Offer in Contract

Offer in Contract. An offer is a definite statement or proposition made by one party (the offeror) to another party (the offeree) which contains the terms upon which he; the offeror is willing and ready to enter into a contract with the offeree.

Offer is one of the elements of a valid contract. Very often what one party regards as a clear-cut case of offer or acceptance is firmly rejected by the other party who claims that it is something else. Hence, related factors like invitation to treat, counter-offers, cross-offers, conditional acceptances, “provisional agreements, acceptance in ignorance of offer, have all developed together with the study of what constitutes an offer and acceptance respectively.

Indeed, at least in Nigeria, the parties in most cases do not conclude clear-cut agreements and it is left to the court in such cases to construe from the correspondence and conduct of the parties whether there is a contract, and if so what the exact term of the contract are. See the celebrated case of David Ejinyi V. Amusa Adio (1993)7NWLR(pt.305)320.C.A

Definition of an offer in law of contract –

For a contract to exist there has to be an offer, by one party to another and an acceptance by the person to whom the offer is addressed.
An offer may be defined as a definite proposal or promise made by one party with the intention that it shall become binding on the party making it as soon as it is accepted by the party to whom it is addressed.

An offer must be precise and unequivocal leaving no room for speculation or conjecture as to its real content in the mind of the offeree. The offeror must place at the doorsteps of the offeree, a clear intention and desire to enter into a contract with the offeree on clearly defined terms. The person making the offer is known as the offeror, while the person to whom it is addressed to is known as the offeree.

Thus, all situations involving the sale of goods and property must also involve offer and acceptance. Indeed, the routine activities daily performed by most human beings are contractual in nature and can be analyzed into situations of offer and acceptance. Illustrations abound. The house wife who goes to the local market makes offers for all the various items of food she wants to buy, and the seller accepts in each case before there is exchange of money for goods. The student who enters a bookshop goes through a similar though not an identical process.

However, there are a few cases in which the courts have made a finding that there is a contract even though it is difficult to analyze the transaction in terms of offer and acceptance. See the case of New Zealand Shipping Company V. M.M. Satterth Waite & Co. Ltd (1974)1ALL E.R 1015 at 1020, reported in England, United Kingdom.

By its very nature, there is no limit to the number of people an offer can be made to. But bear it in mind that a contract comes into existence only between the offeror and the person or persons responding to the offer and accepting it.

This principle, was first declared in the famous English case of Carlill V. carbolic Smoke Ball Co by Bowen, L.J., (1893)1Queens Bench 256; is now expressed by stating that an offer can be made not only to an individual or a group of persons, but also to the whole world. In that case, the defendants had argued that no contract could arise from advertisement because you cannot make a contract with the whole world. This argument the court rejected by stating as follows:

“it was also said that the contract is made with the whole world-that is, with everybody; and that you cannot contract with every body. It is not a contract made with all the world. That is the fallacy of the argument. It is an offer made to all the world; and why shouldn’t an offer be made to all the world which is to ripen into a contract with anybody who comes forward and performs the condition? It is an offer to become liable to anyone who, before it is retracted, performs the condition, and although the offer is made to the world. The contract is made with that limited portion of the public who come forward and perform the condition on the faith of the advertisement.

See also the land mark judgment of the English Court of Appeal sitting in England, Brogden V. Metropolitan Railway Co. (1877)2 A. C. 666; Nigerian National Supply Company Ltd. (NNSC) V. Agricor Incorporation of USA (1994) 3 NWLR (pt.332)p.339 C.A.

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