925] 4 D.L.R. 769 (Alta. S.C.)

I. Facts
Sale of land, offer, counter-offer, counter-offer rejected, original offer accepted.

II. Issues
Does a counter offer consist of a rejection of original offer or not?

III. Holding & Reasoning
When an offer has been rejected it is ended and cannot be accepted without the consent of the original offeror. Consideration of renewal of offer or a request to modify the original terms. Held that Evans was standing by original offer and therefore offer was still open to acceptance. Found that there was a binding contract for the sale of the land to the Plaintiff who is then entitled to specific performance.

Today counter-offer = rejection (Intention is vary key to the contract)
New Zealand shipping at the beginning of text


(P) Butler Machine Tool Co. v. Ex-Cell-O Corp. (D)
Page 44 [1979] 1 All E.R. 965 (C.A.)

I. Facts
A machine tool was sold according to the buyer's order form (signed and returned by sellar). When sellers delivered machine they claimed to be entitled to additional payment according to the price variation clause their original offer. Buyers felt that there counter-offer with a fixed price was the contract agreed upon.

II. Issues
Whether the original offer with a price variation clause was the contract or whether the buyer's counter-offer without the price variation clause was the contract.

III. Holding & Reasoning
Found their had been an offer, a rejection of the offer and a counter-offer. The counter-offer kills the original offer. Need to look at all documents and the conduct of the parties whether material agreement has been reached even though there may be a variance between forms and conditions. When there is a "battle of forms" there is a contract as soon as the last of the forms is sent and received without objection being taken to it; can be cases where the first "blow" is the battle winner -- unless the buyer draws specific attention to the differences. Terms and conditions of both parties are to be construed together. Documents have to be considered as a whole. In this case felt buyers' terms were clearly without the price variation clause and that the contract was on those terms. Appeal allowed and judgment entered for buyers.

you can not enforce a contract on another party unless the person is subject to terms or obligations of contract, you cannot force another condition or term into the contract after signing or not disclose a term of the contract
first, last, harmoniously reconciled, imply reasonable terms

October 9, 1997
1. last shot
2. first shot
3. harmonious reconciliation
4. reasonable implications
5. Ignore boiler plate clause

(P) Felthouse v. Bindley (D)
(1862), 11 C.B. (N.S.) 869, 142 E.R. 1037 (Ex Ch.)

I. Facts
An auction house sold a horse that an individual had made an offer to purchase. The owner sent a note after it was sold advising the individual that "that horse (meaning the one I sold to you) is sold." => dispensing with notice of acceptance ?


II. Issue
Conversion
What is the effect of the letter between uncle & nephew?

III. Holding & Reasoning
Damages held against the auctioneer (Bindley) at the original trial. Appeal is an Action in Conversion. 1. acceptance; 2. memo; either no acceptance prior to Feb.27 or there was acceptance but the contract is not enforceable. Contract couldn't be enforceable against a third party (the purchaser of the horse).



(4) Unilateral and Bilateral Contracts4Unilateral and Bilateral Contracts

Unilateral Contracts ----------------------------------->
* Offer but no promise by the Offeree
* lack of mutual obligations leads to various issues

Bi-lateral Contracts
------------------------------------->
Promise (the consideration)
<----------------------------------

Carlill v. Carbolic Smoke Ball Co., supra.

Williams v. Carwardine, supra.

Dawson v. Helicopter Exploration Co. (R)
Page 49 [1955] 5 D.L.R. 404 (S.C.C.)

I. Facts
Dawson staked and claimed a mineral deposit, respondent interested in exploiting property. Respondent backed out by saying that it was unfavourable and unwarranted to examine property. Respondent utilized information obtained from Dawson during negotiations and later began development of claims.

II. Issue
1) Whether acceptance was by promise or by performance of an act
2) Whether silence constitutes abandonment

III. Holding & Reasoning
- a reward offered for act to be done -- instinct with obligation
Tendency of courts to treat offers as calling for bilateral rather than unilateral action when the language can be fairly construed, in order that the transaction shall have such "business efficacy as both parties much have intended that at all events it should have. In doing what it did, Helicopter violated its engagement and ended the contract. Allowed the appeal with costs for Dawson.

Discussion that Dawson's silence may have constituted abandonment of the contract, Estey J. found that no authority was cited to show that silence is to constitute abandonment. Silence may be evidence of repudiation, its weight is considered in context of circumstances and in this case, Dawson's silence combined with the steps he took from returning from active duty does not support the conclusion that he intended to abandon his rights under the contract. The contract remained in force and binding upon both parties .... constituted a breach of its contract.




4. Communication and Acceptance3Communication and Acceptance

Cannot revoke an Offer that has been accepted, can revoke an Offer that has not been accepted. Once the contract is formed, neither party can escape from that contract without the other parties consent. Either the contract will be performed (exchange of consideration for value) or the contract will be breached (one party fails to meet requirement of contract) or the parties can agree to alter or terminate their contract.

(1) Necessary to Form Contract3Necessary to Form Contract
cannot force someone else into a Contract

(2) Waiver of Requirement3Waiver of Requirement

Carlill v. Carbolic Smoke Ball Co., supra.

(3) Mode of Communication3Mode of Communication

(P) Eliason v. Henshaw (D)
Page 63 (1819), 4 Wheat, 225

I. Facts
Action for damages for non-performance of an agreement for the purchase of flour at a stipulated price. Acceptance of offer was down by post rather than by return of wagon as the original offer by way of letter had requested.

II. Issue
1. Was there acceptance and a contract when such acceptance is returned in a manner inconsistent with Offeror's request?

III. Holding & Reasoning
An offer of a bargain by one person to another, imposes no obligation on the former, until it is accepted by the latter, according to the terms in which the offer was made. Any departure from those terms, invalidates the offer, unless the change in terms is agreed to by the offeror.

The Plaintiffs did not comply with the terms of the offer and the defendants were not bound by the acceptance. No conflict concluded between these parties.

Carmichael v. Bank of Montreal
Page 66 (1972), 25 D.L.R. (3d) 570 (Man. Q.B.)

I. Facts
The Plaintiff seeks specific performance of an offer to purchase a house or payment of damages.
Tilley was Agent for Carmichael with full authority, oral communication was sufficient. Acceptance to be communicated to Bank of Montreal by 6 pm, manager had left for day, message received by manager at either 5:59 or 6:01. Message also left at Cuthbert's home at 6:15 is sufficient.

II. Issue
Whether, acceptance of the offer was complete prior to expiration.

III. Holding & Reasoning
offerors must co-operate to accept offer
To complete the chain of binding contract there must be the extension of an offer, its acceptance and communication of that acceptance to the offeror, in this case the vendor. Court found there was effective communication of plaintiff's acceptance of defendant's counter-offer = binding offer and acceptance. Verbal communication of the acceptance of counter-offer to a responsible person in charge at the defendant's bank was sufficient performance of offer. Also delivery of written acceptance to residence was sufficient compliance with the terms of the counter-offer. He who seeks equity must do equity.

*** Carmichael v. Bank of Montreal is not particularly reliable for other cases, fallible, be very careful in trying to use in other cases





(4) Time of Acceptance -- Postal Rules3Time of Acceptance -- Postal Rules
(P) Holwell Securities v. Hughes (D)
Page 79 [1974] 1 All E.R. 161 (C.A.)

I. Facts
The Plaintiffs were attempting to purchase a building. The defendant did not receive the letter confirm‎ing acceptance. Copy of the letter went to the Defendant's solicitor and he was telephoned to be told the letter was on its way. Defendant knew of the letter. Option clause stated that the "notice in writing" within six months would be acceptance.

II. Issue
1. Does posting equal an exercise of the option?
2. Post Box rule apply in all cases?
3. Does it make any difference that the defendant knew of the letter?

III. Holding & Reasoning - Appeal dismissed
The Offeror can stipulate for reply in a certain manner and the grantee must comply. Post box rule does not apply if the express terms of the offer specify another method, nor does it apply if the application of the post box rule would produce manifest inconvenience or absurdity, which illustrates a wider principle:
"the rule does not apply if, having regard to all the circumstances, including the nature of the subject-matter under consideration, the negotiating parties cannot have intended that there should be a binding agreement until the party accepting an offer or exercising an option had in fact communicated the acceptance or exercise to the other."
* Typically delivery is Notice in writing to the proper address will be normally taken as an effective notice of acceptance

Consensus Ad Idem: two minds agree to the context

(A) Brinkibon Ltd. v. Stahag Stahl (R)
Page 71 [1982] 1 All E.R. 293 (H.L.)

I. Facts
Breach for an alleged contract for the supply of steel. Contract was formed by a number of telephone conversations and telexes between London and Vienna. Court to consider whether the English Courts to have jurisdiction for reciprocal enforcement of the contract.

II. Issue
Where was the contract formed and where did the acceptance occur?
1. Whether the contract was "made within jurisdiction"? [inter - outer jurisdiction]
2. Does the post box rule apply?

III. Holding & Reasoning
No universal rule will cover all cases, must be resolved in reference to the intentions of parties, business practice and consideration where the risks should lie.
The general rule {that a contract is formed when acceptance of an offer is communicated by the offeree to the offeror -- the place where it is communicated to offeror} and not the postal rule {where the acceptance is at the post office when sent} should apply. An acceptance by telex is effective on receipt.
Instantaneous communication - eg. telephone, face to face
- only effective when it is actually heard
Non-instantaneous communication - eg. letter by post
Communication was received in Vienna




5. Termination of Offer3Termination of Offer
May occur in conditions of:
lapse of time
rejection by the Offeree (includes counter-offer)
death of either party
revoked by offeree

(1) Rejection or Counter-Offer4Rejection or Counter-Offer

(2) Revocation4Revocation

when the property has been sold unconditionally and the knowledge of that sale makes it to the offeree (not merely a rumour)
imposing on the offeree a revocation that has not been specifically made

(P) Dickinson v. Dodds (D)
Page 84 (1876), 2 Ch. D. 463 (C.A.)

I. Facts
June 10 offer - June 12 at 9:00 am; June 11; Plaintiff accepts

II. Issue
1. Was there acceptance prior to revocation of offer?
2. Does the sale of property to someone else revoke the offer to the original offeree?
3. What conduct revokes an offer?

III. Holding & Reasoning
If an offer has been made for the sale of property, and the offer is accepted, the person who has made the offer enters into a binding agreement to sell the property to somebody else, and the person to whom the offer was first made receives notice in some way that the property has been sold to another person, can he after that make a binding contract by the acceptance of the offer - no. No contract
It appears that the sale of the property to someone else when the offeree is made aware of the sale is effective revocation of the original offer.




(3) Options4Options
Tywood Industries Ltd. v. St. Anne-Nackawic Pulp & Paper Co. Ltd.

Page 46 (1979), 100 D.L.R. (3d) 374 (Ont. H.C.)

I. Facts
A purchase order was sent from the Defendant which contained terms and conditions that had not been in the original contracts. Part of the terms of the purchase order contained an Arbitration Clause that the Plaintiff did not want to participate in. The defendant did not draw any particular attention to the new term or condition. The Plaintiff had never returned the purchase order to the defendant and the defendant never complained.

II. Issue
Is the term contained in the purchase order a binding term of the contract?

III. Holding & Reasoning
In favour of the Plaintiff - Defendant's application for stay dismissed, "neither party considered any terms other than those found on the face of the documents (ie. specs. and price) important".




(3) Silence as Acceptance4Silence as Acceptance

Offer --> Promise --> } No contract
<------- <-- Promise }
(P) Errington v. Errington and Woods (D)
Page 87 [1952] 1 K.B. 290, [1952] 1 All E.R. 149 (C.A.)

I. Facts
Father provided down payment for a home, if daughter and husband made the mortgage payments then the father would transfer the house into their names. The father's promise was a unilateral contract -- a promise of the house in return for their act of paying the instalments.

II. Issues
Whether the estate can remove them from the house; whether contract can still be revoked?

III. Holding & Reasoning
Court found that Father expressly promised the couple that the property should belong to them as soon as the mortgage was paid, and impliedly, promised that so long as they paid the instalments to the building society they should be allowed to remain in possession. The couple entered into performance of the act. They are in a position analogous to purchaser.
Appeal dismissed, no order of possession to be made. Once an offeree has embarked on performance of the contract, offeror may not be able to revoke the offer.

(P) Daulia v. Four Millbank Nominees (D)
Page 88 [1978] Ch. 231, [1978] 2 All E.R. 557 (C.A.)

I. Facts
Defendants promised to sell properties to Plaintiff if plaintiff provided a deposit by a bankers draft prior to 10 am the next day. They did so and the defendants would not sell the property the next day.

II. Issues
Was there a concluded unilateral contract by the defendants enter into a contract for sale on the agreed terms?

III. Holding & Reasoning
There was a contract -- the Plaintiffs fully performed and satisfied the condition when they presented themselves at the time and place. Actual exchange never took place, which is not a condition of the contract (used to enable not bind the contract). Once the offeree has embarked on performance it is too late for the offeror to revoke the offer.
[Though this is an unenforceable contract due to being for the disposition of an interest in land and a lack of sufficient writing or acts of part performance]




(5) Lapse of Time4Lapse of Time

offer expires of its own force by a date included or after a reasonable period of time

(P) Manchester Diocesan Council of Eduction v.
Commercial and General Investments Ltd. (D)
Page 94 [1970] 1 W.L.R. 241, [1969] 3 All E.R. 1593 (Ch. D.)

I. Facts
Property for sale by Tender -- Sept. 15 - letter accepting sent to wrong address (surveyors not solicitors); Dec. 23 - Plaintiff's solicitors write to Defendant's solicitors; Jan. 5; Jan. 6; Jan 7. - withdrawal of offer (revoke); Jan. 7 - effective acceptance which takes effect when posted (formal notice)

II. Issues
Whether the offer was accepted properly and when it was accepted?
Whether the acceptance of the offer was not within a reasonable period of time?

III. Holding & Reasoning

If an offeror stipulates by the terms of his offer that it may, or that it shall be accepted in a particular manner a contract results as soon as the offeree does the stipulated act, whether it has come to the notice of the offeror or not. The offeror conditionally waives either expressly or by implication the normal requirement that acceptance must be communicated to the offeror to conclude a contract. If the party communicates his acceptance in some other way, the offeror may be conduct or otherwise waive his right to insist on the prescribed method of acceptance.
Where an offer is made in terms which fix no time limit for acceptance, the offer must be accepted within a reasonable time to make a contract. If the conduct of the offeree, that is, that having failed to accept the offer within a reasonable time he has manifested an intention to refuse it.
It does not seem to me that either party is in greater need of protection by the law in this respect than the other. Until his offer has been accepted, it is open to the offeror at any time to withdraw it or to put a limit on the time for acceptance. The Offer was still open January 7 and the plaintiff's letter of that date was effectual to bind the defendant company contractually -- order for specific performance.


(P) Barrick v. Clark (D)
Page 90 [1951] S.C.R. 177, [1950] 4 D.L.R. 529

I. Facts
Sale of 3 quarter sections of land. Oct. 30 - Clark Offers to purchase land; Nov. 15 - counter offer by Barrick to sell land; Nov. 20 - wife writes letter stating husband is hunting; Dec. 10 - Clark sends letter to accept offer and enclose cheque; Dec. 11 - Clark wires Barrick confirm‎ing acceptance; Dec. 12 - Barrick writes letter to Clark telling him that land has been sold

II. Issues
Whether acceptance was made within a reasonable period of time?

III. Holding & Reasoning
What constitutes a reasonable period of time depends on the nature, character, normal and usual course of business in negation as leading to a sale, as well as the circumstances of the offer including the conduct of parties in the course of negotiations (surrounding circumstances). Farm lands are not subject to frequent or sudden changes or fluctuations in price and, therefore, in the ordinary course of business a reasonable time for the acceptance of an offer would be longer than that with respect to such commodities. Clark did not accept Barrick's offer within a reasonable period of time. Appeal allowed.

S Assuming Clark didn't hear rumours until Dec. 11 -- is it simply rumours and heresay or is this a clear statement from a reliable source. If information is reliable, such that using Dickinson v. Dodds, the issue remains whether the Dec. 10 letter falls within post-box acceptance rule (most likely that the Dec. 10 letter would be acceptance). Then need to consider whether the parties anticipate correspondence by letter (authorize by communication by letter) -- could go either way but doesn't appear that Court would have accepted post-box acceptance.




(6) Conditional Offer4Conditional Offer