Business Law Questions: Offer and Acceptance

Question 1

Advanced Novelty Advertisers Ltd is a family business which retails a wide range of consumer products with unusual design features. The business is conducted partly by mail order and partly from “The Curiosity Shop”.

This week the Company advertised in the local newspapers a “Special Offer of Novelty Animal Telephones - £79 down to £39”.

Explain the legal implications of the following situations:

a)   Naomi Drone wrote to the Company’s mail order office stating “I accept your offer to sell a Dring Dring Duck for £39 and request you to reserve one for collection.”

b)   What if Naomi sent a cheque with the request?

c)    When the Company received the letter on Wednesday it wrote back the same day stating “The advertised price was incorrect. For £39 read £59”.  Does Naomi have any redress?

d)   The following day the Company posted another letter stating “Despite yesterday’s letter (which please ignore) your Dring Dring Duck is available at £39 and we are holding it for you”. Does Naomi have a valid contract?

Howard Glugg found the shop closed when he was on his way home one night so he put an envelope through the letterbox with a cheque for £39 and a note saying “Herewith payment for one Novelty Animal Telephone which I shall collect on Saturday unless you call me on 222772 to say it is not available...”  Next day the envelope was placed in a pending tray and subsequently overlooked - and by Saturday all Novelty Animal Telephone had been sold to other customers.

Howard now argues that the Company has broken a contract and that his acceptance of the Company’s “Special Offer” created a binding agreement which the Company has failed to fulfil. Advise Howard.

Question 2

George decides to sell his car and so he advertises it in the Hull Daily Mail at £3000. John reads the advertisement and telephones George. When told the mileage of the car John says that whilst he is interested in the vehicle he does not think that it is worth more than £2,500. George rejects this proposal. On speaking to a friend, John realises that because George’s car has the distinctive registration GEO 123 it is worth more than the asking price.

John telephones George but the line is engaged, so John writes to George as follows:   

“Having reconsidered the matter I am willing to pay your asking price for the car and I will call at your home at 10 am tomorrow morning with £3000 in cash.”

John sends the letter by first class post and it is delivered to George’s home at 8.15 am the next morning. In the meantime, another buyer has bought the car for £2,750.

Advise John

Question 3

Jennifer runs an off-licence and receives a letter from some wine merchants with whom she has done business before. The letter says “As one of our valued customers we would like to offer you a very fine consignment of French wine. We only have 50 bottles available at a price of £250. We are prepared to keep this offer open for you to consider for the next 5 days. If you would like to accept our offer then please send notice in writing to our head office”

Jennifer posts her acceptance to the company immediately. 3 days later she meets her friend Maggie, who also owns an off-licence. Maggie tells her about receiving the same letter from the wine merchants and states that she faxed her acceptance of the offer yesterday. Jennifer’s letter is delayed in the post due to a strike and doesn’t arrive for 7 days

Advise Jennifer and Maggie.

Question 4

The display of goods in a shop window, the display of goods on the shelves of a self-service supermarket, an advertisement that an auction sale will be held at a particular time and place, and an advertisement that certain goods are for sale: none of these are offers to sell goods. Why not? And is Carlill really any different?

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