Contract Law – Paper

The existence of contract law is to prevent any sort of illegal behaviour, injustice and to clarify any confusion or misunderstanding amongst the offerror and the offeree. Everybody in this world is an offeree as we all purchase goods and services to meet our personal needs and if our expectations are not met, there is a problem which is why the contract is created for both parties to follow. However, if either of them fails to do so, then they are in breach of contract and the aggrieved party has legal rights that they can try and enforce. A contract is formed when there is an offer or acceptance.

In this assignment I have been given a case to resolve and advise the parties whether they are in breach of contract or not. A contract is a promise or set of promises the law will enforce. The scenario I have been given states that Fred placed an advertisement providing his potential buyers with the information given below. ‘Garage sale of law books. Items include the entire set of Weekly Law Reports from 1970 – 1990 to be sold to the first person who is willing to pay ? 100 for the lot. Sale starts Saturday 11th December at 9am. Address 1, Fairfield Road, Hygate, Telephone Number, Hygate 12345. ’

Hence, Peter sets out early on Saturday 11th December to be the first one in the queue and offers ? 100 to Fred. However, he discovers that Fred has sold the books to Sally who had phoned him to purchase the books as soon as she saw the advertisement. In order for a contract to arise, there must be an offer and acceptance. An offer is a definite promise to be bound provided certain specific terms are accepted. However, there are two types of offer including unilateral contract which is a contract where one party binds itself to perform a stated promise upon performance of the requested act or condition by the promise.

However, the promise gives no commitment to perform the act or condition by the promise and bilateral contract is a promise in exchange for a promise. In this case, Fred’s offer was unilateral contract as only Fred made the promise. Hence, The advertisement is not an invitation to treat as Invitation to treat is an indication the offerror is willing to negotiate but is not prepared to be legally bound whereas in the case of Fred v Peter, Fred is willing to be bound in an agreement with whoever pays him ? 100 for the lot as he has made an offer to a group of people.

An offer is a definite promise to be bound provided certain specific terms are accepted. However, the offer only takes place when it has been communicated to the offeree by the offerror. An offerror is a person who presents something for either acceptance or rejection whereas the offeree is the person who accepts or rejects something being sold by the offerror. In Fred’s case, his offer is valid as he communicated his offer to the world in his advertisement. Once the offer has been made and communication has taken place the contract is merely concluded when acceptance takes place.

According to the mirror image rule acceptance must match the offer. Acceptance is defined as an unconditional assent to all the terms of the offer. Judging by the details given on the advertisement, Fred is in breach of contract as Peter complied with the terms of the advertisement by being the first one on the sale date and offering the stated purchase price. This can be linked with the case of Lefkowitz v Great Minneapolis Surplus Store, (1957) where Great Minneapolis Surplus Store (D) published an advertisement in the following terms: ‘‘Saturday 9. am. sharp: 3 brand new fur coats, worth to $100. First come first served. $1 each.

’ Lefkowitz (P) was the first customer to offer the one dollar price per the terms of the advertisement but the defendant refused to sell the sale items to Lefkowitz and said to him that the offer was intended for women only. However, it was held that the advertisement was an offer Lefkowitz was entitled to performance by the defendant because he abided the terms of the advertisement. However, Fred could argue that he mentioned that the law reports will be sold to the first person who is wiling to pay ? 100 but Fred did not mention the exact method of expressing acceptance of the offer such as postal rule/oral and when to contact him.

The terms ‘sale starts on Saturday 11th December’ explicitly indicates that his offer will take effect on the date given. Hence, he should not have accepted Sally’s acceptance before the mentioned date in the advertisement. If Fred had advertised in the Hygate times of 10th December that the offer to sell the books is now withdrawn but peter had not read the advertisement, then Fred would not have been in breach of contract as it has been held in Byrne v Van Tienhoven and Dickinson v Dodds that revocation can take place anytime before acceptance and the revocation must be communicated.

In Fred’s case, Peter had not yet accepted the offer on 10th of December as he is required to perform an act to communicate his acceptance. Hence, since there wasn’t any communication from Peter until 10th of decmeber, it means there is no acceptance and Fred is not bound by the contract as revocation was communicated to the offeree and was advertised a day before the sale date. Also, revocation of a unilateral offer is not possible once performance has started, This could be linked to the case of Errington v Errington & Woods [1952] 2 KB 290.

However, in Fred v Peter, performance was started after the revocation of offer which means Fred would not have been in breach of contract. In conclusion, I personally think that Fred should have made it clear in his advertisement how he wishes to be contacted about the offer and whether the offer can be accepted before the sale date. Had he mentioned these details, Peter would not have waited until the sale date and would have attempted to phone Fred as Sally did to accept his offer. Reference: Smith and Keenan’s English Law, fifteenth Edition, (2005). Word Count: