lecture-03 - LESSON 3: ACCEPTANCE Learning Outcomes After...

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Learning Outcomes After todays class you should be able to answer the following questions: •The meaning of offer and acceptance •The communication of offer and acceptance •The revocation of offer and acceptance Introduction By now you must be aware of the essentials of a contract. In today’s lecture we shall do a detailed study of the concept of offer The four basic elements of a contract are offer, acceptance, consideration and contractual capacity out of which we shall study the first one in this lesson. While discussing the essential elements of a valid contract in the preceding chapter we observed that as a first step in the making of a contract there must be a ‘lawful offer’ by one party and a ‘lawful acceptance’ of the offer by the other party, thus where A, offers to sell a wrist watch to B for Rs. 200 and B accepts the offer, a contract comes into being provided other essentials of a valid contract like that of competency of parties to contract, etc. are present. We propose to discuss now the legal rules relating to a ‘lawful offer’. The Proposal or Offer The words ‘ proposal’ and ‘offer’ are synonymous and are used interchangeably. Section 2 (a) of the Indian contract act defines a ‘proposal’ as, “ when one person signifies to another his willingness to do or to abstain form doing anything, with a view to obtaining the assent of that other to such act or abstinence, he is said to make a proposal”. This definition reveals the following three essentials of a ‘proposal’. (i) One person signifies to another; it must be an expression of the willingness to do or to abstain from doing something. According to section 3 to signify means that the proposal must be communicated to the other party. (ii) The expression of willingness to do or to abstain form doing some thing must be to another person. There can be no ‘proposal’ by a person to himself (iii) The expression of willingness to do or to abstain from doing some-thing must be made with a view to obtaining the assent of the other person to such act or abstinence. Thus a casual enquiry “ do you intend to sell your motorcycle?” is not a ‘proposal’. Similarly, a mere statement of intention” I may sell my motorcycle if I can get Rs. 14,000 for it” is not a ‘proposal’. But if M says to N, “ will you buy my motorcycle fro Rs. 14,000,” or “ I am willing to sell my motorcycle to you for Rs. 14,000”, we have a ‘proposal’ as it has been made with the object of obtaining the assent of N. The person making the ‘proposal’ or ‘offer’ is called the ‘promisor’ or ‘ offeror’, the person to whom the offer is made is called the ‘offeree’, and the person accepting the offer is called the ‘promisee’ or ‘acceptor’. Legal Rules Regarding a Valid Offer
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This note was uploaded on 09/27/2011 for the course BUS 100 taught by Professor Sherry during the Spring '11 term at Faculty of English Commerce Ain Shams University.

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lecture-03 - LESSON 3: ACCEPTANCE Learning Outcomes After...

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