Assignment

Invitation to treat

Submitted to Submitted by

Dr. Girjesh Shukla Akash Bhardwaj

(Associate Professor) (1020181907)

HIMACHAL PRADESH NATIONAL LAW UNIVERSITY

GHANDAL, SHIMLA, P.O. SHAKRAH, SUB-TEHSIL DHAMI
DISTRICT SHIMLA, HIMACHAL PRADESH-171014
Ph. 0177-2779802, 0177-2779803, Fax: 0177-2779802
Website:http://hpnlu.ac.in
 DECLARATION

The work embodied in this Assignment titled “Invitation to Treat” has been done by
me and not submitted elsewhere for the award of any other degree/certificate. All ideas and
references have been duly acknowledged.

Akash Bhardwaj

B.A.LL.B. 2nd Semester

(Batch 2018-19)

(1020181907)

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 ACKNOWLEDGMENT

The accomplishment of this assignment required leadership and assistance from many people
and I am extremely privileged to have got this all along the completion of our assignment
work. I express my thankfulness to my subject teacher for giving me this opportunity to do
work on this topic and learn so much along the way. Ever motivating seniors helped me at
every step of the research. Furthermore, I would like to acknowledge the staff of the
Himachal Pradesh National Law University, who gave me the permission to access to all the
required equipment in completing this project. This assignment could not have been
completed without each one’s help.

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 Content

Introduction…………………………………………………….1

Statement of Problem…………………………………………..1

Research methodology…………………………………………1

Offer or proposal……………………………………………….2

Invitation to treat……………………………………………….3

Case Laws……………………………………………………...4

i. Harvey v. Facey……………………………………4
ii. Pharmaceutical Society of Great Britain v.
Boots cash chemists………………………………..5

Difference between offer and invitation to offer………………6

Bibliography…………………………………………………...7

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List of cases
Name of case Citation Page number
Harvey v. Facey Harvey v Facey (1893)
Pharmaceutical Society of Pharmaceutical Society of
Great Britain v Boots Cash Great Britain v Boots Cash
Chemists Chemists [1953] 1 QB 401
 Invitation to Treat

INTRODUCTION

A contract is formed where there is an offer, an acceptance, consideration and an intention to

be in a legal relationship with the offeree. On the other hand, an invitation to treat is merely
an invitation for customers to submit an offer. While it specifies a readiness to deal, it is
different from an offer in that it lacks an intention to be bound. Similar to an invitation to
bid in the public procurement procedure, invitations to offer (sometimes referred to
as invitations to treat/bargain) often arise in the context of pre-contractual negotiations,
advertisements and shop displays. In some judicial systems , however, advertisements and
displays may be treated as offers which constitute unilateral contracts.

Statement of Problem

My area of research is ‘Invitation to treat’ and in this research work I’ve focused on the
difference between an offer and an invitation to offer or treat.

Research Methodology

This is an armchair research and the material used in mainly secondary data and took help of
books, journal and internet.

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OFFER OR PROPOSAL

Section 2(a) of the Indian Contract Act, 1872 defines the term "Proposal" as when one person
signifies to another his willingness to do or to abstain from doing something with a view to
obtaining the assent of the other to such an act or abstinence, he is said to make a proposal1.
The person making the 'proposal' or 'offer' is called the 'promisor' or 'offeror', the person to
whom the offer is made is called the 'offeree'2.

An offer is an expression of a person showing his readiness to another person whether to do

or not to do something, to obtain his consent on such expression. The acceptance of the offer
by such person will result in a proper contract. An offer must be fixed, certain and absolute in
all respects. It must be communicated to the party to whom it is made. The offer is legally
binding on the parties. There are following types of offer:

 General offer: It is the kind of offer which is made to public at large.

 Specific offer: This is the kind of offer which to made to a specific person.
 Cross offer: When one of the parties made an offer to another without knowing that
that the other party has also made the same offer.
 Counter offer: This is another kind of offer in which the offeree does not accept the
original offer, but after altering the terms and conditions accept it, it is termed as a
counter offer.
 Standing offer: An offer which is made to public at large as well as it remains open
for a particular period for acceptance it is known as standing offer.

Example:

 M tells to N,”I want to sell my car to you at Rs. 30,000, Will you buy it?”
 X says to Y,”I want to purchase your bike for Rs. 20,000, Will you sell it to me?”

1
Section 2(a) Indian Contract Act 1872 pg 2
2
Section 2(c) Indian Contract Act 1872 pg 2
INVITATION TO OFFER

An Invitation to treat is an act before an offer, in which one person persuades another person
to make an offer to him, it is known as invitation to Treat. When properly replied by the other
party, an invitation to treat results in an offer. It is made to the general public with an intent to
receive offers and alter the terms on which the contract is created.

The invitation to treat is made to inform the public at general, the terms and conditions on
which a person is interested in entering into a valid contract with the other party. Though the
former party is not an offeror as he never made an offer instead, he is making people to offer
him. Therefore, this kind of acceptance doesn’t amount to a contract, but is an offer. When
the former party takes the offer made by the other party, it becomes a contract, which is
legally binding on the parties.

Example:

 Menu card of a cafe showing the prices of eatables and drinks.

 Roadways timetable on which the bus timings and fares are shown.
 Government Tender
 Recruitment advertisement inviting application.

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 Case Laws

1. Harvey v Facey (1893)3:-

Harvey sent a Telegram to Facey in which it was written: -

"Are you willing to sell us Bumper Hall Pen? Please tell me lowest cash price-answer
paid;"

To which Facey replied by tele:-

"Lowest price for Bumper Hall Pen is £900."

To this Harvey replied:-

"I am ready to buy Bumper Hall Pen for the sum of 900 pounds as asked by you.
Please send me your title deed in order that we may get early possession."

Held:

The court of Privy Council held that there is no valid contract is made between the
parties. Facey didn’t answer the first question as to whether he would sell it and the
lowest price stated was merely replying to a request for information and not an offer.
There was thus no evidence of an intention that the telegram sent by Facey was to be
an offer.
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3
1893 AC 552
 2. Pharmaceutical Society of Great Britain v Boots Cash Chemists
[1953] 1 QB 4014

Facts

The defendant ran a self-service shop in which non-prescription drugs and medicines,
many of which were listed in the Poisons List provided in the Pharmacy and Poisons
Act 1933, were sold. These items were displayed in open shelves from which they
could be selected by the customer, placed in a shopping basket, and taken to the till
where they would be paid for. The till was operated by a registered pharmacist.
However, the claimant brought proceedings against the defendant for breach of
section 18(1) of the Pharmacy and Poisons Act 1933, which requires the supervision
of a registered pharmacist for the sale of any item in the Poisons List.

Issue

The question was whether the contract of sale was concluded when the customer
selected the product from the shelves (in which case the defendant was in breach of
the Act due to the lack of supervision at this point) or when the items were paid for (in
which case there was no breach due to the presence of the pharmacist at the till).

Held

The Court of Appeal held that the defendant was not in breach of the Act, as the
contract was completed on payment under the supervision of the pharmacist. The
display of the goods on the shelves were not an offer which was accepted when the
customer selected the item; rather, the proper construction was that the customer
made an offer to the cashier upon arriving at the till, which was accepted when
payment was taken. This investigation was supported by the fact that the buyer would

4
(1952) 2 QB 795 at p 802, affirmed, Pharmaceutical society of Great Britain v Boots Cash chemists (Southern)
Ltd, (1953) 1 QB 401 : (1953) 2 WLR 427 (CA)
 have been liberal to return any of the things to the places where they are belonged
before a payment had been made.

Main Differences between Offer and Invitation to Offer (or Treat)

The main points of difference between offer and invitation to treat are described below:

1. An offer is the final willingness of the party to create legal relations. An invitation to
treat is not the final readiness of the offeror but the interest of the party to make public
to offer him.

2. An offer is defined in section 2 (a) of the Indian Contract Act, 18725. Contrarywise,
an invitation to treat or offer is not defined in the Indian Contract Act, 1872.

3. An offer is an essential element to make an agreement between the parties, but an

invitation to offer is not an important element until it becomes an offer.

4. An offer becomes an agreement when accepted. Instead, an invitation to treat will

become an offer when the other party accepts it.

5. The main objective of making an offer is to enter into the contract, whereas the main
objective of an invitation to offer is to negotiate the terms on which the contract can
be made.6

5
Section 2(a) Indian Contract Act 1872

6
.
Surbhi S Difference between Offer and Invitation to Offer Apr 15,2015
https://keydifferences.com/difference-between-offer-and-invitation-to-offer.html#KeyDifferences
 Bibliography

 Contract & Specific Relief By Avtar Singh

 Indian Contract Act 1872 By RK Bangia
 https://www.translegal.com/lesson/7073
 https://www.toppr.com/guides/business-laws/indian-contract-act-1872-part-
i/proposal-or-offer/
 https://keydifferences.com/difference-between-offer-and-invitation-to-offer.