OCR A2 Law - The Law of Contract - Formation of a Contract - Offer (2)

  • Created by: Majid
  • Created on: 14-03-13 11:30

Formation of a Contract - Offer (2)

Problems have arisen when parties are not in a traditional shopping situation and are negotiating through correspondance. Judges must figure out exactly when the statements are firm enough to amount to an offer. In "Gibson v Manchester City Council", Gibson received a letter which was an "ITT", he filled out a form and this was the "Offer". However the council rejected it as the letter stated stated they "may be prepared to sell", therefore, no contract existed.

The concept of shops displaying goods protects the seller as stated above. This has been further reinforced by Winfield who said that "shops are places for baragaing and not compulsory sales". This can allow sellers to freely negotiate with who they want to, and this supports the power to contract with whoever they wish.

Another way in which an ITT has been recognised is when parties make mere statement of price. In this particular area, if a party indicates a price that they find acceptable this is "Harvey v Facey". In this case Harvey wanted to buy Facey's farm by sending a telegram in which the statement said "lowest price acceptable was £900". However, this wasn't an offer, but an ITT and his price couldn't be accepted.

AO2:This allows the seller to sell their products at a price they find reasonable as in this case he may hvae wanted more than £900, and by allowing this it protects the seller.

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