Question 1

Not all offers must be communicated to the offeror for a valid contract to arise.Explain.

Accepted Answer

As a general rule,when a person makes an offer,the acceptance of the offer must be communicated to the offeror before a contract can arise.This is the general rule where a bilateral contract is concerned.That is a contract where both parties make promises to each other.In a unilateral contract,however,where one party makes a promise to whomever steps forward to accept the contract,the acceptance of the contract does not have to be communicated before a valid contract arises.For instance,if Jack says,"I'll pay $1000 to anyone who finds and returns my cat," all that is required is for Jim to find and return the cat and Jack will be obliged to pay the $1000.Jim does not have to notify Jack that he,Jim,intends to look for the cat.

Question 2

Awab has an opportunity to attend a Toronto Raptors playoff game but he needs to sell one of his laptop computers in order to raise funds.The game is Sunday so he offers to sell the laptop to a co-worker Julie advising her that he will accept $400 for the laptop so he can attend the game on the weekend.Julie tells him she will "let him know".Awab did not sell the laptop before the game and therefore did not attend.The following Monday (the day after the game)Julie tells Awab she accepts the offer and will pay the $400.Julie's position that the offer was open for acceptance on Monday is

Accepted Answer

A) correct because there was no time specified in Awab's offer. 
B) correct because the offer was never revoked by Awab. 
C) correct because it is reasonable that an offer of this nature be left open for longer than "a few days". 
D) incorrect because the offer is open for a reasonable time and given the communication by Awab of "other circumstances" indicating urgency,the offer was open until the game. 
E) incorrect because Awab did not attend the game. 
A) correct because there was no time specified in Awab's offer. 
B) correct because the offer was never revoked by Awab. 
C) correct because it is reasonable that an offer of this nature be left open for longer than "a few days". 
D) incorrect because the offer is open for a reasonable time and given the communication by Awab of "other circumstances" indicating urgency,the offer was open until the game. 
E) incorrect because Awab did not attend the game. D

Question 3

Explain how the rule concerning withdrawal of an offer by post differs from that concerning the time of acceptance by post.

Accepted Answer

When the post is used to accept an offer,the general rule is that acceptance is complete when a properly addressed and stamped letter of acceptance is dropped in the mail.Regarding the withdrawal of an offer by post,the general rule is that the offer is revoked by post when the offeree actually receives notification of the revocation and not when it is dropped in the mail.

Question 4

Advertisements to sell goods at certain prices are generally mere invitations to the public to visit the place of business.A business is not expected to sell the goods to everyone who reads its advertisement.If an appliance store advertises a smart TV in the newspaper for the mistaken amount of "$33" instead of "$333",the position of the customer who removes the TV from the shelf and takes it to the cashier and says "I accept" will be met with the following legal argument

Accepted Answer

A) it is the customer's offer to purchase the TV for $33 which will not be accepted by the store. 
B) the mistake is a mistake caused by the newspaper and any loss to the store will have to be paid back by the newspaper. 
C) the mistake is the store's mistake and not the customers and the acceptance by the customer will be enforced. 
D) there can be no contract in circumstances where a mutual mistake occurs and as such there is no enforceable contract. 
E) the customer's acceptance would be based on an implied term that newspaper advertisements (even if mistaken)need to be enforced. 
A) it is the customer's offer to purchase the TV for $33 which will not be accepted by the store. 
B) the mistake is a mistake caused by the newspaper and any loss to the store will have to be paid back by the newspaper. 
C) the mistake is the store's mistake and not the customers and the acceptance by the customer will be enforced. 
D) there can be no contract in circumstances where a mutual mistake occurs and as such there is no enforceable contract. 
E) the customer's acceptance would be based on an implied term that newspaper advertisements (even if mistaken)need to be enforced.

Question 5

Briefly differentiate between the two key legal relationships,that being contract and tort,having regard to legal obligations.

Accepted Answer

Contracts are voluntary legal relationsh

Question 6

When an offer is proposed to an interested party,the form of acceptance does not matter even if a preferred method of communication is stipulated within the offer.

Accepted Answer

A) True 
 B)False

Question 7

Explain the difference between an invitation to do business and an offer.

Accepted Answer

An offer to make a contract can be accep

Question 8

An acceptance must always be communicated to the offeror for a valid contract to arise.

Accepted Answer

A) True 
 B)False

Question 9

What is a counter-offer? What effect does a counter-offer have on an offer?

Accepted Answer

A counter-offer is made when an offeree

Question 10

An acceptance of an offer must be

Accepted Answer

A) made slowly. 
B) loud and clear. 
C) by conduct only. 
D) positive. 
E) in writing only. 
A) made slowly. 
B) loud and clear. 
C) by conduct only. 
D) positive. 
E) in writing only.

Question 11

When the offeror specifically states in the contract that acceptance can be given by performing an act,direct verbal communication of acceptance is not needed to make the contract binding.

Accepted Answer

A) True 
 B)False

Question 12

In the Carlill v.Carbolic Smoke Ball case,the court found that a newspaper advertisement impliedly waived the requirement that formal notice of acceptance be communicated.Performance of the condition set out was sufficient acceptance without separately notifying the company.In addition to this finding,what else did the Carlill case establish?

Accepted Answer

The case established that an o

Question 13

Why should you not make an agreement to sell your car to a purchaser "for a fair price"?

Accepted Answer

Although the courts have a policy of mak

Question 14

An invitation to do business is a commitment to enter into a contract upon acceptance.

Accepted Answer

A) True 
 B)False

Question 15

Joe sees a dog wandering around his yard.He lets the dog in.Later he learns that the dog belongs to Mary,a woman who lives a kilometre away.Joe returns the dog to her the next day.A few days later as Joe is riding his bike,he sees an old advert in which Mary offers to pay $100 to any person who will find and return her dog.Joe realizes that he should have claimed the reward at the time that he returned the dog to Mary,and he decides to go to Mary's place.Which of the following is TRUE?

Accepted Answer

A) Joe will be entitled to the reward because he found the dog and returned it. 
B) Joe will not be entitled to the reward because Mary made no offer. 
C) Joe will not be entitled to the reward because he did not see the offer of the reward until he had returned the dog and so he did not act in response to the offer of Mary. 
D) Mary's advert is an invitation to do business and cannot give rise to a contract. 
E) Joe will be entitled to the reward because Mary made an offer and his act of finding and returning the dog is an acceptance. 
A) Joe will be entitled to the reward because he found the dog and returned it. 
B) Joe will not be entitled to the reward because Mary made no offer. 
C) Joe will not be entitled to the reward because he did not see the offer of the reward until he had returned the dog and so he did not act in response to the offer of Mary. 
D) Mary's advert is an invitation to do business and cannot give rise to a contract. 
E) Joe will be entitled to the reward because Mary made an offer and his act of finding and returning the dog is an acceptance.

Question 16

Goods displayed on shelves in a store constitute an offer.

Accepted Answer

A) True 
 B)False

Question 17

Mary places a notice in a local variety store.The notice reads as follows: "I shall pay $1000 for the return of my dog,Mundo." Jim sees the notice.Jim finds the dog and returns it to her.Which of the following is TRUE?

Accepted Answer

A) Mary can refuse to pay Jim because Jim did not communicate his acceptance of the offer to Mary,and an acceptance must be communicated to the offeree. 
B) The notice is an invitation to treat and could not give rise to a contract. 
C) Mary makes a counteroffer. 
D) Mary is obliged to pay Jim because by finding the dog,he accepted the contract and no notification was needed. 
E) When Jim finds the dog,he makes the offer and it is up to Mary to determine whether she wishes to accept the offer.Mary is thus entitled to reject the offer. 
A) Mary can refuse to pay Jim because Jim did not communicate his acceptance of the offer to Mary,and an acceptance must be communicated to the offeree. 
B) The notice is an invitation to treat and could not give rise to a contract. 
C) Mary makes a counteroffer. 
D) Mary is obliged to pay Jim because by finding the dog,he accepted the contract and no notification was needed. 
E) When Jim finds the dog,he makes the offer and it is up to Mary to determine whether she wishes to accept the offer.Mary is thus entitled to reject the offer.

Question 18

A standing offer is

Accepted Answer

A) one that may be accepted from time to time as needed. 
B) one that can be revoked even after acceptance. 
C) an offer that is made and withdrawn before it is accepted. 
D) one that is said to stand because it is fixed and cannot be changed. 
E) one that cannot be revoked after acceptance without the consent of the offeree. 
A) one that may be accepted from time to time as needed. 
B) one that can be revoked even after acceptance. 
C) an offer that is made and withdrawn before it is accepted. 
D) one that is said to stand because it is fixed and cannot be changed. 
E) one that cannot be revoked after acceptance without the consent of the offeree.

Question 19

Mary goes into a store in which she sees a SALE sign.While she is looking round,she notices that a sign that says 50 percent off has been placed against a pair of knee-high boots.She takes the pair of boots to the cashier.The cashier refuses to sell the boot at the 50 percent discount.Which of the following is TRUE?

Accepted Answer

A) The cashier is in breach of contract. 
B) Mary is not entitled to a 50 percent discount because the sign was not an offer. 
C) The conduct of the store amounts to false advertising and Mary will be entitled to the 50 percent discount. 
D) Mary is entitled to a 50 percent discount because that boots were advertized as being sold at a discount of 50 percent. 
E) The store is in breach of contract. 
A) The cashier is in breach of contract. 
B) Mary is not entitled to a 50 percent discount because the sign was not an offer. 
C) The conduct of the store amounts to false advertising and Mary will be entitled to the 50 percent discount. 
D) Mary is entitled to a 50 percent discount because that boots were advertized as being sold at a discount of 50 percent. 
E) The store is in breach of contract.

Question 20

An offer may be revoked before it is accepted.To be valid,a revocation must be

Accepted Answer

A) promised. 
B) communicated to the offeree before acceptance. 
C) subject to a condition. 
D) loud and clear. 
E) exclusive. 
A) promised. 
B) communicated to the offeree before acceptance. 
C) subject to a condition. 
D) loud and clear. 
E) exclusive.

Exam 6: Formation of a Contract: Offer and Acceptance

Not all offers must be communicated to the offeror for a valid contract to arise.Explain.

Explain how the rule concerning withdrawal of an offer by post differs from that concerning the time of acceptance by post.

Briefly differentiate between the two key legal relationships,that being contract and tort,having regard to legal obligations.

When an offer is proposed to an interested party,the form of acceptance does not matter even if a preferred method of communication is stipulated within the offer.

Explain the difference between an invitation to do business and an offer.

An acceptance must always be communicated to the offeror for a valid contract to arise.

What is a counter-offer? What effect does a counter-offer have on an offer?

An acceptance of an offer must be

When the offeror specifically states in the contract that acceptance can be given by performing an act,direct verbal communication of acceptance is not needed to make the contract binding.

Why should you not make an agreement to sell your car to a purchaser "for a fair price"?

An invitation to do business is a commitment to enter into a contract upon acceptance.

Goods displayed on shelves in a store constitute an offer.

Mary places a notice in a local variety store.The notice reads as follows: "I shall pay $1000 for the return of my dog,Mundo." Jim sees the notice.Jim finds the dog and returns it to her.Which of the following is TRUE?

A standing offer is

An offer may be revoked before it is accepted.To be valid,a revocation must be

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