Law the contract. The offerer may demand a

Law for Accounting

Contract law is,
essentially, the imperative necessity in binding a legal agreement between two
or more parties on the basis of a mutual understanding within terms and
conditions of a written or verbal contract. The validity of a contract must
include key factors in order for it to qualify: an acceptance, consideration
(an invitation to treat) and the intent to go through with creating legal
relations. An offeror is typically the party of which presents an offer to an
offeree, one to whom an offer is made and  has the right to accept or reject the

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                           An acceptance occurs
when the offeree expressly accepts the offer made by the offeror. To illustrate
the general rule to the case of acceptance is that it must involve
effective communication between the two parties or authorization given to a
third party on their behalf to accept.  An
acceptance can be valid to be accepted orally, via a telephone, or written in
forms of a letter or an email depending on the level of formality of the
contract. The offerer may demand a particular method of communication for the
offeree to accept but a clear acceptance must be made. In the case of Entores Ltd vs Miles Far East Corp- Denning LJ, delivered the leading judgment. He said that the
postal rule could not apply to instantaneous communications, such as telephone
or telex: if a phoneline “went dead” just before the offeree said
“yes”, it would be absurd to assume that the contract was formed and
the parties would not have to call each other back. Lord
Denning  LJ (1955, p.97)  explained “suppose for instance, that I shout
an offer to a man across a river or a courtyard but I do not hear his reply
because it is drowned by an aircraft flying overhead. There is no contract at
that moment. If he wishes to make a contract, he must wait until the aircraft
is gone and then shout back his acceptance so that I can hear what he says. Not
until I have his answer am I bound.”  – It
must be brought to the attention of the offeror when an offer is being

the method of communication is being requested via postal services, the general
rule states that the acceptance is valid from the moment the letter of
acceptance has been posted, regardless of delays, or incidences of lost, stolen
or damaged packages resulting in a failed delivery to the offeror. In the case
of ‘Adams v Lindsell (1818)’, it
establishes the postal rule which states a letter with a correct address, along
with the correct postage stamp, is classified as an acceptance. This is known
as ‘rule of convenience’, (Duxbury, 2015) and suggests that in the request of a
postal acceptance, as an offeror; all risks associated with the form of
communication must be apprehended beforehand

            An invitation to treat
is an expression of willingness to negotiate which is not to represent an offer
and/or cannot accept as a form to bind a contract. The
courts take an objective approach in deciding whether a statement was an offer
or an invitation to treat. It is essential to understand the difference between
the two; when accepting an offer it automatically signs you up into the binding
contract, whereas an invitation to treat is the introduction to making an
offer. Invitations are some form of an advertisement in a way that it initiates
an invitation to bid or bargain for an item (or service), with these conditions
set, of course, however no party is obliged to continue with the sell or buy.


To complete a contract,
aforementioned, one party must make an offer and the second party must accept
the offer. In the case of Pharmaceutical
Society of Great Britain v Boots (1953), the Poison Act 1933 was introduced.
The case explained: all prescribed drugs must be purchased under the
supervision of a qualified pharmacist, (Br Med J 1950;2:455). The arguments in this case,
defendants were being prosecuted due to a pharmacist not being present at the
time of selecting the pharmaceuticals from the shelf. Firstly, the displaying
of goods on the shelves was an invitation to offer without the supervision of
the pharmacist. What constitutes as an offer here was presenting the goods at
the cash register had the intention to purchase the goods, and communicated so.
The contract is accepted the moment the pharmacist accepts the customer’s offer
by taking the cash in exchange for the product. In terms of acceptance
analysis, the goods were displayed being an invitation, therefore the movement
of cash from the customer to the cashier is the offer, and is complete when
payment is taken and processed which implies acceptance.

The same analogy applies
in Fisher v Bell (1961) the lawsuit
where a ‘flick knife’ item was advertised for sale in the shop window and the display
of the product was decided that it was an invitation to treat. Any consumer whom
wished to enter the shop with the intentions of purchasing the knife at the
priced indicated in the shop window. The display was a mere invitation; meaning
that there were no forms of agreement hence no offence being performed,
(Tillotson and Mulcahy, 2004). A bilateral contract is known to have an outstanding
obligation remaining on both sides of the party which an offeror makes a
promise in return for a future bargain from the offeree. The case Partridge
v Crittenden (1968) exhibits
the rule of advertisements for its understanding known as an invitation to
treat. This advertisement was found in the section for classified advertisement
and there was no evidence of the phrases for sale on view.