Harvey v Facey [1893] AC 552 Privy Council Harvey sent a Telegram to Facey which stated: "Will you sell

us Bumper Hall Pen? Telegraph lowest cash price-answer paid;" Facey replied by telegram:"Lowest price for Bumper Hall Pen 900." Harvey then replied:"We agree to buy Bumper Hall Pen for the sum of nine hundred pounds asked by you. Please send us your title deed in order that we may get early possession." Held: The Privy Council held that there was no contract concluded between the parties. Facey had not directly answered the first question as to whether they would sell and the lowest price stated was merely responding to a request for information not an offer. There was thus no evidence of an intention that the telegram sent by Facey was to be an offer. Carlill v Carbolic Smoke Ball Co [1893] 1 QB 256 Court of Appeal A Newspaper advert placed by the defendant stated:100 reward will be paid by the Carbolic Smoke Ball Company to any person who contracts the influenza after having used the ball three times daily for two weeks according to the printed directions supplied with each ball... 1000 is deposited with the Alliance Bank, shewing our sincerity in the matter." Mrs Carlill purchased some smoke balls and used them according to the directions and caught flu. She sought to claim the stated 100 reward. The defendant raised the following arguments to demonstrate the advertisement was a mere invitation to treat rather than an offer: 1. The advert was a sales puff and lacked intent to be an offer. 2. It is not possible to make an offer to the world. 3. There was no notification of acceptance. 4. The wording was too vague to constitute an offer since there was no stated time limit as to catching the flu. 5. There was no consideration provided since the 'offer' did not specify that the user of the balls must have purchased them. Held: The Court of Appeal held that Mrs Carlill was entitled to the reward as the advert constituted an offer of a unilateral contract which she had accepted by performing the conditions stated in the offer. The court rejected all the arguments put forward by the defendants for the following reasons: 1. The statement referring to the deposit of 1,000 demonstrated intent and therefore it was not a mere sales puff. 2. It is quite possible to make an offer to the world. 3. In unilateral contracts there is no requirement that the offeree communicates

an intention to accept, since acceptance is through full performance. 4. Whilst there may be some ambiguity in the wording this was capable of being resolved by applying a reasonable time limit or confining it to only those who caught flu whilst still using the balls. 5. The defendants would have value in people using the balls even if they had not been purchased by them directly. Pharmaceutical Society of Great Britain v Boots [1953] 1 QB 401 Court of Appeal Boots introduced the then new self service system into their shops whereby customers would pick up goods from the shelf put them in their basket and then take them to the cash till to pay. The Pharmaceutical Society of Great Britain brought an action to determine the legality of the system with regard to the sale of pharmaceutical products which were required by law to be sold in the presence of a pharmacist. The court thus needed to determine where the contract came into existence. Held: Goods on the shelf constitute an invitation to treat not an offer. A customer takes the goods to the till and makes an offer to purchase. The shop assistant then chooses whether to accept the offer. The contract is therefore concluded at the till in the presence of a pharmacist. Fisher v Bell [1961] 1 QB 394 The defendant had a flick knife displayed in his shop window with a price tag on it. Statute made it a criminal offence to 'offer' such flick knives for sale. His conviction was quashed as goods on display in shops are not 'offers' in the technical sense but an invitation to treat. The court applied the literal rule of statutory interpretation. Partridge v Crittenden (1968) 2 All ER 421 The defendant placed an advert in a classified section of a magazine offering some bramble finches for sale. S.6 of the Protection of Birds Act 1954 made it an offence to offer such birds for sale. He was charged and convicted of the offence and appealed against his conviction. Held: The defendant's conviction was quashed. The advert was an invitation to treat not an offer. The literal rule of statutory interpretation was applied.

Spencer v Harding Law Rep. 5 C. P. 561 The defendants advertised a sale by tender of the stock in trade belonging Eilbeck & co. The advertisement specified where the goods could be viewed, the time of opening for tenders and that the goods must be paid for in cash. No reserve was stated. The claimant submitted the highest tender but the defendant refused to sell to him. Held: Unless the advertisement specifies that the highest tender would be accepted there was no obligation to sell to the person submitting the highest tender. The advert amounted to an invitation to treat, the tender was an offer, the defendant could choose whether to accept the offer or not. Heathcote Ball v Barry [2000] EWCA Civ 235 The claimant had submitted the highest (and only) bids at an auction stated to be without reserve. The items were two Alan Smart engine analysers which were worth 14,000. The claimant had submitted bids of 200 each. The auctioneer refused to sell them at that price. The claimant brought an action for breach of contract claiming damages of 27,600. Held: The claimant was entitled to damages. Where an auction takes place without reserve the auctioneer makes a unilateral offer which is accepted by submitting the highest bid. There was thus a binding contract and the claimant entitled to damages covering the loss of bargain.

Thornton v Shoe Lane Parking [1971] 2 WLR 585 Court of Appeal The claimant was injured in a car park partly due to the defendant's negligence. The claimant was given a ticket on entering the car park after putting money into a machine. The ticket stated the contract of parking was subject to terms and conditions which were displayed on the inside of the car park. One of the terms excluded liability for personal injuries arising through negligence. The question for the court was whether the term was incorporated into the contract ie had the defendant brought it to the attention of the claimant before or at the time the contract was made. This question depended upon where the offer and acceptance took place in relation to the machine. Held: The machine itself constituted the offer. The acceptance was by putting the money into the machine. The ticket was dispensed after the acceptance took place and therefore the clause was not incorporated into the contract.

Ramsgate Victoria Hotel v Montefoire (1866) LR 1 Ex 109 The defendant offered to purchase shares in the claimant company at a certain price. Six months later the claimant accepted this offer by which time the value of the shares had fallen. The defendant had not withdrawn the offer but refused to go through with the sale. The claimant brought an action for specific performance of the contract. Held: The offer was no longer open as due to the nature of the subject matter of the contract the offer lapsed after a reasonable period of time. Therefore there was no contract and the claimant's action for specific performance was unsuccessful.

Dickinson v Dodds (1876) 2 Ch D 463 The defendant offered to sell his house to the claimant and promised to keep the offer open until Friday. On the Thursday the defendant accepted an offer from a third party to purchase the house. The defendant then asked a friend to tell the claimant that the offer was withdrawn. On hearing the news, the claimant went round to the claimant's house first thing Friday morning purporting to accept the offer. He then brought an action seeking specific performance of the contract. Held: The offer had been effectively revoked. Therefore no contract existed between the parties. There was no obligation to keep the offer open until Friday since the claimant had provided no consideration in exchange for the promise. The offeror is free to withdraw the offer at any time before acceptance takes place unless a deposit has been paid.

Errington v Errington Woods [1952] 1 KB 290 Court of Appeal A father-in-law purchased a house for his son and daughter-in-law to live in. The house was put in the father's name alone. He paid the deposit as a wedding gift and promised the couple that if they paid the mortgage instalments, the father would transfer the house to them. The father then became ill and died. The mother inherited the house. After the father's death the son went to live with his mother but the wife refused to live with the mother and continued to pay the mortgage instalments. The mother brought an action to remove the wife from the house. Held: The wife was entitled to remain in the house. The father had made the couple a unilateral offer. The wife was in course of performing the acceptance of the offer

by continuing to meet the mortgage payments. Under normal contract principles an offer may be revoked at any time before acceptance takes place, however, with unilateral contracts acceptance takes place only on full performance. Lord Denning held that once performance had commenced the Mother was estopped from revoking the offer since it would be unconscionable for her to do so. Furthermore there was an intention to create legal relations despite it being a family agreement. Dahlia v Four Millbank Nominees [1978] Ch 231 Court of Appeal The claimant wished to purchase some property from the defendant. The terms had been agreed but no written contract had been completed. The defendant promised the claimant that if he arranged for a bankers draft for the deposit to be delivered to the defendant before 10.00 am on the 22nd December he would complete the written contract. The claimant duly complied with the request but the defendant refused to complete. The claimant brought an action stating that unilateral contract existed and the defendant was thus bound by that contract to complete the written contract for the sale of the property. Held: A unilateral contract did exist. Goff LJ stated obiter on the issue of revocation of a unilateral offer:"Whilst I think the true view of a unilateral contract must in general be that the offeror is entitled to require full performance of the condition which he has imposed and short of that he is not bound, that must be subject to one important qualification, which stems from the fact that there must be an implied obligation on the part of the offeror not to prevent the condition becoming satisfied, which obligation it seems to me must arise as soon as the offeree starts to perform. Until then the offeror can revoke the whole thing, but once the offeree has embarked on performance it is too late for the offeror to revoke his offer." Hyde v Wrench (1840) 49 ER 132 Chancery Division (Decided by Lord Langdale MR) The defendant offered to sell a farm to the claimant for 1,000. The claimant in reply offered 950 which the defendant refused. The claimant then sought to accept the original offer of 1,000. The defendant refused to sell to the claimant and the claimant brought an action for specific performance. Held: There was no contract. Where a counter offer is made this destroys the original offer so that it is no longer open to the offeree to accept.

Entorres v Miles Far East [1955] 2 QB 327 Court of Appeal The claimant sent a telex message from England offering to purchase 100 tons of

Cathodes from the defendants in Holland. The defendant sent back a telex from Holland to the London office accepting that offer. The question for the court was at what point the contract came into existence. If the acceptance was effective from the time the telex was sent the contract was made in Holland and Dutch law would apply. If the acceptance took place when the telex was received in London then the contract would be governed by English law. Held: To amount to an effective acceptance the acceptance needed to be communicated to the offeree. Therefore the contract was made in England. Felthouse v Bindley [1862] EWHC CP J35 Court of Common Pleas A nephew discussed buying a horse from his uncle. He offered to purchase the horse and said if I don't hear from you by the weekend I will consider him mine. The horse was then sold by mistake at auction. The auctioneer had been asked not to sell the horse but had forgotten. The uncle commenced proceedings against the auctioneer for conversion. The action depended upon whether a valid contract existed between the nephew and the uncle. Held: There was no contract. You cannot have silence as acceptance. Brogden v Metropolitan Railway (1877) 2 App. Cas. 666 The claimants were the suppliers of coal to the defendant railway company. They had been dealing for some years on an informal basis with no written contract. The parties agreed that it would be wise to have a formal contract written. The defendant drew up a draft contract and sent it to the claimant. The claimant made some minor amendments and filled in some blanks and sent it back to the defendant. The defendant then simply filed the document and never communicated their acceptance to the contract. Throughout this period the claimants continued to supply the coal. Subsequently a dispute arose and it was questioned whether in fact the written agreement was valid. Held: The written contract was valid despite no communication of the acceptance. The acceptance took place by performing the contract without any objection as to the terms. Butler Machine Tool v Ex-Cell-O Corporation [1979] 1 WLR 401 Court of Appeal Ex-Cell-O wished to purchase a machine from Butler. Butler sent out a quotation of 75,535 along with a copy of their standard terms of sale. The terms included a price variation clause and a term that the seller's terms would prevail over any terms submitted by a purchaser. The machine would be delivered in 10 months. Ex-Cell-O put in an order for the machine at the stated price and sent a set of

their terms which did not include the price variation clause. The order contained an acknowledgement slip which required a signature by Butler and was to be returned to Ex-Cell-O. This slip stated that the contract would be subject to the terms stated overleaf. Butler duly signed the slip and returned it. The machines were then delivered and Butler sought to enforce the price variation clause and demanded an extra 2,893. Ex-Cell-O refused to pay. Held: The offer to sell the machine on terms provided by Butler was destroyed by the counter offer made by Ex-Cell-O. Therefore the price variation clause was not part of the contract. The contract was concluded on Ex-Cell-O's terms since Butler signed the acknowledgement slip accepting those terms. Where there is a battle of the forms whereby each party submits their own terms the last shot rule applies whereby a contract is concluded on the terms submitted by the party who is the last to communicate those terms before performance of the contract commences. Adams v Lindsell (1818) 106 ER 250 The defendant wrote to the claimant offering to sell them some wool and asking for a reply 'in the course of post'. The letter was delayed in the post. On receiving the letter the claimant posted a letter of acceptance the same day. However, due to the delay the defendant's had assumed the claimant was not interested in the wool and sold it on to a third party. The claimant sued for breach of contract. Held: There was a valid contract which came in to existence the moment the letter of acceptance was placed in the post box. This case established the postal rule. This applies where post is the agreed form of communication between the parties and the letter of acceptance is correctly addressed and carries the right postage stamp. The acceptance then becomes effective when the letter is posted. Holwell Securities v Hughes [1974] 1 WLR 155 Dr Hughes granted Holwell Securities an option to purchase his house for 45,000. The option was to be exercisable 'by notice in writing' within 6 months. Five days before the expiry, Holwell posted a letter exercising the option. This letter was never received by Hughes. Holwell sought to enforce the option relying on the postal rule stating the acceptance took place before the expiry of the option. Held: By requiring 'notice in writing', Dr Hughes had specified that he had to actually receive the communication and had therefore excluded the postal rule.

Hyde v Wrench (1840) 49 ER 132 Chancery Division (Decided by Lord Langdale MR) The defendant offered to sell a farm to the claimant for 1,000. The claimant in reply offered 950 which the defendant refused. The claimant then sought to accept the original offer of 1,000. The defendant refused to sell to the claimant and the claimant brought an action for specific performance. Held: There was no contract. Where a counter offer is made this destroys the original offer so that it is no longer open to the offeree to accept. Scammell and Nephew v Ouston [1941] AC 251 House of Lords The parties entered an agreement whereby Scammell were to supply a van for 286 on HP terms over 2 years and Ouston was to trade in his old van for 100. There was then some disagreement and Scammel refused to supply the van. Held: There was no certainty as to the terms of the agreement. Whilst there was agreement on the price there was nothing in relation to the HP terms stating whether it would be weekly or monthly instalments or how much the instalments would be.

Sudbrook Trading Estate v Eggleton [1983] AC AC 444 House of Lords A lease gave the tenant an option to purchase the freehold of the property at a price to be agreed by two surveyors one appointed by the tenant and one appointed by the landlord. The tenant sought to exercise the option but the landlord refused to appoint a surveyor. The landlord claimed that the clause was too vague to be enforceable as it did not specify a price. Held: The clause was not too vague to be enforceable as it put in place a mechanism to ascertain the price.