Offer Termination Methods

A) Lapse of time

An offer lapses if it is not accepted within a stipulated time. In other words, if an offer opens for a specified time, it will close at the end of that time. For example, ‘A’ offered to sell a car to ‘B’ and the offer lasted for 10 days. After 10 days, ‘B’ is not allowed to accept the offer anymore. However, if no time has been stipulated, the offer will close after a reasonable time. In Barrick v Clark, ‘A’ offered to buy land from ‘B’, then ‘B’ sent a counter-offer to ‘A’ and asked ‘A’ to reply as soon as possible. But ‘A’ accepted the offer out of the reasonable time, so ‘B’ can reject A’s acceptance due to the offer having expired.

B) Revocation

An offer can be revoked at any time before its acceptance and the revocation become effective when it comes to the knowledge of the offeree. In Byrne v Van Tienhoven, Van Tienhoven posted a letter to Byrne offering tinplates for sale, but then had sent another letter withdrawing their offer before Byrne received the first offer. The withdrawal of the offer was ineffective since the offeree has not been communicated. Besides, the offeror need not notice the revocation to offeree personally, it can be done through a reliable third party. In Dickinson v Dodds, ‘A’ after offering to sell his property to ‘B’, then sold it to ‘C’. Thereafter, ‘B’ was informed of sale by ‘D’. ‘A’ had validly withdrawn the offer and notice ‘B’ via ‘D’.

On the other hand, if someone makes an offer to the public, the offer can be withdrawn when offeror notice the revocation to the public. In Shuey v United States, ‘A’ offered a reward to public and then revoked it. ‘B’ met the requirement for the reward after the revocation of offer. Therefore, the offer had validly revoked and ‘B’ cannot get the reward.

C) Conditional offer

An offer may be bounded by some conditions that it will be terminated if particular event happen. If someone wants to accept an offer, he/she must meet the condition which may be express or implied. In Re Reitzel v Rej-Cap Manufacturing Ltd, ‘A’ offered to sell a estate to ‘B’, then the estate destroyed by fire and thereafter, ‘B’ accepted the offer immediately in order to collect the insurance for the estate as well as the estate itself. However, the contract cannot formed due to the subject-matter of the offer is changed. It is because the offer only included sale of land and a building, But not for land and its insurance claim.

D) Rejection

There are two forms to reject the offer. First, the offeree may reject the offer with communicate to offeror. Then the offer is destroyed and thereafter, the offeree cannot accept it. Besides, the offeree is merely requiring information does not mean he/she reject the offer,2 in other words, the offeror cannot close the offer. For instance, Peter promise to sell his car to Mary and she required some further information. But then Peter sells his car to John and Mary accepts the offer before the deadline. Mary can sue Peter since she does not reject the offer. In Stevenson v Mclean,3 Mclean (offeror) offered to sell iron to Stevenson (offeree). Stevenson telegraphed Mclean that whether the iron could be paid for over two months. Mclean ignored the telegram and sold the iron to someone else. Then Stevenson accepts the offer before the deadline but Mclean refused to deliver the iron. Stevenson can sue Mclean since he just required information and does not reject the offer.

Counter-offer is other form of rejection of offer. The offeree introduces a new offer to offeror and the counter-offer kills the original offer which is no longer be accepted.4 After making a counter-offer, the original offeree becomes offeror and the original offeror becomes offeree. In Hyde v Wrench,5 Wrench offered to sell an estate to Hyde for 1000 pounds; Hyde replied that he can pay 950 pounds for purchase. Hyde’s response was a counter-offer.

E) Death of a party

When the offeror died, the contract can still arise validly if offeree unaware of the offeror’s death and the contractual obligations can be performed by his/her personal representatives. Yet, the offeree cannot accept the offer after knows of the offeror’s death. In Fong v. Cili, Cili and ‘A’ want to buy Fong’s land, but Fong died before ‘A’ signed the contract. Then ‘A’ signed the contract after knows Fong’s death. In this case, the contract cannot be formed because knowing the offeror’s death amount to a communication of revocation of offer. But in some case, the offer does not be terminated after offeror died.

When offeree died, the offer has not been terminated unless the facts show that the offer still can be accepted by a specific third party. In Carter v Hyde, although Hyde died, his executors can accept the offer the deadline. The offer was not intended to be one that was personal to Hyde and therefore, it could be accepted by his executors.

F) Acceptance

Acceptance means the offeree accept the offer and agree all the term of the offer. The offer can only be accepted by offeree and the offer has brought to an end after acceptance of offer. In Brogden v Metropolitan Railway Co, Brogden signed the contract and then sent it to Metro. In this case, the offer accepted by Brogden and brought to an end after the contract has been signed.