Contract Law Essay - Grade: 55 PDF

Preview

Summary

Download Contract Law Essay - Grade: 55 PDF

Description

Elements of Law of Contract – Formative Assessment Essay Name: Anunay Chowdhary Tutorial Group Number: Tutorial Time: 12 PM – 1PM Thursdays Word Count: 1168 Particular aspect about which I would like feedback: • Quality of Referencing • Coherence of Argument • Style of Writing ESSAY ANSWER Mr. Gerald has advertised to sell a car in a newspaper. He has detailed the specification of the product he intends to sell. He has also given his personal details in the advertisement to allow a potential buyer to contact him in case of interests. Ms. Harriet, upon being cognizant of the advertisement, contacts Mr. Gerald to covey her intent to buy the car. Ms. Harriet uses mobile text services as a medium of communication to convey her intent. In doing so, she also asks Mr. Gerald to extend the date of payment of the car. Further it is established that Mr. Gerald never receives Ms. Harriet’s communication and he uses his discretion to sell the car to a third party. Upon realizing the same, Ms. Harriet sues Mr. Gerald for a breach of contract. Clearly, the question at hand deals with the formation of a contract. It is pertinent to analyze the elements of offer and agreement, which among others, are core competencies of any contract formation. It is submitted that the advertisement to sell the car is an offer to treat and not an offer per se. It is also submitted that the communication by Ms. Harriet to Mr. Gerald to agree to buy the car in addition to the request of extension of the date of payment does not constitute a valid agreement. The request to extend the date of payment should be treated as a counteroffer which extinguishes the validity of the original offer and renders Mr. Gerald with reservation of right to reject any counter-offer. Mr. Gerald has strong case against the suit brought by Ms. Harriet. Subsequent sections of this essay will look into the problem in further detail. At the outset, it is essential to delineate the underlying principles in the problem question to order to give a comprehensive advice to Mr. Gerald. This section will proceed with stating arguments that will strengthen the case for Mr. Gerald with relevant English legal literature and authorities available followed by the possible argument that can weaken the case for Mr. Gerald. In the said case, it is essential to analyze the formation of the contract. Following section deals in detail to show the lack of formation of a contract between Mr. Gerald and Ms. Harriet. Advertisement is not an offer but an invitation to treat There are various authorities in English law that have established this principle1 with certain exceptions. Lord Ashworth J in Partridge v. Crittenden1 concurring with the views of Lord Parker CJ in Fisher v. Bell2 that an advertisement of good in a newspaper or a periodical is not an offer but an invitation to treat. A mere act of advertising goods in newspaper is an 1 2

Partridge v. Crittenden [1968] 2 All ER 421 Fisher v. Bells [1961] 1 QB 394

opportunity for the prospective buyers to offer to buy the advertised good. The facts of the matter clearly state that the Mr. Gerald’s act of advertisement was a not an offer but an invitation to an offer. Anyone replying to the advertisement to buy the car is merely extending an offer to Mr. Gerald. However, there are certain reservations against the above-mentioned doctrine which have been established in Carlill v. Carbolic Smoke Ball Company Ltd. 3, It was ruled that the advertisement by the defendant was an offer to the world and the defendant is bound by the offer if someone positively fulfills the condition laid down in the advertisement. Lord Bowen LJ noted that the person making an offer can impliedly or expressly intimate a mode of acceptance and the person to whom the offer is made can by the way of an act mentioned in the proposal can constitute an acceptance without notification. Herein it is submitted that the content of Mr. Gerald’s advertisement did not create any condition against the world. Any act of intimation to buy the car cannot be treated as an act of fulfillment of a condition. A counter-offer extinguishes the validity of the original contract This was established in the case of Hyde v Wrench 4. The court held that the plaintiff’s offer of a new price constituted a counter-offer and the obligation to accept the offer was on the defendant. Lord Langdale stated that the plaintiff’s offer of a new price renders him incompetent to revive the original offer. This has to be understood with a closer inspection of the terms stated by anyone in the position to accept the offer. The stated terms might be confused with a mere request for information. As in the case of Stevenson, Jacques & Co. v McLean5, The court held that the plaintiff’s reply was not a rejection of the offer but an inquiry which had no effect on the continuance of the original offer. It is submitted that Mr. Gerald’s advertisement expressly states the date of conclusion of the purchase of the car. Ms. Harriet reply for the alteration of an expressly stated term of the advertisement should be treated as a counter-offer which is a revocation of the original terms of the advertisement. Communication of the acceptance In Cooke v Oxley, it was held by the court that the offeror is not bound by the interest of a single party and can sell goods to anyone before the communication of the acceptance. The fact of the matter clearly states the lack of communication on the part of Ms. Harriet which fails to bound Mr. Gerald to any further negotiations. It is also necessary to invoke the cases of Entores v Miles6 and Brinkibon Ltd v Stahag Stahl und Stahlwarenhandelsgesellschaft mbH 7 in order to understand that the facts of the present cases fail to qualify for the postal rule of acceptance conceived in the case of Adams v Lindsell 8. It was established in the Entores and Brinkibon that the communication of acceptance by any instantaneous mode of communication (Text message in the present case) is necessary. Therefore, the burden of communication of acceptance lies on the offeree (Ms. Harriet in the present case). The above-mentioned analysis covers all the potential areas of contention between Mr. Gerald and Ms. Harriet. It is sufficiently proven that Mr. Gerald’s advertisement to sell his car is not an offer but an invitation to treat. He reserves all the rights regarding the sale of the product. Ms. Harriet’s intimation regarding her intent to buy the car does not constitute a valid 3

Carlill v. Carbolic Smoke Ball Co. [1893] 1 QB 256

4

Hyde v. Wrench [1840] EWHC Ch J90 Stevenson, Jacques & Co. v. McLean [1880] 5 QBD 346 Entores v. Miles Far East Corp. [1955] 2 QB 327 Brinkibon Ltd v. Stahag Stahl und Stahlwarenhandelsgesellschaft mbH [1983] 2 AC 34 Adams v. Lindsell [1818] 1 B & Ald 681.

5 6 7 8

agreement due to number of reasons stated above. It is therefore safe to conclude that there is no valid contract between Mr. Gerald and Ms. Harriet and that Mr. Gerald has a formidable case against Ms. Harriet....