OFFER
The term offer is also referred to as proposal. It is defined
under Section 2(a) CA 1950 as:
Definition
“When one person signifies to another his willingness to do or to abstain from doing anything, with a view to obtaining the
assent of that other person to the act or abstinence, he is said to make a proposal.”
To whom can an offer be made to?
A. INDIVIDUAL
B. A CLASS OF PERSONS
C. PUBLIC AT LARGE
Offer - Designated offeree
Invitation to treat (ITT) - Inviting others to make an offer - Eg. Advertisement/ Auction/ Display/ Internet/ Self-service counter
Communication of an Offer
The communication of a proposal is complete when it comes to the knowledge of the person to whom it is made.
Revocation of an Offer
If a proposer wishes to revoke his proposal, he has to satisfy Section 5(1) of the CA 1950, which provides:
Provision “A proposal may be revoked at any time before the communication of its acceptance is complete as against the proposer, but not afterwards.”
When is a communication of acceptance complete against the proposer? If it is an acceptance under the instantaneous principle, that is by telephone, telex, orally or by facsimile, an acceptance is deemed communicated as soon as it reaches the proposer.
A proposal therefore can be revoked at any time before the promisee accepts. It differs for an acceptance by post. Section 4(2) states that communication of an acceptance is complete against both parties(the proposer and the promisee) at different times. If you refer to Section 4(2)(a) of the CA 1950, you will find that a proposer binds himself to the contract as soon as the promisee puts the letter of acceptance into the postbox even if the proposer does not know of the acceptance. The proposer therefore cannot revoke his proposal because the letter of acceptance is already in the postbox.
Four ways in which revocation of an offer are made :
A. By the communication of notice of revocation by the proposer to the other party.
B. By the lapse of the time prescribed in the proposal for its acceptance, or, if no time is prescribed, by the lapse of a reasonable time, without communication of the acceptance.
C. By the failure of the acceptor to fulfil a condition precedent to acceptance.
D. By the death or mental disorder of the proposer, if the fact of his death or mental disorder comes to the knowledge of the acceptor before acceptance.