Question 1

If an offer and acceptance cannot be identified, there can never be a contract.

Accepted Answer

A contract can still exist through the conduct of the parties involved, even if a formal offer and acceptance cannot be clearly identified, as long as there is an agreement and consideration.

Question 2

Explain the difference between an offer and an invitation to treat.

Accepted Answer

In relation to an invitation to treat, the rules relating to offer and acceptance are varied. An invitation to treat is not an offer, but rather is an offer to consider offers. This is because the person making the statement does not intend their words or conduct to constitute an offer, such as in the case of advertisements. Other examples include auctions, catalogues, price lists and the like, automatic vending machines and ticket dispensing machines. In the case of an offer, the person making the offer does intend to be bound by the offer. In other words, if it is clear in the circumstances that a party intends their words or conduct to constitute an offer, such as in Carlill v Carbolic Smokeball, then the courts will construe it as an offer.

Question 3

In order to reach a legally enforceable agreement, the parties to an agreement:

Accepted Answer

A

Question 4

A promise to 'keep an offer open' for a specified period:

Accepted Answer

A promise to keep an offer open is not enforceable unless it is supported by consideration from the offeree, which makes it a binding option contract.

Question 5

Which of the following actions or conduct is NOT a requirement of a valid offer?

Accepted Answer

An offer does not necessarily need to be made to a specific offeree; it can be made to the public at large, such as in the case of a reward offer.

Question 6

Which of the following is NOT a requirement of a valid revocation of an offer?

Accepted Answer

A signature and date are not required for a valid revocation of an offer. The key requirements for a valid revocation are that it must take place prior to acceptance by the offeree, the offeree must be made aware of the revocation, and the offeror must give notice of the revocation to the offeree.

Question 7

In relation to contract law an invitation to treat is best described as:

Accepted Answer

An invitation to treat is an invitation for others to make offers. It is not an offer itself but an indication that a party is open to receiving offers.

Question 8

In Carlill v Carbolic Smoke Ball Co [1893] 1 QB 256, the advertisement placed by the company was:

Accepted Answer

The advertisement placed by the company in Carlill v Carbolic Smoke Ball Co [1893] 1 QB 256 was an offer. This was because the advertisement contained specific promises and conditions, such as a promise to pay £100 if the "smoke ball" did not prevent influenza, and a condition that the user must follow the instructions provided. These elements suggest that the company was making a definite promise to any person who bought and used the product according to the instructions.

Question 9

An offer may be made to the world at large.

Accepted Answer

An offer may be made to the world at large, meaning it is open to anyone who meets the conditions of the offer. This is known as a unilateral contract.

Question 10

Which of the following situations is likely to be seen as an offer rather than as a mere invitation to treat?

Accepted Answer

An email containing a question like 'Can I buy your copy of Business Law for $50?' is likely to be seen as an offer because it shows a clear intention to be bound by the acceptance of the proposal, which is a key characteristic of an offer in contract law.

Question 11

When goods are sold by tender, the offer is accepted and the contract is formed:

Accepted Answer

In a tender process, the contract is formed according to the terms specified in the invitation to tender, which usually state that the contract is formed when the seller accepts the tenderer's offer.

Question 12

In order to be contractually binding on the parties, an agreement:

Accepted Answer

An agreement can arise by implication as a result of the conduct of the parties, meaning that the actions of the parties can indicate that they have entered into a binding agreement. While it is always advisable to have a written contract signed by both parties, it is not always necessary for an agreement to be binding. Verbal agreements can also be enforceable in certain circumstances.

Question 13

The offeror is the person making the offer.

Accepted Answer

The offeror is the person who initiates the offer and makes it to the offeree.

Question 14

An offer is NOT terminated by:

Accepted Answer

A request for more information by the offeree does not terminate an offer. The offeror is simply being asked to provide more details before an acceptance can be made. A counter-offer, a rejection of the offer, and a qualified acceptance by the offeree can all terminate the original offer.

Question 15

If an agreement is made between two parties of unequal bargaining power:

Accepted Answer

When an agreement is made between two parties of unequal bargaining power, the court will not enforce the agreement if the stronger party used unconscionable pressure. Unconscionable pressure refers to the use of undue influence, fraud, or the exploitation of a weak or vulnerable party. Therefore, option C is the best choice.

Question 16

In respect to a purported contract an offer made to a person is ineffective if:

Accepted Answer

For an offer to be effective, it must be brought to the notice of the person to whom it is directed. If the offer is not communicated or brought to the notice of the intended person, then it cannot be considered a valid offer. Therefore, option B is the correct answer. Options A, C, and D are not entirely accurate as an offer made to a group of people without specifying who in the group can accept the offer, or making it to the whole world and not in writing can still be legally binding if certain conditions are met, such as acceptance by the intended person.

Question 17

What is the purpose of an option?

Accepted Answer

The answer of What is the purpose of an option?...

Question 18

It is important to identify when parties have reached agreement because:

Accepted Answer

All of the options listed are valid reasons why it's important to identify when parties have reached agreement. A contract can come into existence once agreement is reached, the terms and conditions agreed to create legally enforceable rights, and identifying the time and place of the contract can be important for legal purposes.

Question 19

The decision in the case of Pharmaceutical Society of Great Britain v Boots Cash Chemist (Southern) Limited [1953] 1 QB 401 means that when a customer shops at a supermarket, the offer is accepted and the contract is formed:

Accepted Answer

The decision in Pharmaceutical Society of Great Britain v Boots Cash Chemist established that the display of goods on shelves is considered an invitation to treat, rather than an offer. It is the customer who makes the offer to buy the goods by presenting them at the checkout for purchase, and the supermarket then accepts this offer by completing the transaction and taking payment. Therefore, the contract is formed at the checkout when the supermarket accepts the customer's offer to buy the goods.

Question 20

Breach of an agreement which is NOT actually a contract:

Accepted Answer

Even though the agreement is not a contract, breaching the terms of the agreement may still violate consumer protection legislation, which can result in legal consequences. However, it will not lead to an action for breach of contract or criminal penalty, as there is no binding contract in place.

Quiz 8: Agreement Between the Parties