Chen-Wishart: Contract Law 2e 
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Diagrams from the textbookChen-Wishart: Contract Law 2e
Chapter 3
1. 'The distinction between an offer and an invitation to treat is based on the intention of the party making the communication.' To what extent is this true?
See 3.2.
First, 'intention' must be qualified by objectivity.
Second, the importance of manifest intention to be bound by an acceptance (the general test of an offer) can be illustrated by contrasting the outcomes of the Gibson case and the Storer case.
However, and third, this is qualified, e.g. by:
Rules of convention in different contexts such as displays, advertisements and auctions. How can these be justified?
Judicial manipulation of the rules to reach results perceived to be fair. Give examples and explain.
2. Using examples, explain the requirements of a valid acceptance.
See 3.3.
Remember to give depth to your answer by also justifying the requirements.
3. How does, and how should, the law deal with problems arising from the 'battle of forms'?
See 3.3.1.3.
What is the 'battle of forms' problem?
How does the law currently deal with the problem?
What are the pros and cons of the current approach?
What alternatives have been, or may be, suggested (e.g. Lord Denning in Butler or from the Principles of European Contract Law)?
What is your preference and why?
4. When does, and when should, the postal acceptance rule apply?
See 3.3.4.
First, describe the law on when the postal acceptance rule applies. Remember that it doesn't apply just because the post is used.
Second, is the normative question, when should the postal acceptance rule apply.
What is to be said in support of the rule? Assess these; are they convincing?
What problems attach to the rule?
How does the rule apply to new developments in methods of communication such as the email and text messaging?
State your conclusion on the appropriate status of the postal acceptance rule. What would you advise if asked by the Law Commission?
5. 'The search for coherent principles in uncertainty cases is a "fool's errand"; courts cure uncertainty if they think it desirable'. Discuss.
See 3.6
This is an open question inviting you to discuss the judicial attitude and approach to problems of uncertainty in contract formation. The quotation suggests an absence of coherent principles in this area. Do you agree?
What are the techniques available to courts to cure uncertainty? How are they applied (what policies influence courts in this exercise)?
What latitude or discretion is available to the courts?
Is there a measure of predictability to the way particular problems are likely to be resolved by the courts?
6. Are agreements to negotiate, or not to negotiate, enforceable? Should they be?
See 3.6.2.5.
What is the current law on the enforceability of agreements to negotiate, and agreements not to negotiate?
What is the justification for the current law? Are they convincing? Are they consistent with other legal principles?
Are there good reasons for adopting other conclusions? You may want to return to this question after reading the section on good faith at 9.5.
7. 'The requirement of "intention to create legal relations" is a misnomer.' Discuss.
See 3.7.
To what extent is the requirement of intention to create legal relations aimed at identifying and giving effect to the parties' intentions?
To what extent is it aimed at giving effect to other policies (if so, what)? What presumptions operate in this area and how may they be rebutted? Relate your answers to the quote.
How does this requirement relate to the test of an offer and an acceptance (both of which require the offeror and the offeree to intend to be legally bound)?
It would also add another dimension to relate the issue to that of the test for enforceability (discussed in chapter 4); in particular, the suitability of replacing consideration with a test of intention.
8. 'It is a mistake to think that all contracts can be analysed into the form of offer and acceptance' (Lord Denning). How is and how should contract formation be determined? Can the mirror image approach be improved?
See 3.1 and 3.5.
This question invites you to give an assessment of the offer and acceptance (mirror image) approach to contract formation. The sub-questions you should address are:What are the advantages of the offer and acceptance approach?
What are the draw-backs? To what extent is the quotation correct (give examples of cases that do not easily fit into an offer and acceptance analysis)? To what extent is backward-reasoning a problem? Note that 'uncertainty' is just another way of describing 'flexibility'.
What alternative/s have been suggested? What are the pros and cons of the alternative/s?
What is your conclusion on the question posed?
9. 'While the rules on contract formation purport to be an elaboration of the requirements of establishing consensus between the parties, an analysis of the rules themselves and their application suggests that other facts also play a role'. Discuss.
See 3.5, especially 3.5.2.
The overarching question is the extent to which the rules of contract formation relate to identifying and giving effect to the parties' intention and the extent it gives effect to other factors. The sub-questions you should address are:
What are the rules of contract formation? Go beyond the obvious ones relating to offer and acceptance (e.g. two-contract analysis, battle of forms, objectivity, certainty, intention).
To what extent does each of these rules, as applied, seek to give effect to the parties' actual intention? To what extent does each relate to other (identify them) policies (e.g. certainty, fair dealing, protection of weaker parties, avoidance of unfair terms).
10. Conan offers to sell his computer for £300 'first come, first served, email me or fax me'. Dan sends the first response by e-mail. Eve faxes her response a few hours later saying 'would you accept £250?' Conan sees the fax first, then reads his e-mails but fails to see Dan's e-mail because of a fault. Conan faxes back to Eve 'Yours for £280 unless I hear otherwise within 24 hours'. Two days later he checks his e-mail to find Dan's message. Advise Conan.
What does Conan want? Assuming both Dan and Eve allege an enforceable contract, Conan cannot fulfil both and would seek to argue that there was no contract with either Dan or Eve.
Is Conan's first communication an offer? Explain your answer.
Re Dan: Conan does not know of Dan's purported acceptance until two days after it is sent. When does Dan's communication of acceptance take effect? When it is sent, when Conan actually receives it or some other time? The answer depends on:
The applicability of the postal acceptance rule on which there are arguments both ways. What do you think is the likely outcome?
The issue of who should bear the risk for the miscommunication which is the fault of neither party.
What is your conclusion on whether Conan is liable to Dan?
Re Eve: Whether there is a contract with Eve depends on whether Eve can accept Conan's counter-offer by silence. What are the arguments for and against? Which do you think is the better argument? What is your conclusion on whether Conan is liable to Eve?
Note that it is possible for Conan to be liable to both Dan and Eve. Conan cannot specifically perform both but he can certainly be liable in damages.
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