Bizlawpresentationofferandacceptanceconfirmed 1317123960 Phpapp02 110927064721 Phpapp02

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Project Offer and Acceptance By Kelvin Koh Tong Weng (1.1) Tan Jing Ren (1.2) Lee Yan Gen (1.3) Huang Zhongming (2.1) Philip Tai Khan Siong (2.2) Joash Goh Zhi Rong (2.3) 1

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Transcript of Bizlawpresentationofferandacceptanceconfirmed 1317123960 Phpapp02 110927064721 Phpapp02

Business Law Project- Offer and Acceptance

Business Law ProjectOffer and AcceptanceBy Kelvin Koh Tong Weng (1.1)Tan Jing Ren (1.2)Lee Yan Gen (1.3)Huang Zhongming (2.1)Philip Tai Khan Siong (2.2)Joash Goh Zhi Rong (2.3)

1Letter of Offer sent from A to H Terms: RECEIVES Letter of Acceptance by 11am the next dayH posted Letter of Acceptance A sold memorabilia to someone elseA wrote Letter of Revocation at 5pmA receives Letter of Acceptance at 9amH receives Letter of Revocation at 830amMondayTuesdayQn 1.1Timeline of Events2Qn 1.1 (a)Advise Hannah on her legal rights, if any. 3Letter of Offer sent from A to H Terms: RECEIVES Letter of Acceptance by 11am the next dayH posted Letter of Acceptance A sold memorabilia to someone elseA wrote Letter of Revocation at 5pmA receives Letter of Acceptance at 9amH receives Letter of Revocation at 830amMondayTuesdayIssues (a)Which came first? Acceptance or Revocation?2. Does Postal Acceptance Rule Apply?45Analysis and ApplicationLetter of Offer sent from A to H Terms: go ahead with sale at $100,000 if she RECEIVES Letter of Acceptance by 11am the next dayIntention to EXCLUDE Postal Acceptance Rule- Letter of Acceptance only valid upon RECEIPT6Applying the Exception to PAR rule: The PAR cannot apply when there are express terms in the offer specifying that acceptance must reach the offeror Holwell Securities Ltd v Hughes (1974) 7Letter of Offer sent from A to H Terms: RECEIVES Letter of Acceptance by 11am the next dayH posted Letter of Acceptance A sold memorabilia to someone elseA wrote Letter of Revocation at 5pmA receives Letter of Acceptance at 9amH receives Letter of Revocation at 830amMondayTuesdayQn 1.1Timeline of Events8Analysis and ApplicationLetter of Offer sent from A to H Terms: go ahead with sale at $100,000 if she RECEIVES Letter of Acceptance by 11am the next dayIntention to EXCLUDE Postal Acceptance Rule- Letter of Acceptance only valid upon RECEIPT*Receipt of: LOR 830am LOA 900am

Offer REVOKED before accepted

9ConclusionThe letter of revocation came into effect BEFORE the letter of acceptance.

Thus, Hannah would not be in a strong legal position to sue Alyson for breach of contract.10Qn 1.1 (b)Would it make any difference to your answer if the letter from Alyson to Hannah withdrawing the offer had been received by the latter at 9.30am instead of 8.30am? 11Letter of Offer sent from A to H Terms: RECEIVES Letter of Acceptance by 11am the next dayH posted Letter of Acceptance A sold memorabilia to someone elseA wrote Letter of Revocation at 5pmA receives Letter of Acceptance at 9amH receives Letter of Revocation at 930amMondayTuesdayIssues (b)What if the Letter of Revocation is received 1 hour later?1213Analysis and ApplicationContract comes into existence when A received Letter of Acceptance from H because.*Receipt of: LOA 900am(in effect) LOR 930am (too late)

Offer was ACCEPTED before being revoked14Conclusion (b)The situation would be the exact opposite if the letter of revocation was received at 9.30am instead of 8.30am.

In that situation, the contract would have come into existence at 9am, and Hannah would be in a legal position to sue Alyson for breach of contract 15Letter of Offer sent from Er to K Terms: $50,000 contract. Reply by postEd offered Er contract for $30,000 Er counter offered a contract of $40,000 that was accepted by Ed and in placec. K posted Letter of Acceptance at 11am Qn 1.2Timeline of Eventsa. Er faxed to K to tell him offer of 1 Nov withdrawn

b. Fax received by K at 10.45am. Read at 5pm

1Nov4 Nov5 Nov6 Nov16Qn 1.2 (a)Advise Erwin, Kevin and Edgar of their legal positions. 17Letter of Offer sent from Er to K Terms: $50,000 contract. Reply by postEd offered Er contract for $30,000 Er counter offered a contract of $40,000 that was accepted by Ed and in place1Nov4 Nov5 Nov6 NovIssues (a)K letter of acceptance or Er letter of revocation occurred first?2. Was contract between Er and Ed valid?c. K posted Letter of Acceptance at 11am a. Er faxed to K to tell him offer of 1 Nov withdrawn

b. Fax received by K at 10.45am. Read at 5pm

1819Analysis and Application- Er and KLetter of Acceptance sent by POST from K to Er on 6th Nov @ 11am - Applying Postal Acceptance Rule, acceptance happens right after letter is posted However, Letter of Revocation received by K at 1045am on fax machine

This precedes the sending out of Letter of Acceptance. Applying the rule from the case The Brimnes, it doesnt matter whether it is read or not. 20Letter of Offer sent from Er to K Terms: $50,000 contract. Reply by postEd offered Er contract for $30,000 Er counter offered a contract of $40,000 that was accepted by Ed and in placec. K posted Letter of Acceptance at 11am Qn 1.2Timeline of Eventsa. Er faxed to K to tell him offer of 1 Nov withdrawn (revoke)

b. Revocation Fax received by K at 10.45am. Read at 5pm

1Nov4 Nov5 Nov6 Nov21Analysis and Application- Er and K Letter of Acceptance sent by POST from K to Er on 6th Nov @ 11am - Applying Postal Acceptance Rule, acceptance happens right after letter is posted However, Letter of Revocation received by K at 1045am on fax machine

This precedes the sending out of Letter of Acceptance. Applying the rule, it doesnt matter whether it is read or not. Thus, no contract for K to accept since Letter of Revocation is in effect2223Analysis and Application- Er and Ed Thus, the contract between Erwin and Edgar valid and is binding24Conclusion (a) For the attempt at establishing a contract between Erwin and Kevin, since the letter of revocation from Erwin to Kevin comes into effect before the letter of acceptance from Kevin to Erwin, the contract is void, and the two parties are not contractually bound.

The contract between Erwin and Edgar is binding from the information given in the case.

25Qn 1.2 (b)What would your answer be if 6 November was a nonworking weekend? 26Letter of Offer sent from Er to K Terms: $50,000 contract. Reply by postEd offered Er contract for $30,000 Er counter offered a contract of $40,000 that was accepted by Ed and in placec. K posted Letter of Acceptance at 11am a. Er faxed to K to tell him offer of 1 Nov withdrawn

b. Fax received by K at 10.45am. Read at 5pm

1Nov4 Nov5 Nov6 Nov1. Will the case be altered if 6 Nov is a non-working weekend?Issues (b)273. Postal Acceptance Rule: Acceptance by post takes place when the Letter of Acceptance is posted- Adams v Lindsell (1818)

28Analysis and Application- Non-Working HoursApplying Brinkibon Ltd v Stahag Stahl und Stahlwarenhandels GmbH (1983)

If it was a non-working weekend, communication would not be considered instantaneous Apply working hours to GIVE business efficacy to the contract The Moorcock (1889)

Revocation letter deemed received at start of following Monday instead of weekend

Therefore, when we apply the Postal Acceptance Rule, the Letter of Acceptance comes into effect on 6 Nov before the revocation was communicated and takes effect

29Conclusion (b) Yes, the conclusion of the case will be different. If 6 November was a non-working weekend, the letter of revocation would be deemed to have been received after the letter of acceptance had been posted out, and Erwin and Kevin would be contractually bound.

30Qn 1.2 (c)What is your opinion if Erwin had withdrawn the offer by email instead, which was sent at 10.45am but received at 11.15am? 31Letter of Offer sent from Er to K Terms: $50,000 contract. Reply by postEd offered Er contract for $30,000 Er counter offered a contract of $40,000 that was accepted by Ed and in placeb. K posted Letter of Acceptance at 11am a. Er faxed to K to tell him offer of 1 Nov withdrawn

c. Email sent by Er at 1045am and received by K at 1115am

1Nov4 Nov5 Nov6 NovIssues (c)1. Will the case be altered if revocation is sent by email at 1045am but received at 1115am?3233Analysis and Application- Er and KLetter of Acceptance sent by POST from K to Er on 6th Nov @ 11am - Applying Postal Acceptance Rule, acceptance happens right after letter is posted However, Letter of Revocation received by K at 1115am on by email

Applying the rule from the case The Brimnes

This is after the sending out of Letter of Acceptance. Letter of Revocation does not take effect but Letter of Acceptance doesThus, Er and K would be contractually bound34Letter of Offer sent from Er to K Terms: $50,000 contract. Reply by postEd offered Er contract for $30,000 Er counter offered a contract of $40,000 that was accepted by Ed and in placeb. K posted Letter of Acceptance at 11am a. Er faxed to K to tell him offer of 1 Nov withdrawn

c. Email sent by Er at 1045am and received by K at 1115am

1Nov4 Nov5 Nov6 NovIssues (c)1. Will the case be altered if revocation is sent by email at 1045am but received at 1115am?35Conclusion (c) If the notice of revocation had been sent by email and had been received at 11.15am, the letter of acceptance would have been posted before the notice of revocation was received, and Erwin and Kevin would be contractually bound.

36a. Palin makes Nicki an offerQn 1.3Timeline of EventsMondayb. No reply by Thurs means noWednesdayPalin makes Glenda same offer, she acceptsThursdayNicki calls Palin up, but bag is gone37Qn 1.3 (a)Does Nicki have any right of action for breach of contract against Palin? 38MondayWednesdayThursdayIssues (a)1. Is Palin obliged to keep offer open until Thurs?a. Palin makes Nicki an offerb. No reply by Thurs means NoNicki calls Palin up, but bag is gonePalin makes Glenda same offer, she accepts3940Analysis and Application- Palin and NickiRoutledge v Grant

Palin is not obligedPalin may still retract the offer whenever she wishes to do soHowever, Is the offer still open?41Analysis and Application- Palin and NickiByrne v Van Tienhoven

- Effective revocation needs to be properly communicatedPalin did NOT communicate any revocation noticeTherefore

Palin is contractually bound42Conclusion (a) Non-communication of revocationOffer still in existence

Nicki would be in a legal position to sue Palin for breach of contract

43Qn 1.3 (b)What if Nicki told Palin instead that if she did not reply by Thursday, that means that she would be able and willing to buy the bag?44MondayWednesdayThursdayIssues (b)2. Is silence a valid form of acceptance?a. Palin makes Nicki an offerb. No reply by Thurs means YesPalin makes Glenda same offer, she acceptsNicki calls Palin up, but bag is gone4546Analysis and Application- Palin and NickiRe Selectmove Ltd

If Nicki (offeree) indicates silence as willingness to buyNicki will be requesting for acceptance by silenceAcceptance by silence is valid, since offeree made this request47Analysis and Application- Palin and NickiHowever, from Byrne v Van Tienhoven

Palin would still need to communicate revocation for it to be effectiveFacts of the case unchanged, hence

Palin is still liable for breach of contract48Conclusion (b) Nickis silence could be construed as acceptanceHowever, facts of the case remain unchanged

Nicki would still be in a legal position to sue Palin.

49Qn 1.3 (c)How can Nicki ensure that Palin will keep the offer open only to her up till the end of Thursday? 50MondayWednesdayThursdayIssues (c)3. How may Nicki bind Palin to keeping offer open until Thurs?a. Palin makes Nicki an offerb. No reply by Thurs means NoPalin makes Glenda same offer, she acceptsNicki calls Palin up, but bag is gone5152Analysis and Application- Palin and NickiMountford v Scott

If Nicki wanted the offer to be open only to her until Thursday, she would have had to provide consideration in return for Palins promise to keep the offer open exclusively to her until Thursday.Such consideration may be furnished by buying an option, e.g. making a token payment53Conclusion (c) If Nicki provided some form of consideration e.g. through buying a contract, Palin would be contractually obliged to keep offer open until Thurs

54For the purposes of offers, the law distinguishes shop displays from certain advertisements. It is therefore essential that those who wish to contract over the Internet understand this difference. (per Clive Gringras, The Laws of the Internet).

What in your view is this difference which the author is referring to and how would knowing such information impact upon the way owners of websites create their web advertisements?

You may wish to consider the factual scenario below to assist you in your answer: A web site that offers advertising space to vendors/sellers runs a promotion. The advertisement reads, If you visit our website four times this month and do not buy anything from our vendors, we will credit S$10 to your bank account. What is the effect of section 14 of the Electronic Transactions Act (2010) and does it change the current common law rules distinguishing ITT and offer in any way? Qn 2.155For the purposes of offers, the law distinguishes shop displays from certain advertisements. It is therefore essential that those who wish to contract over the Internet understand this difference. (per Clive Gringras, The Laws of the Internet).

What in your view is this difference which the author is referring to and how would knowing such information impact upon the way owners of websites create their web advertisements?

You may wish to consider the factual scenario below to assist you in your answer: A web site that offers advertising space to vendors/sellers runs a promotion. The advertisement reads, If you visit our website four times this month and do not buy anything from our vendors, we will credit S$10 to your bank account. What is the effect of section 14 of the Electronic Transactions Act (2010) and does it change the current common law rules distinguishing ITT and offer in any way? Qn 2.156What is the difference between shop displays from certain advertisements?Invitation to Treat (ITT)OfferWillingness of 1 party to enter into negotiations with the otherNo intention to be boundClear terms of exchangeIntention to be boundBinds offeror upon acceptance57What is the difference between shop displays from certain advertisements?Invitation to Treat (ITT)OfferShop Display and most advertisements:

E.g. Pharmaceutical Society of Great Britain v Boots Cash Chemists (1953)

Goods on shelf (ITT) Brought to counter (offer to buy) Shop accepts $ and offerCertain Advertisements:

E.g. Carlill v Carbolic Smoke Ball Company (1893)

Used smoke ball 3 times daily according to printed instructions clear and definitive terms58What is the relevance and impact of these differences on web advertisements?

59Difference, Relevance and ImpactNormal Advertising v.s Web AdvertisementsEither traditional advertising or display of goods in shop

Traditional advertising, display of goods and act of purchase can be combined in 1 web pageDifference between ITT, Offer, Acceptance not as distinctImpact: Risk of buyer construing web advertisements as Offer Web merchants may inadvertently be bounded

Therefore, Web merchants should be careful with their use of language60

Email confirmationImmediate and Automated AcceptanceWhat is the relevance of this?61Difference, Relevance and ImpactShop Setting v.s Web Advertisements2. Shop representative at counter can reject buyers offer

No checkpoint. No appropriate qualifiersAcceptance is usually by automated email confirmation right after purchaseImpact: Risk of buyer construing web advertisements as Offer to sell unlimited quantity of goods when web merchants only have limited stock

Therefore, web merchants would need to specify qualifying conditions and escape clauses62The advertisement reads, If you visit our website four times this month and do not buy anything from our vendors, we will credit S$10 to your bank account. No instructions (Ambiguous)Invitation to Treat63Section 14 of the Electronic Transactions Act applies the common law position to the internet, establishing that internet advertisements and interactive online purchase systems are considered invitations to treat unless the language specifically indicates the intention of the party making the proposal to be bound once the proposal is accepted.

The purchaser would thus be the offeror, and the web merchant would be the offeree.Affirms common law64Using the services of a Search Engine (Google or Yahoo!) or open/public news portal (e.g. www.channelnewsasia.com)

Who are the parties involved in the process and is there Offer and Acceptance?

If there is, what makes it appear (fact) and what legal reasoning (law) can you give that the use of such websites is contractual in nature or otherwise? Explain. Qn 2.2

UsersWeb DevelopersWho are the parties involved?IssuesDoes an offer exist?What constitutes acceptance?What kind of contract?Rules Applied:Invitation to Treat (ITT)OfferWillingness of 1 party to enter into negotiations with the otherNo intention to be boundClear terms of exchangeIntention to be boundBinds offeror upon acceptance

To use:You must first agree to the Terms.You may not use the Services if you do not accept the Terms.You can accept the terms by actually using the Services. In this case, you understand and agree that Google will treat your use of the Services as acceptance of the Terms from that point onwards.The terms of service form a legally binding agreement between the user and Google.

Analysis and ApplicationAnalysis and ApplicationThe availability of usage of Search Engines and News Portals are Offers rather than ITTs due to certainty of terms.

To use:You must first agree to the Terms.You may not use the Services if you do not accept the Terms.You can accept the terms by actually using the Services. (acceptance by conduct)In this case, you understand and agree that Google will treat your use of the Services as acceptance of the Terms from that point onwards.The terms of service form a legally binding agreement between the user and Google.

Analysis and ApplicationRules Applied:Unilateral ContractsBilateral ContractsOfferor makes a promise in return for an act to be performed by OffereeOfferor makes a promise in return for a promise on the part of the Offeree

Which is it?Unilateral ContractBilateral ContractOfferor makes a promise in return for an act to be performed by OffereeOfferor makes a promise in return for a promise on the part of the Offeree

It is an exchange of the service providers promise to provide the said services in exchange for the users promise to abide by the terms and conditions outlined in the terms of service Both Offeree and Offeror enforces contractConclusion All elements of contractual offer in place:In certain terms Mode of acceptance is clearly specifiedConsideration in placeIntention to create legal relations is clearly evident

Thus, a user would be obliged to abide by his contractual obligations laid out in the terms of service. Conclusion Contract concluded is a bilateral contract, a promise in return for a promisebreak.

79a) What is your understanding of the objective test to contract law formation issues?

b) What is its relevance and why is it necessary to have such a test?

c) What is the role and function of the test?

d) Finally, in your opinion, is the subjective test more or less desirable a test? Use examples and give reasons for your answer. Qn 2.380Qn 2.3a) What is your understanding of the objective test to contract law formation issues? 81a) What is it?Objective TestThe objective test is a standardwhat a reasonable man would conclude from observation of the action the parties whether agreement has taken place.Qn 2.382Qn 2.3b) What is its relevance and why is it necessary to have such a test? 83b) What is the relevance and necessity of the objective test?OfferObjective test takes into account actions rather than intentionsIntention is considered irrelevantReasonable man perceives offer has been made, then legal intent is consideredEstablish consensus ad idemClarity for agreement

Qn 2.384b) What is the relevance and necessity of the objective test?Smith v Hughes (1871)Facts: Smith offered to sell oats to Hughes, showing him a sample of green oats. Hughes accepted the offer. However, upon receiving the first batch of oats, Hughes claimed that he intended to buy old oats and not green oats.

Hughes refused to pay for the rest of the green oats.Smith sued for breach of contract

Qn 2.385b) What is the relevance and necessity of the objective test?Smith v Hughes (1871)Defendants intention was to buy old oatsBecause of mistake about the oats not liableObjective test used by court:Intentions were ruled irrelevantConduct and words of parties in forming the contract was considered insteadCourt ruled in favour of SmithEstablish clarity and a standard

Qn 2.386Qn 2.3c) What is the role and function of the test? 87c) What is the role and function of the test? Objective TestClarity through actionsFor courts to recognize intentions of parties through tangible meansSet determinable precedenceCertainty for contract law

Credibility of legal system stable framework for business

Qn 2.388d) Is the subjective test more or less desirable a test? Qn 2.389d) Is the subjective test more or less desirable a test? Objective TestSubjective TestConclusion by reasonable person observing actions taken by parties involvedConclusion by intention and own judgment Qn 2.390d) Is the subjective test more or less desirable a test? Hyde v Wrench (1840)Parties made multiple offers and counter offers

Subjective testObjective testBoth had intention to conclude contractBut did the intentions meet?Unable to determine consensus ad idemBased on actions of partiesExamine documents exchangedNo consensus ad idem occurredQn 2.391d) Is the subjective test more or less desirable a test? ConclusionHyde v Wrench (1840)Subjective test is less desirable compared with objective test

Less clarityNo consideration of tangible evidenceQn 2.392end. questions?93