Chapter 5 Self-test questions

To whom may an offer be made.

Only a specified individual.

Only a single group of people specifically identified in the offer.

The entire world.

Only to persons over the age of 21.

A void contract has no legal effect and does not place obligations on the parties to the agreement.

True

False

________ contracts are those where one of the parties offers to do something in return for an action by the other party–they exchange promises. Each of the parties in this type of contract has an obligation to perform some action. For example, one person agrees to wash the other's car in return for having his/her lawn mowed.

A display in a shop window will generally be held to constitute what?

Always an offer.

It cannot be identified in advance as it depends upon the perceived intention of the seller.

An invitation to treat.

It has no legal significance.

Asking a tenant if they are interested in purchasing a house is simply requesting further information as part of a negotiation and does not amount to an offer to sell.

True

False

A _________ contract is one where the injured party has the option to affirm the contract (he/she can continue with the agreement and bring about an enforce- able contract) or he/she can avoid the contract (and the contract is terminated).

Acceptance is NOT effective if through:

Conduct only.

Express words (whether oral or written) only.

The offeree's non-communicated intention.

Conduct and/or express words.

Where A offers a house for sale to B for £1000 and B accepts and informs A that he will pay £950, A may refuse. If B then provides A with the £1000, a valid acceptance has taken place which establishes an enforceable contract.

True

False

The _______ is the party that establishes the terms of a contract by which he/she is willing to be bound.

Revocation of an offer is effective when:
i) It is posted.
ii) It is communicated to the offeree by the offeror.
iii) It is the intention of the offeror to revoke.
iv) It is communicated to the offeree by a reliable third party.

i only.

i and iii.

i, ii, and iii.

ii and iv.

The case Butler v Ex-Cell-O identified the 'first/last shot approach' adopted by the courts in determining the operative contract where both parties have used their own standard form contracts in the negotiations.

True

False

An _____ __ ______ is the term used when a party invites offers (essentially the party with the goods/services to trade invites offers which he/she is able to accept or decline).

Michelle contacts Hannah and asks her if she would be interested in purchasing her car for £2000. Hannah immediately takes £2000 to Michelle and says she wants to buy the car. Michelle subsequently does not wish to proceed. What is the consequence of the above scenario?

A contract was made when Hannah accepted Michelle's offer.

Michelle has the right to refuse before she takes possession of the cash.

As the value of the car is only £2000 the courts will not hear the case and no enforcement can be ordered.

There is no contract as Michelle only requested information and did not make an offer to sell.

As a general rule, where the offeror has not provided for any specific form that acceptance must take, silence may be a valid form of acceptance.

True

False

The case of _______ identified the 'first/last shot approach' to which contract will be the operational one where two businesses use standard form contracts.

Which of the following cases demonstrated that (in the absence of any specific deadline) for acceptance of an offer to be effective, it must be provided within a reasonable time.

Ramsgate Victoria Hotel v Montefiore (1865-66).

Gibson v Manchester CC [1979].

Blackpool and Fylde Aero Ltd v Blackpool BC [1990].

Harris v Nickerson (1872-73).

Acceptance by means of the post will always be valid on posting, not when it is received by the offeror.

True

False

In face to face contractual negotiations, an effective acceptance of an offer must be ___________ to the other party.

Where the post is a valid means of acceptance, at what point will the offeree have been held to have accepted the offer?

When the letter of acceptance has been written.

When the letter of acceptance has been correctly addressed, its postage paid, and posted.

When the letter of acceptance is received by the offeror.

When the letter of acceptance is opened and its contents read by the offeree.

When using instantaneous forms of communication, acceptance is effective when received, not when sent.

True

False

Felthouse v Bindley established the need for the offeree to positively communicate, and hence make an outward sign of, his/her __________ .

In relation to acceptance through instantaneous forms of communication, in which of the following locations have the courts held the contract as being formed?

The place where the offeree is based when deciding to accept the offer.

The place where the acceptance is sent.

The place where the acceptance is received.

The place where the parties choose to select.

Where the offeror has identified to the offeree that an offer will remain open for seven days, the offeror may not revoke the offer before this time has passed.

True

False

When the postal rule of acceptance is valid, acceptance is considered effective when ______.

Which of the following is NOT a recognised possible solution to problems posed by the so-called 'battle of the forms', when two contracting business organisations each claim that their terms apply?

The contract is made on the terms of the party whose form was put forward first (the 'first shot' approach').

The contract is made on the terms of the party whose form was put forward last (the 'last shot' approach)..

There is no contract at all, because the parties are not in agreement, and there is no matching offer and acceptance.

The contract is as yet incomplete, since the parties must re-negotiate the agreed terms of the contract in order for their dispute to be resolved fairly.

Cases involving traders displaying goods, advertisements, auctions, and negotiations are general examples of offers to sell.

True

False

When using __________ forms of communication, the 'postal rule' of acceptance is departed from and the traditional rules of communication of acceptance is used.

Which of the following would NOT constitute a valid acceptance by Peter of an offer made by Jane?

On Monday morning, Jane sends a letter to Peter offering to sell her Vauxhall Astra car to him for £1500. Peter receives the letter on Tuesday morning, and immediately writes back, telling Jane that he will buy the car for that price.

Jane telephones Peter, offering to buy Peter's valuable Persian rug. Peter says he will think about it. Later that day Peter telephones Jane, and tells her that he will be happy to sell the rug to her, and that the price is £500.

Jane sends a fax message to Peter, offering to sell him her antique dining table and six chairs for £2,000, and asking him to reply by fax by 5 pm the same day. Later that day, Peter sends Jane a fax message at 4.50 pm, saying that he is prepared to buy the furniture at that price.

Jane telephones Peter asking if he would like to purchase her car for £1000. Peter agrees to the purchase for a sum of £900.

A voidable contract is one where the injured party has the option to affirm the contract or they can avoid the contract.

True

False

The case Alexander Brogden v Metropolitan Railway demonstrated that acceptance of a contract need not be in writing or made orally, rather it could be evidenced through the ______ of the parties.

An advert is placed in a shop window offering a reward for anyone who will find and return a lost cat. This is an example of:

A bilateral contract.

A void contract.

A unilateral contract.

Not evidence of any type of agreement.

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