Contract Law Lecture 5 Acceptance What is Acceptance? · A final and unqualified assent to all the terms of an offer. · The second stage of deciphering whether there has been an agreement. · Requires no particular formula. · Provides intention to be bound by the terms of an offer, which then becomes an agreement. Characteristics of Acceptance . Must be unequivocal, unconditional and it should match the offer (Mirror-image rule). · Must fit with an offer like 2 pieces of a jigsaw puzzle. o Acceptance has to fit offer exactly to be a valid acceptance - see case below. · In a bilateral contract, acceptance must be communicated to the offeror. . Must not introduce new terms. o Hyde v Wrench (1840) 3 Beav 334- Counter-Offer · Defendant offered to sell a farm to Plaintiff for £1,000. . Plaintiff offered to buy the farm for £900. · Defendant rejected that offer. · Plaintiff then wanted to accept the initial offer of £1,000. . Defendant refused to go through with the transaction and Plaintiff sought specific performance. · Held -Plaintiff's offer of £900 was not an acceptance. It was a counter-offer and his final communication was not an acceptance of the original offer but a further offer to buy at £1,000, which the defendant was at liberty to accept or reject. · During negotiations, parties may respond to an offer by suggesting different terms. . Such a response is not valid as an acceptance because it does not match the offer-it will be a counter-offer. · Several offers and counter-offers may be put forward. · A counter-offer is a rejection of a previous offer and thus destroys it, rendering it incapable of subsequent acceptance. . Only the last offer put forward survives and is available for acceptance. Request for Information · In certain situations, it might be difficult to determine whether a communication is a counter-offer or not. · Request for information allows room for inquiry about how the contract will be performed, and thus not a counter-offer . Example, Clare offers to sell her car to Jane. Jane calls her to accept and then inquires as to whether she would like the payment in cash or by cheque.
Lecture 5 Contract Law · Such an inquiry is not a counter-offer because it is not suggesting or introducing new terms but simply clarifying the way the contract will be performed. . Stevenson, Jaques & Co v McLean (1880) 5 QBD 346- o Offeror made an offer to sell some iron to offeree for 40 shillings, but did not indicate a delivery time o Offeree (Acceptor) replied stating: Please wire whether you would accept 40 for delivery over two months, or if not, longest time you would give o Offeree subsequently accepted the offer. o Held: The acceptance was valid. The inquiry sought to clarify the position as to delivery of the iron. It was not a counter-offer. ‘Battle of the Forms' . This situation is one in which it becomes