Case Law 1
Carllil vs. Carbolic Smoke Ball Co. [(1893) 1 Q.B. 256]
A company called Carbolic Smoke Ball Company has prepared a medicine for influenza. The medicine was called’ The Carbolic Smoke Ball’ and an advertisement was placed in a newspaper and magazines saying that anyone who contracted the flu after using the medicine according to the printed instructions would be given a hundred pounds. Lady Carllil bought the medicine and used it according to the printed instructions, but she was attacked by influenza.
She was suing for a hundred pounds and won the case. She won the case because the offer made by the company was a general offer and anyone reading the advertisement could accept the offer. Since the medicinal product did not meet with the condition offered, the company was bound to compensate Mrs. Carlill.
Case law 2
Harbhajan Lal vs. Harcharan Lal (AIR 1924 A11. 539)
In this case, the son of Harcharan Lal ran away from home, and the father issued a pamphlet offering five hundred rupees to anyone who would bring his boy home. Harbhajan Lal saw the boy at the railway station and sent a telegram to the boy’s father.
He was entitled to the reward because he managed to find the boy. The offer made by Harcharan Lal was a general offer made to the word at large, and anyone who read the offer was able to accept it.
2.2 Conditions for Valid Offer
There are various rules for valid offer. These rules are mentioned below:
- The Offer Must Give Rise to Legal Relations : The intension of the offeror must be to create a legal relationship with the offeree. An offer which does not create legal obligation does not form a contract. For instance a social invitation even if accepted will not result in a contract.
Case Law 3
Balfour vs. Balfour Ibid lesson 1 Case Law 1
Mr. Balfour went to England for a vacation with his wife. He was instructed by his employer to return to Ceylon. His wife could not accompany him back to Ceylon due to ill health. Mr. Balfour promised his wife a monthly maintenance amount. After some time, he stopped sending the maintenance. Mrs. Balfour then filed a case against her husband in order to recover the amount promised. The case was dismissed by the court as it considered that it was a domestic matter which did not establish a legal relationship and therefore could not be regarded as a valid contract.
Illustration
Sati invited Rati to her birthday party, and Rati accepted the invitation. This is not a valid offer because, if Rati fails to attend the birthday party sati, he can not take any legal action for breach of contract.
- The Offer Must be Definite and Certain: The terms of an offer must not be ambiguous and vague.
Case Law 4
Taylor vs. Portington [(1985) All E.R. 128]
In this case, the offeror offered to rent a house for three years at 285 pounds per year, provided that the house was repaired and the living rooms had been beautifully decorated in the fashion that prevailed. The offer does not result in a legal relationship because some of the terms of the offer are quite vague.
Case Law 5
Gould Vs Gould [(1970) 1 Q.B. 275]
A husband, while breaking up his marriage, promises his wife to pay him 15 pounds a week as long as he can. Again, the terms of the offer are vague and discretionary.
Illustration
Shyam asks Geeta, „Will you buy my laptop for rupees 35,000 or 40,000‟. This cannot be a valid offer because the offer is not definite. Shyam has quoted two prices for the laptop rupees 35,000 and 40,000.
- An Offer is Different from a Mere Declaration of Intension: A declaration of intension is a statement made by a person indicating his or her willingness to make an offer in the future.
Case Law 6
Farina vs. Fickus [(1900) 1 Ch 331]
A person wrote to his son-in-law that his daughter would have a share of what he left after his wife died. The letter is a declaration of intent and not an offer.
Illustration
Shobha, a student doing her bachelor's degree in commerce, met Nirmalya, a Management Institute Director, and told him she would like to join his institute for an MBA degree after completing her graduation degree. Shobha has just transmitted her intension from his institute to Nirmalya to pursue a MBA degree course.
- An Offer is Different From an Iinvitation to Offer: In an invitation to offer a person proposes certain terms for negotiation with the other party and thereby invites the other party to make an offer on those terms.
Case Law 7
Pharmaceutical Society of Great Britain vs. Boots Cash Chemists [(1953) 1 Q.B. 40 331]
Goods were displayed in a shop with a price tag attached to it. A customer picked the goods to purchase. In this case the display of goods is an intension to make an offer and the customer’s selection of goods is an offer to the cashier to purchase the goods. The contract is only concluded once the cashier accepts the customer’s offer to buy.
Illustration
A vegetable vendor sitting at a corner on the street is inviting the passerby to make an offer to him for buying his vegetables.
- The Offer Should Not Contain a Term The Non-compliance of Which Would Amount to Acceptance: The person who makes an offer cannot say to the offeree that if he or she does not communicate acceptance by a certain time the offer will be considered as accepted.
Illustration
Sati who stays in Kerala makes an offer through a letter to sell her house in Cochin to Revati who stays in Madhya Pradesh. She mentions in the letter that if Revathi does not reply in two weeks time she would consider the offer to be accepted. This offer is invalid.
- An Offer Must be Communicated: An offer must be communicated to the offeree because acceptance by the offeree can be given only after he or she has come to know of the offer.
case law 8
Lalman Shukla vs. Gauri Dutt [(1913) ALL. L.J. 389]
A person sent his servant to track down his missing nephew. After the servant left, he announced a reward for tracking down his missing nephew. He announced a reward of five hundred and one rupees. The servant traced the nephew, but he was ignorant of the reward offered. He claimed the reward later.
The Court held that there can be no acceptance unless there is knowledge of the offer, and since the servant did not know the reward when he found the boy, he was not entitled to the reward.
Illustration
Saraswati made an offer to sell her Mercedes Benz to Shweta through a letter. She put the letter in an envelope and kept it in the drawer. She forgot posting the letter. Hence the offer never reached the offeree.
- A Statement of Price is Not an Offer: A statement of price is just information and not an offer.
case law 9
Harvey vs. Facey [(1893) App. Cas 552]
Harvey sent a telegram to Facey which said „Will you sell us your Bumper Hall Pen? Telegraph lowest cash price.‟ To this Facey sent a telegram which said „Lowest price for Bumper Hall Pen is Nine hundred pound.‟ Harvey again sent a telegram to Facie, which said, „ We agree to buy Bumper Hall Pen for the sum of nine hundred pound asked by you.‟ It was held that there was no contract because the first telegram sent by Harvey to Facie had two questions out of which Facie replied to only one question regarding the price. He did not reply to the other question, which was for his acceptance to sell. Thus Facie in his telegram only gave information to Harvey regarding the price of the product he neither made an offer nor accepted the offer made by Harvey.