The document discusses the legal concepts of offer and acceptance. It defines an offer as a proposal made by one party to another to enter into a legally binding agreement. For an offer to be valid, it must be definite, unambiguous, and communicated to the offeree. An acceptance is the manifestation of assent by the offeree to the terms of the offer, creating a legally binding promise. For an acceptance to be valid, it must be absolute, within a reasonable time period, and communicated to the offeror. The document outlines the rules and legal requirements regarding offer, acceptance, revocation, and rejection.

1. Offer and
Acceptance

2. Offer
 An offer is a proposal made by one party to another to enter into a legally binding
agreement with him.
 A person is said to have made a proposal, when he ‘signifies to another his
willingness to do or to abstain from doing anything, with a view to abstaining the
assent of that other such act or abstinence {Sec.2(a)}.
 Offerer/Proposer/Promisor- a person making offer.
 Offeree/proposee- person to whom offer is made
 Offerer accepting the offer is acceptor/promisee{Sec.2©}
 Types of offer:
1. Express
2. Implied
3. Specific Offer-made to a specific person and accepted by him only.
4. General offer –to world at large
Chapter 15 2

3. What constitutes an offer
 An obvious intention on the part of the
offerer to be bound by it.
 Offer made with a view of obtaining the
assent of the offeree to such act or
abstinence
 Offer must be definite
 Must be communicated to the offeree.
Chapter 15 3

4. Legal rules as to an offer
 Offer must be such as in law is capable of being accepted and giving rise to legal
relationship
 Terms of offer must be definite, unambiguous and certain and not loose and vague
 An offer may be distinguished from :
i) A declaration of intention and an announcement
ii) An invitation to make an offer or do business
iii) A newspaper advertisement is not an offer
 Offer must be communicated
 Offer must be made with a view to obtaining the assent
 Offer should not contain a term the non-compliance of which be assumed to
amount to acceptance
 A statement of price is not an offer
 Tenders : A tender (in response to an invitation to offer) is an offer and may be
either :
a) a definite offer to supply specified goods or services ;or
b) a standing offer
 Cross offers are not acceptance of offer
Chapter 15 4

5. Acceptance
 It is the act of assenting by the offeree to an offer.
 It is the manifestation by the offeree of his willingness to
be bound by the terms of the offer.
 An offer when accepted becomes a promise {se.2(b)}
 Acceptance can be :
 Express
 Implied
 Who can accept an offer?
 Acceptance of a particular offer can be by the particular
person only
 Acceptance of a general offer to the world at large can
be accepted by any person to whom it is made
Chapter 15 5

6. Legal rules as to acceptance
 It must be absolute and unqualified {Sec7(1)}
 It must be communicated to the offerer
 It must be according to the mode prescribed or usual and
reasonable mode
 It must be given within a reasonable time
 It cannot precede an offer
 It must show an intention on the part of the acceptor to fulfill terms of
the promise
 It must be given by the party or parties to whom the offer is made
 It must be given before the offer lapses or before the offer is
withdrawn
 It cannot be implied from silence
 Agreement to agree in future is not a contract
Chapter 15 6

7. Communication of offer acceptance
and revocation
 Mode of communication (Sec3), may be communicated by words
spoken or written or by conduct
 When communication is complete (Sec4)
 When it comes to the knowledge of the person to whom it is made
 When communication is put in the course of transmission
 Communication of revocation means ‘taking back’, recalling or
withdrawal is complete when it comes to the knowledge to whom it
is made.
 Time for revocation of offer and acceptance (Sec5, para1)
 A proposal may be revoked at any time before the communication of
its acceptance is complete as against the proposer, but not
afterwards.
 Time for revocation of acceptance (Sec5, para2) : An acceptance
may be revoked at any time before communication of the
acceptance is complete as against the acceptor , but not afterwards.
Chapter 15 7

8. Communication of offer acceptance
and revocation contd.
 Loss of letter of acceptance :Acceptance is
complete against the offeror as soon as the
letter of acceptance is posted even if it goes
astray or lost. But it should be correctly
addressed , sufficiently stamped and posted.
 Contracts over telephone or telex or oral
communication have same effect as entered
face to face but properly received i.e. heard and
understood by the offeror.
Chapter 15 8

9. When an offer come to an end
 By revocation , lapse or rejection
 Sec.6 deals with various modes of revocation of offer as under :
1. By communication of notice of revocation by the offeror at any
time before its acceptance is complete as against him
2. By lapse of time if not accepted within the prescribed time
3. By non fulfillment by the offeree of a condition precedent to
acceptance
4. By death or insanity of the offeror provided the offeree comes
to know of it before acceptance
5. If a counter offer is made to it
6. If an offer is not accepted according to the prescribed or usual
mode
7. If the law is changed
Chapter 15 9

10. Rejection of an offer
 An offeree can reject the offer. Once rejected cannot
be subsequently accepted
 Rejection can be :
1. Express : By words spoken or written, but notice
of rejection must reach to the offeror
2. Implied : By Counter offer/Conditional
acceptance
Chapter 15 10

11. Q n A Session
 THANKS
Chapter 15 11