OfferandAcceptance

Last updated: 08-Jul-2015

Adams v Lindsell [1818] EWHC (KB) J59, per Lord Ellenborough:
So here the defendants who have proposed by letter to sell this wool, are not to be
held liable, even though it be now admitted that the answer did not come back in due
course of post. Till the plaintiffs' answer was actually received, there could be no
binding contract between the parties; and before then, the defendants had retracted
their offer, by selling the wool to other persons.
But the Court said, that if that were so, no contract could ever be completed by the
post. For if the defendants were not bound by their offer when accepted by the
plaintiffs till the answer was received, then the plaintiffs ought not to be bound till
after they had received the notification that the defendants had received their answer
and assented to it. And so it might go on ad infinitum. The defendants must be
considered in law as making, during every instant of the time their letter was
travelling, the same identical offer to the plaintiffs; and then the contract is
completed by the

acceptance of it by the latter.

Dickinson v Dodds (1876) 2 Ch D 463, AC per James LJ:

The Plaintiff [Dickinson], being minded not to complete the bargain at that time,
added this memorandumThis offer to be left over until Friday, 9 o'clock a.m., 12th
June, 1874. That shews it was only an offer. There was no consideration given for the
undertaking or

promise, to whatever extent it may be considered binding, to keep the

property unsold until 9 o'clock on Friday morning; but apparently Dickinson was of
opinion, and probably Dodds was of the same opinion, that he (Dodds) was bound by
that

promise, and could not in any way withdraw from it, or retract it, until 9 o'clock

on Friday morning, and this probably explains a good deal of what afterwards took
place. But it is clear settled law, on one of the clearest principles of law, that

promise, being a mere nudum pactum, was not binding, and that at any moment
before a complete acceptance by Dickinson of the offer, Dodds was as free as
this

Dickinson himself. Well, that being the state of things, it is said that the only mode in
which Dodds could assert that freedom was by actually and distinctly saying to
Dickinson, 'Now I withdraw my offer'. It appears to me that there is neither principle
nor authority for the proposition that there must be an express and actual withdrawal
of the offer, or what is called a retraction.
And per Mellish LJ:
It is admitted law that, if a man who makes an offer dies, the offer cannot be
accepted after he is dead, and parting with the property has very much the same
effect as the death of the owner, for it makes the performance of the offer impossible.

I am clearly of opinion that, just as when a man who has made an offer dies before it is
accepted it is impossible that it can then be accepted, so when once the person to
whom the offer was made knows that the property has been sold to someone else, it is
too late for him to accept the offer, and on that ground I am clearly of opinion that
there was no binding contract for the sale of this property by Dodds to Dickinson
Henthorn v Fraser (1892) 2 Ch 27, per Lord Herschell:
I think that a person who has made an offer must be considered as continuously making

knowledge of the person to whom it was made that it is

withdrawn. The grounds upon which it has been held that the acceptance of an
it until he has brought to the

offer is complete when it is posted have, I think, no application to the revocation or

modification of an offer. These can be no more effectual than the offer itself, unless
brought to the mind of the person to whom the offer is made.
Carlill v Carbolic Smoke Ball Company [1893] 1 QB 256, per Bowen LJ:
Now, if that is the law, how are we to find out whether the person who makes the offer
does intimate that notification of acceptance will not be necessary in order to
constitute a binding bargain? In many cases you look to the offer itself. In many cases
you extract from the character of the transaction that notification is not required, and
in the advertisement cases it seems to me to follow as an inference to be drawn from
the transaction itself that a person is not to notify his

acceptance of the offer before

he performs the condition, but that if he performs the condition notification is

dispensed with. It seems to me that from the point of view of

common sense no

other idea could be entertained. If I advertise to the world that my dog is lost, and
that anybody who brings the dog to a particular place will be paid some money, are all
the police or other persons whose business it is to find lost dogs to be expected to sit
down and write me a note saying that they have accepted my proposal? Why, of course,
they at once look after the dog, and as soon as they find the dog they have performed
the condition. The essence of the transaction is that the dog should be found, and it is
not necessary under such circumstances, as it seems to me, that in order to make the
contract binding there should be any notification of acceptance. It follows from the
nature of the thing that the performance of the condition is
sufficient

acceptance without the notification of it, and a person who makes an offer

in an advertisement of that kind makes an offer which must be read by the light of
that

common sense reflection. He does, therefore, in his offer impliedly indicate

that he does not require notification of the acceptance of the offer.

R v Clarke (1927) 40 CLR 227 per Isaacs AC J at p. 235:
An offer of 100 to any person who should swim a hundred yards in the harbour on the
first day of the year, would be met by voluntarily performing the feat with reference to
the offer, but would not in my opinion be satisfied by a person who was accidentally or

maliciously thrown overboard on that date and swam the distance simply to save his
life, without any thought of the offer. The offeror might or might not feel morally
impelled to give the sum in such a case, but would be under no contractual obligation
to do so.
Centrovincial Estates PLC v Merchant Investors Assurance Company Ltd. [1983] Com LR
158. Obiter dictum of Slade LJ:
Where the nature of an offer is to enter into a bilateral contract, the contract becomes
binding when the offeree gives the requested

promise to the promisor in the manner

contemplated by the offer; the mutual promises alone will suffice to conclude the
contract. In our opinion, subject to what is said below relating to consideration, it is
contrary to the well established principles of contract law to suggest that the offeror
under a bilateral contract can withdraw an unambiguous offer, after it has been
accepted in the manner contemplated by the offer, merely because he has made a
mistake which the offeree neither knew nor could reasonably have known at the time
when he accepted it.
Interfoto Picture Library Ltd v Stiletto Visual Programmes Ltd [1989] QB 433, per Lord
Denning MR:
The customer pays his money and gets a ticket. He cannot refuse it. He cannot get his
money back. He may protest to the machine, even swear at it. But it will remain
unmoved. He is committed beyond recall. He was committed at the very moment when
he put his money into the machine. The contract was concluded at that time. It can be
translated into offer and

acceptance in this way: the offer is made when the

proprietor of the machine holds it out as being ready to receive the money. The
acceptance takes place when the customer puts his money into the slot. The terms of
the offer are contained in the notice placed on or near the machinestating what is
offered for the money. The customer is bound by those terms as long as they are
sufficiently brought to his notice beforehand, but not otherwise. He is not bound by
the terms printed on the ticket if they differ from the notice, because the ticket comes
too late. The contract has already been made.
Shogun Finance Ltd v Hudson [2004] 1 AC 919, per Lord Millett (in his dissenting
judgment) at p.949:
[63] It is trite law, , that before a contract can come into existence there must be
offer and

acceptance, and these must correspond. The offer must be addressed to the

offeree, either as an individual or as a member of a class or of the public.

The

acceptance must come from one who is so addressed and must itself be addressed

to the offeror. It is not possible in law for a person to accept an offer made to someone
else; or to intercept an
an

acceptance of someone elses offer and treat it as

acceptance of his own.

[64] This is usually straightforward enough, at least in the absence of fraud.

and per Lord Walker of Gestingthorpe at para 188:
Where there is an alleged contract reached by correspondence, offer and acceptance
must be found, if they are to be found at all, in the terms of the documents.