Case Summaries - Butler Machine Tool Co.Ltd v Ex Cell O Corporation ( England) ltd [1979]10/15/2021 Butler Machine Tool Co.Ltd v Ex Cell O Corporation ( England) ltd [1979]
Facts of the case The plaintiff seller made an offer to cell a Butler Column Plane Miller machine on 23rd May 1969 to the defendant buyer. The seller’s standard terms were incorporated into the offer. The terms were printed on the reverse side. One of the terms read ‘all orders are accepted only upon and subject to the terms set out in our quotation and the following condition. These terms and conditions shall prevail over any terms and conditions in the buyer’s order.’ The order was placed by the buyer which included the buyer’s own standard terms and a slip that said ‘please sign and return to Ex- CELL – O. We accept your order on the terms and conditions stated there on’ On 5th June, the seller signed and returned the slip with a covering letter stated that’ please sign and return to Ex-Cell –O. We have pleasure in acknowledging receipt of your official order…This being delivered in accordance with out revised quotation on 23rd May ….. We returned herewith duly completed your acknowledgement of order form.’ Later the machine was made by the seller. The machine was later delivered to the buyer. The seller’s terms included a clause which allowed an increase in price while the buyer terms did not. The buyer refused to pay the higher price demanded by the seller. Held The buyer’s term prevailed. The lower price was paid. Lord Denning MR said…’in many of the cases, our traditional analysis of offer, counter offer, rejection, acceptance and so forth is out of date….The better way to look at all the documents passing between the parties and glean from them, or from the conduct of the parties, whether they have reached agreement on material on all material points.’
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Tinn v Hoffman & Co. [1873]
Facts of the case The letter was written by the defendant to the plaintiff on 24th November 1871. It stated ‘we offer you 800 tons with 200 tons delivered per month of March, April May and June 1872 at the price of 69s per ton. Waiting your reply by return.’ The plaintiff failed to reply but on 27th November stated that the price is too high. The plaintiff stated that if the quantity of 1200 tons ordered and delivered (with 200 tons per month for the first six months next year,) will the defendant lower the price? The plaintiff asking for a reply from the defendant. On 28th November 1871, the defendant replied that he willing to make an offer for further 400 tons with 200 tons on January and another 200 tons being delivered on February with the same price as quoted originally on 24th November 1871. The defendant wanted a reply whether to accept the offer or not. On the same day, without receiving and reading the reply from the defendant, the plaintiff wrote a letter where it stated that the defendant can enter the 800s tons on the terms and conditions named in the defendant favour on the 24th November and believing that the defendant will enter the 400s ton making 1200 tons at the price of 68s per ton. The defendant gave the plaintiff one more chance to buy the pig irons at 69s per ton. The plaintiff replied later than was required. The defendant refused to sell him any iron since the market price for iron had risen. Held It was held that there was no binding contract. The offer on 24th November was rejected because the plaintiff failed to reply by return or because the plaintiff letter on 27th November was a rejection. The letter by the defendant on 28th November made a new offer of 1200 tons and it did not revive the old offer of 800 tons. It was not open for the plaintiff to accept 800 tons. In obiter, Keating, Brett and Blackburn JJ provided that even if the plaintiff’s letter at 28th November had been in the same terms as the defendant’s letter of the same day there would still be no contract. This is because per Blackburn J, the promise or offer being made on each side in ignorance of the offer on the other side neither of them can be construed as an acceptance of the other. Conclusion A counter offer constitutes a rejection to the original offer. Hyde v Wrench [1840]
Facts of the case The plaintiff received an offer from the defendant to sell the farm for 1000 gbp.( great Britain pound sterling) The defendant rejected when the plaintiff offered to pay 950 Great Britain pound sterling. Plaintiff purported to accept the original offer to sell at 1000 Great Britain pound sterling. The defendant refused. Later the plaintiff sought specific performance of the sale at 1000 Great Britain pound sterling. Held The plaintiff had rejected the original offer by making a counter offer. The rejection of an offer cancel its binding effect. As a result there was no contract between the parties. Conclusion Counter offer is a rejection to the original offer. .Harvey v Facey [1893]
Facts of the case On the same day, three telegrams were passed between parties. First, the respondents received a telegraph from the appellants stated ‘will you sell us Bumper Hall Pen? Telegraph the lowest cash price.’ The respondent replied ‘ lowest price for Bumper Hall Pen is 900 gbp’ The appellants in return the telegraphed ‘ we agree to buy Bumper Hall Pen for the sum of 900 gbp. Please send us your title deed in order we may get early possession’. The appellants sought an order for specific performance when the respondent did not complete the sale. Held It was held that there was no contract. Per Lord Morris ‘ The first telegram asked two questions…the respondent replies to the second question only and gives his lowest price …the reply telegram from the appellants cannot be treated as an acceptance of an offer to sell them. It is an offer that required to be accepted by the respondent.’ Conclusion Answering a question is not an offer. Barry v Davies [2000]
Facts of the case The defendant auctioneers under the instruction of the custom and excise conducted an auction for 2 new machines which were worth about 14000 gbp each without reserve. The claimant made a bid of 200 gbp for each of the machine but the auctioneer refused to accept the bid because the bid was too low. The auctioneer withdrew the machines. The machines were later sold for 1500 gbp each later. The claimant sued the defendant for breach of the contract. The trial judge based on collateral contract where the auctioneer supposed to sell to the highest bidder held in the claimant favor. Damage worth 27600 gbp was awarded to the claimant. The decision was later appealed by the defendant contending an auction without reserve did not create an obligation to sell to the highest bidder and no consideration for the promise of the auctioneer. Held Following Warlow v Harrison, the court of appeal dismissed the appeal. A sale without reserve means making a binding commitment to sell to the highest bidder. There was an obligation under the collateral warranty for the auctioneer to sell to the highest bidder and failure would amount to breach. There was a consideration for the auctioneer’s promise. It was in the form of detriment to the bidder when the bid was accepted and benefit for the auctioneer due to the sale. Conclusion An auctioneer who makes a sale ‘without reserve’ is making a binding commitment to sell to the highest bidder. Warlow v Harrison [1859]
Facts of the case The plaintiff bid for one of the horses. The defendant advertised an auction of three horses without reserve. Later there was a higher bid from the vendor of the horses. The plaintiff claimed the horse from the vendor and bid no further. The plaintiff offered the vendor the amount of the plaintiff last bid. However, the vendor refused. Held Per Martin B, “the auctioneer who puts the property up for sale upon such condition pledges himself that the sale shall be without reserve; or in other words, contract that it shall be so.. the contract is made with bona fide bidder.” The acceptance of vendor’s bid amounted to reserve price. Therefore, the plaintiff was entitled to damages based on his contractual right to buy the horses. Conclusion The bidder has the contractual rights to buy the property at the highest bid without reserve. Payne v Cave [1789]
Facts of the case The defendant bid at an auction. However, he later withdraw the bid before the fell of the hammer. Held The defendant is not bound to buy the lot. Each bid is an offer. The offer can be withdrawn before it is accepted by knocking down the hammer. Conclusion In an auction, each bid is an offer which means that it can be withdrawn before it is accepted by the fell of the hammer. |
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