In contract law, an offer is a fundamental concept that students must understand thoroughly. Here’s a detailed explanation tailored for Hong Kong students preparing for their exams:
Definition:
An offer is a clear expression of willingness to enter into a contract on specific terms, made with the intention that it will become binding as soon as it is accepted by the person to whom it is addressed.
Key Points to Remember:
(1) Clear Expression of Willingness:
- The offeror (the person making the offer) must clearly indicate their intention to be bound by the terms of the offer.
- The terms must be specific and definite, leaving no room for ambiguity.
(2) Specific Terms:
- The offer must outline the essential terms of the contract, such as price, quantity, and subject matter.
- Vague or incomplete terms may render the offer invalid.
(3) Intention to Create Legal Relations:
- The offeror must intend for the offer to be legally binding once accepted.
- This intention is judged objectively, based on how a reasonable person would interpret the offer.
(4) Communication to the Offeree:
- The offer must be communicated to the offeree (the person to whom the offer is made).
- The offeree must be aware of the offer to accept it.
Examples and Case Law:
- Carlill v. Carbolic Smoke Ball Co. (1893): This case illustrates a clear offer made to the public. The company advertised that it would pay £100 to anyone who used their product and still contracted influenza. The court held that this advertisement constituted a valid offer, as it was specific and showed an intention to be bound.
- CA1996 Case: A university offered a teaching position to an individual, who accepted it based on the university’s terms. Later, the university claimed it was a mistake and refused to honor the contract. The court ruled that a binding contract was formed when the offer was accepted, despite the university’s mistake.
Exam Tip
When answering questions about offers, always identify whether the communication in question meets the criteria of a clear expression of willingness, specific terms, and intention to create legal relations. Use case law to support your arguments and demonstrate your understanding of how these principles are applied in real-life scenarios.
By mastering the definition and characteristics of an offer, you’ll be well-prepared to tackle exam questions on this topic. Good luck with your studies! 📚