Illustrate the Rules Regarding an Offer

1. Definition of an Offer

• An offer is a clear proposal made by one party (the offeror) to another party (the offeree) to form a contract under specified terms.
• It must express the willingness to enter into a contract and must be capable of acceptance.

2. Intention to Create Legal Relations

• The offeror must intend for the proposal to be legally binding if accepted.
• Example: Casual statements, jokes, or invitations to negotiate do not count as valid offers.

3. Offer Must Be Clear and Definite

• An offer must include clear terms and conditions.
• Vagueness or uncertainty in the proposal can invalidate the offer.
• Example: Saying “I might sell you my car if I feel like it” is not a valid offer.

4. Communication of the Offer

• An offer must be communicated to the offeree. It cannot be accepted without knowledge of its existence.
• Communication can be:
  • Oral
  • Written
  • Implied by conduct
• Example: If A places a reward notice for a lost item but B returns it without knowing about the reward, B cannot claim the reward.

5. Types of Offers

1. Express Offer: Directly stated in words (oral or written).
2. Implied Offer: Derived from conduct or circumstances.
3. Specific Offer: Made to a particular person or group.
4. General Offer: Made to the public at large (e.g., reward for a lost item).

6. Offer Must Not Be a Mere Invitation to Treat

• An invitation to treat is an invitation to negotiate or make an offer, but it is not an offer itself.
  • Examples:
    • Price tags on goods (invitation to buy, not an offer).
    • Auction advertisements.
    • Catalogs, brochures, or shop displays.

7. Offer Can Be Revoked Before Acceptance

• An offer can be revoked (withdrawn) at any time before it is accepted.
• However, revocation must be communicated to the offeree.

8. Termination of an Offer

An offer comes to an end in the following cases:

1. Revocation by the offeror before acceptance.
2. Rejection by the offeree.
3. Counter-offer: If the offeree proposes changes to the original offer.
4. Lapse of Time: If the offer specifies a time period, it expires when the period ends.
5. Death of the offeror or offeree before acceptance.
6. Failure of a Condition: If a condition precedent to the offer is not fulfilled.

9. Acceptance Must Mirror the Offer (Mirror Image Rule)

• The offeree must accept the offer exactly as it is presented.
• Any variation or modification is treated as a counter-offer, not acceptance.

Example to Illustrate the Rules

• A offers to sell his car to B for $5,000.
  • If B agrees to pay $5,000, the offer is accepted, and a contract is formed.
  • If B says, “I’ll buy it for $4,500,” this is a counter-offer, which voids the original offer.
  • If A withdraws the offer before B accepts, there is no contract.