Mobil Oil Australia v Welcome International case note PDF

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CASE: – Mobil Oil Australia v Welcome International ‘Unilateral contracts’ or ‘offers to the whole world’ Precedent: In a unilateral agreement the act of acceptance is also the consideration and act of performance. Unilateral offer, unless there was an ancillary contract entered into that guaranteed that the main contract would not be withdrawn, the contract may be revoked at any time. Facts: Mobil represented to dealers that any dealer who performed at a set level for six years would be given a franchise for a further nine years at no cost. Mobil subsequently discontinued the scheme and a number of dealers alleged (amongst other things) breach of contract Issue: whether or not, a contract was formed in this case, due to the offer, acceptance and consideration not being established. Further, whether or not there was a presence of unilateral contract and whether the same could be revoked. Lastly, the issue was raised regarding whether or not, the concept of estoppel could be used in this case. Judgement: In this case Mobil’s revocation of its scheme made it impossible for the dealers to complete the act of acceptance. The trial judge held that once an offer was made, requiring performance as the act of acceptance, the offeror could not revoke the offer once the offeree has embarked upon acceptance Offer: Mobil has not made an offer to the franchisees – the uncertain and vague terms of the reward meant that there was no certainty and the scheme was merely in a developmental stage. Unilateral contracts and revocation: There is no universal rule with regards to revocation of a unilateral contract, must be judged case by case. Franchisees did not suffer a detriment by improving their own performance and therefore no real consideration. “An offer made in return for performance of an act is, like any other offer, revocable at any time. ” Estoppel – Assumption: It is necessary that the defendant has encouraged an assumption that a particular legal relationship or interest would arise. The elements and details of this legal relationship is lacking here – generalised commitment to ‘find a way’ does not encourage an assumption that a legal relationship arising. No element of assumption, no rise for estoppel....