· A Contract is an agreement giving rise to obligations enforced or recognised by law. (Treitel) . The courts assess the existence of a contract by looking for an offer and a corresponding acceptance. · In determining whether a contract has been made, the courts apply the principle of objective intention (i.e. would a reasonable person believe an offer/acceptance was being made) (Smith v Hughes) Offer · An offer is an expression of willingness to contract on specified terms, made with the intention that it will become binding as soon as it is accepted by the person to whom it is addressed. (Treitel) . An offer must be capable of being accepted and show offeror's intention to be legally bound (Harvey v Facey / Gibson v Manchester City Council - Defendant council adopted policy of selling council houses to tenants. Claimant applied for details of the price of the house he was renting to which council replied 'the corporation may be prepared to sell the house to you at the purchase price of ... ' ). Held the words 'may be prepared' are fatal i.e. it was not capable of being accepted nor did it show intention to be bound > not an offer · Offer v Invitation to Treat · An invitation to treat is an expression of willingness to negotiate. · Display of goods for sale Goods displayed in a shop window = Invitation to treat. (Fisher v Bell) Goods displayed on a shop shelf = Invitation to treat. The customer makes an offer when they present their selected items at the cash desk. (Pharmaceutical Society v Boots) . Advertisements Advertisement of bilateral offer -> Invitation to treat. (Partridge v Crittenden / Graigner & Sons v Gough) However, an advertisement of a bilateral offer which is 'clear, definite, explicit and leaves nothing open for negotiation' > offer Lefkowitz v Great Minneapolis Surplus Stores - Defendant placed an advert in a newspaper saying 'Saturday 9 A.M. Sharp 3 Brand New Fur Coats Worth to $100.00. First Come First Served $1 Each.' Plaintiff was first to show up but defendant refused to sell to them. Held it was an offer. Advertisement of a reward -> Offer. (Gibbons v Proctor) Advertisement of unilateral offer which is made in clear terms, capable of being accepted and shows intention to be bound -> Offer. (Carlill v Carbolic1 / Bowerman v ABTA) Courts are less willing to find that advertisement of a bilateral offer is an offer. (Chitty, 2012) · Termination of Offer · Lapse of time If offer specified as open for a period of time, once that passes it is invalid. If not specified, the offer is valid for a reasonable amount of time. (Ramsgate v Montefiore - 5 months to long to accept offeror's offer to sell shares) . Rejection by offeree If the offeree's statement seeks to alter the terms of the offer, a counter-offer is made which kills the original offer. (Hyde v Wrench) Where there is a counter-offer,