.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.
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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. Case Summary - Blackpool and Fylde Aero Club v Blackpool Borough Council [1990]
Facts of the case The defendant council invited tenders for operating flights from the defendant airport. The tenders should be submitted by 12 noon on 17 March. The plaintiff on 11 am 17 Match delivered a tender into the Town Hall letter box. However, the defendant’s staff only emptied the box the next morning. The plaintiff ‘s tender was stamped with 18th March. It is believed by the defendant that the plaintiff’s tender was submitted late and because of that, did not consider it and awarded the concession to another company. Held There was an implied offer in the invitation to tender where the timely tenders would be considered. By submitting the timely tender, the plaintiff had accepted the offer. Conclusion There was an implied offer in the form of timely tenders in the invitation to tender. Case Summary- Harvela Investments v Royal Trust Co of Canada [1985]
Facts of the case The defendant R invited the plaintiff H and a second defendant O to submit the sealed bids doe specific shares. The defendant R, promised to accept the highest bid. H bid $2 175 000 and O bid $2 100 000 and $101 000 more than any other offer. As a result, R believed that he he was bound to sell to O the shares for $2 276 000. R’s solicitor sent a telex to O and H stating that ‘in the circumstances, our clients are bound to accept and do herby accept the offer received from O H sought an order for specific performance and a declaration that R was bound to transfer the share to it. Held R’s invitation to bid created a fixed bidding sale. Therefore, it was not consistent with the intention to accept referential bids (the bids that are based on reference to other bids). As a result, R was obliged to accept H’s bid as the highest bid submitted that was valid. The telex was not an offer or acceptance of any new contract. It was an attempt to fulfill the existing obligations between R and O. In conclusion, no obligation to sell shares to O. Conclusion The invitation to bid created a fixed bidding sale where the defendant was obliged to accept the highest bid and not referential bid. Case Summary - Gibson v Manchester City Council [1979]
Facts of the case A letter was sent by the defendant to the plaintiff with words such as ‘the corporation may be prepared to sell the house…. If you would like to make a formal application to buy your council house, please complete the enclosed application form and return to me as soon as possible’ The plaintiff returned the form and seeking a lower price. However, the defendant refused to do so. The plaintiff asked for the application to proceed as per his application. Due to the change of control of the defendant council from the Conservatives to the Labour Party, the sale of the house to the plaintiff was refused. Held In Court of Appeal, Lord Denning MR stated that there was an agreement for the sale of the house between the parties after looking at the correspondence as a whole. Lord Diplock in House of Lord however stated that ‘I can see no reason in the instant case for departing from the conventional approach of looking at the…documents…and seeing whether on their true construction there is to be found in them a contractual offer by the council to sell the house to Mr. Gibson and acceptance of the offer by Mr. Gibson’ Based on the conventional approach it was found by the House of Lords that the defendant council had not made a contractual offer to the plaintiff. Case Summary- Partridge v Crittenden [1968]
Facts of the case Mr Partridge is a defendant who advertised the sale of bramblefinches at 25 shillings each in a classified advertisement in the periodical, ‘Cage and Aviary Bird’. It was an offence under the Protection of Birds Act 1954 to offer for sale live birds including bramblefinches. Held Per Lord Parker CJ, a circular and advertisement could not be supposed to bind its author to sell to anyone answering the advertisement in an unlimited number of some product. Per Ashworth and Blain JJ the case of Fisher v Bell must be followed where the advertisement was not an offer for sale. Conclusion An advertisement in a newspaper is an invitation to treat. Case Summary –Fisher v Bell [1961]
Facts of the case The window display of the defendant’s shop included a flick knife with the label ‘Ejector knife 4s’. It was an offence under the Restriction of Offensive Weapons Act 1959 to offer for sale such a knife. Held To display a good in a shop window is not to make an offer for sale. The phrase offer for sale should be given its meaning in a general contract law. In this case, display in the window is merely an invitation to treat. Case Summary- Grainger & Son v Gough [1896]
Facts of the case The appellants were wine merchants. They were also the agents for Lois Roederer. Lois Roederer was the French wine and champagne merchant. A circulated price list of wines from Lois Roederer was circulated. Orders were taken and passed to Roederer who sent the wine from French. Commission was given to the appellants from Roederer on all wine sold. The respondent, tax inspector sought to tax the appellants as if they were carrying on trade in the UK. Held There was no contract in the UK. The contracts were made with Roederer in France not with the appellants in England. Per Lord Herschell LC , the price list does not amount to an offer to supply and unlimited quantity of the wine as described in the price name. Offers were made when the customers placed the orders and later accepted by Roeder |
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