Unformatted text preview: okseller sends a
catalogue of books indicating prices of various books to
many persons. This catalogue is not an offer to sell
those books at prices indicated against those books.
This is an ‘Invitation to treat.’ If any person is interested
in purchasing those books mentioned in the catalogue
he may make an offer. Similarly, inviting persons to an
auction where goods, which are to be auctioned, are
displayed is not an offer for the sale of goods. The
intending buyers, who make the bid make an offer. Such
an offer, when accepted, by the fall of hammer or in
some other customary way, will result in a contract.
some Intention to create legal relationship In order that an offer, after acceptance, can result in a
valid contract it is necessary that the offer should be
made with an intention to create legal relationship.
Promise in the case of a social engagements is generally
without an intention to create legal relationship, such an
agreement cannot be considered to be a contract. Thus
an agreement to go for a walk, to go to movie, to play
some game, or entertain another person with a dinner,
cannot be enforced in a court of law. Sometimes the
party may expressly mention that it is not a formal or
legal agreement, whereas in some other cases such an
intention could be presumed from their agreement.
intention The test to know the intention of the parties is objective
and not subjective.
Merely because the promisor
contends that there was no intention to create obligation
would not exempt him from liability
would In Rose and Frank Co. Vs. Crompton &
Brothers Ltd. the agreement between the
parties provided ;
“ This arrangement is not entered into ……….
as a formal or legal jurisdiction in the Law
Courts……. that it (the agreement) will be
carried through by parties with mutual loyalty
and friendly co-operation.”
One of the parties made a breach of this
agreement. In an action by the other party to
enforce the agreement, it was held that since the
agreement had provided that it was not a formal
or legal agreement the same was not
enforceable.. In the case of Meritt Vs. Meritt, (1970) the
husband and wife were the joint owners of a
building which was subject to a mortgage to a
The husband left the
matrimonial home to live with another woman.
At that time, at the insistence of the wife, the
husband signed a note saying that the wife will
pay all outstanding amounts in respect of the
house and in return “I will agree to transfer the
property into your sole ownership”. It was
held that in this case it was clear that the parties
intended to create legal relationship and,
therefore, the husband was bound by the
contract Communication of offer
Communication An offer when accepted results in a contract.
An offer can be accepted only after the same
has come to the knowledge of the offeree. It
means that the offer has to be communicated to...
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- Fall '13
- Government, thehouse, Meritt