CONTRACT – OFFER AND ACCEPTANCE

Offer (Pg 63)

Specific An offer is an expression made by one party to another party. For an offer to be effective, the
Offeree offer must be communicated to the offeree.
Unilateral In a unilateral contract, the offeror may not know the offeree’s identity immediately. Carlill v
Contracts Carbolic Smoke Ball Co. (1892) – Although the offer is made to the world, the contract is made
is that limited portion of the public who came forward to perform the condition on the faith of the
advertisement.
Invitation to Generally, an advertisement does not constitute an offer. At law an invitation to treat is an
Treat invitation to commence negotiations or to make an offer. Accordingly, acceptance of an invitation
to treat does not lead to a contract. Partridge v Crittenden (1968).

Display of goods and prices in a shop is usually considered to be an invitation to treat also.
Pharmaceutical Society of Great Britain v Boots Cash Chemists (Southern) Ltd (1952) the
court held that the display of goods with prices constituted an invitation to treat and the sale took
place at the counter in the presence of the pharmacist. Affirmed by the Singapore High Court in
Chwee Kin Keong & Others v Digilandmall.com Pte Ltd (2004).
Provision of A mere response to a request for information does not constitute an offer. Harvey v Facey
Information (1893) – The court held that there was no contract because provision of information was not an
offer.

Acceptance (Pg 67)

An acceptance must be made in writing, orally or by conduct. Whatever its form, communication constitutes an
acceptance only if it is an unconditional expression of assent to the terms of the contract. Conditional
Acceptance is treated as no acceptance.
Once the offeree is aware of the offer, it does not matter that he was prompted to act for reasons other than
the desire to accept the offer. William v Carwardine (1833) – the court held that the plaintiff was entitled to
Knowledge of

a reward because when giving the information sought by the police, she had done so with knowledge of the
Offer

reward even though her motive for giving the information was her own remorse.

Cross Offers – Tinn v Hoffman & Co (1873) – the court held that cross offer did not make a contract. The
reasoning appears to imply that the lack of consensus or meeting of minds between the parties at the time
of making the offers.
Acceptance
CommN of

For an acceptance to be effective, it must be communicated to the offeror. If in writing, it must be physically
received by the offeree, and if orally, heard by the offeree. obiter dictum in Entores Ltd v Miles Far East
Corporation (1955)

Waiver
The may arise in the case where the offer is made to the whole world. In such a situation, the contract may
be accepted by anyone, creating a unilateral contract. Carlill v Carbolic Smoke Ball Co. (1892)

Silence
For this to be effective, both parties must agree to it. Felthouse v Bindley (1862) – It was held that there
was no contract between the two parties. The plaintiff had no right to impose a condition that a sale
contract would come into existence if the defendant remained silent. In a case where the parties agree that
Exceptions

the offeree would have a positive obligation to communicate only if he wishes to reject the offer, is rare.
Southern Ocean Shipbuilding Co Ltd v Deutsche Bank AG (1993)

The Postal Rule

The acceptance is deemed to have been effect effective as soon as the letter is posted regardless as to
when it reaches the offeror or whether it reaches him at all. Adams v Lindsell (1818) – the court held that
the acceptance was communicated and the contract was formed as soon as the plaintiff posted the
acceptance letter. Lee Seng Heng v Guardian Assurance Co Ltd (1932)

It should only be applied where it is clear that parties agree that acceptance should be sent by post. An
offer sent by telegram should not attract the postal rule: Quenerduaine v Cole (1883). The postal rule can
be avoided when parties expressly provide for it then acceptance should be received physically.
 Instantaneous Communications
- by phone  general rule apply
- by internet / telex 
- s11 ETA states that an offer or acceptance can be sent electronically in the form of an electronic
record.
- s13(1), s13(2) ETA states that generally an electronic record is deemed sent by originator himself,
someone authorized by him or by an information system programmed by or on behalf of the
Exceptions

originator to operate automatically.

- s14 ETA states that there are provisions for a party to require an acknowledgement of receipt to
ensure messages have been received properly.
Account designated by addressee?
- No s15(2b)  receipt occurs at the time the electronic record enters the information system of the
addressee.
- Yes s15(2a)
Is it sent to the designated account?
- Yes  receipt occurs and acceptance communicated
- No receipt occurs when electronic record is retrieved by addressee.

Termination of Offer and Acceptance (Pg 75)

The general rule is that an offer can be withdrawn at any time prior to acceptance. When an
offer is withdrawn, the offer is said to be revoked. A revocation of an offer must be communicated
to the offeree. Revocation is only effective when the offeree receives notice of the revocation.
Byrne v Van Tienhoven (1880) – It was held that the revocation was not effective until it was
received by the plaintiff. Since the offer was accepted prior to the revocation, there was a valid
contract.

A reliable third party can also communicate a valid revocation. Dickinson v Dodds (1876) The
English Court of Appeal that Dodds had validly withdrawn his offer to Dickinson even though this
was done through a third party.

A Fresh Offer supercedes the earlier offer: Banque Paribus v Citiback NA (1989) – The
Singapore High Court held that the first offer which had not been accepted was withdrawn
Withdrawal successfully.

If offer is opened for a fixed period?

Routledge v Grant (1828) It was held that it was permissible for Grant to withdraw his offer
during the six weeks period despite the implied assurance that the offer would remain open during
this period. The rationale is that an offeree cannot enforce an offeror’s promise to keep his offer
open unless there is separate contract supported by consideration to do so, such contracts are
called options. – Tay Joo Sing v Ku Yu Sang (1994)

Unilateral Contracts?
In Abbot v Lance (1860), it was held that the offeror cannot withdraw his offer once the offeree
has started to act. In Dickinson Trading (S) Pte Ltd v Transmarco Ltd (1989), obiter dictum 
the offeror in a unilateral contract has an obligation not to revoke the offer after the offeree has
embarked on the performance of the conditions.
An offer can also be terminated when an offeree rejects then offer. Rejection may be made in
writing, orally or by conduct. Once communicated, a rejection extinguishes the offer and the offer
cannot be revived.
Rejection
A counter offer is construed as rejecting the initial offer. Thus, anything less than a unconditional
and counter
acceptance may be viewed as a counter offer which rejects the original offer. Hyde v Wrench
offer
(1840) – The court held that there was no contract because Hyde’s reply was a counter offer,
which extinguish the earlier offer. When the response is an inquiry or a request of information, it
should not be construed as an offer. ‘The Masters Stelios’; Monvia Motorship Corporation v
Keppel Shipyard (Pte) Ltd ) (1983)
If the offer is opened for a specified period, a purported acceptance after that period would be
Lapse of effective since the offer had lapsed. In certain circumstances, the court may imply that the offeror
time has specified the period of offer even if he has not done so expressly: Wee Ah Lian v Teo Siak
Weng (1992).
 When no specified period of time is expressed, an offer would lapse after a reasonable amount of
Lapse of time, (depending on the facts of the case). Ramsgate Victoria Hotel Co v Montefiore (1866) –
time the court held that Montefiore could refuse to take up the shares because his offer had lapsed
after a reasonable time.
An offer may be made conditional such that the if the condition is not met, the offer is
automatically terminated. Financings Ltd v Stimson (1962) – The English Court of Appeal held
Failure of that Stimson was not bound to the contract because there was an implied condition that at the
Condition time of acceptance by the plaintiff, the car would be in substantially the same state as when the
offer was made by Stimson. The condition was broken and therefore the offer was no longer
available for acceptance.
Dickinson v Dodds (1876)  if the man who makes an offer dies, the offer cannot be accepted
after he is dead.
Bradbury v Morgan (1862)  the court held that the death of an offeror did not terminate the
Death
offer unless the offeree had notice of the offeror’s death.
Reynolds v Atherton (1921)  Offeree dies before acceptance, this offer cease to be capable of
acceptance.
Termination
of Acceptance cannot be revoked. Wenkhiem v Arndt (1873)
Acceptance