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  • Essay / Rules on the formation of contracts - 1111

    For a contract to be concluded, there are various requirements. It is the offer, acceptance, consideration and intention to create legal relations. A contract can also be terminated. There are two types of offers: specific and general. Specific offers are those made by a person or group of people who can choose to accept, and general offers are made by a generalized majority, such as in awards and public advertisements. In the case of CARLILL v CARBOLIC SMOKE BALL, a general offer had been made, as it was a high-profile advertisement. The company did not respect the conditions it had set; the court therefore ruled that the contract had been breached because an offer had been made. It was rightly decided that most offers required verbal or written acceptance. This requirement was not present in the case of WILKIE v LONDON PASSENGER TRANSPORT BOARD, as it was not clear how and where the contract was made for the bus journey. In this case it would appear that it may be necessary for verbal or written acceptance to be mandatory in the formation of any contract, but this may prove difficult. In FISHER v BELL, it was necessary to decide whether an offer had been made or whether it was an invitation to treat. This comes before the offer. In this case it was decided that no offer had been made, as generally store window displays are not offers. This was later confirmed in the case of MELLA v MONAHAN. Problems can arise when deciding whether or not an offer has been made, as in the case of GIBSON v MANCHESTER CITY COUNCIL, but generally the courts work with effective rules to produce effective results. Once an offer has been made, the next step in forming a contract is a... middle of paper ...... with the verdict of the contract still intact as the death has not affected the contract, because the link was not personal. It is also possible for an offer to be withdrawn at any time before acceptance. This rule can lead to complications, as was the case in ERRINGTON v ERRINGTON, where a withdrawal occurred while the couple was in the process of agreeing. However, the courts were able to reach a reasonable verdict by holding that once the couple finished paying the deposits, the house was theirs, because the acceptance was a continuing act. In the event of non-compliance with a condition precedent, the offer is no longer likely to be accepted, as in the case of FINANCINGS LTD v STIMSON. From the above evidence it would appear that although some complications may arise in some cases, when looking at the formation of contracts the rules provided generally produce accurate results.