OFFER AND ACCEPTANCE- MEANING , ELEMENTS AND LEGAL RULES

Offer and acceptance - meaning of offer and acceptance , elements and mere/mental acceptance and legal rules for an offer and acceptance.

1. PREPARED BY : KHUSHI GOYAL OFFER AND ACCEPTANCE

2. LEARNING OBJECTIVES Meaning of an offer or proposal Elements of an offer Legal rules for a proposal or offer Meaning of an acceptance Legal rules for an acceptance

3. MEANING OF AN OFFER OR PROPOSAL In an agreement , one party makes a proposal and the other party gives acceptance to it . According to section 2 “the person making the proposal is called promiser and the person accepting the proposal is called promisee . The british refer to it as an “offer” but in Indian Contract , it is called a proposal.

4. ELEMENTS OF AN OFFER Existence of two parties. Choice to do or not to do (abstain). There must an intension to create an offer. The invitation of an offer should be made. Intension to make a legal obligation.

5. LEGAL RULES FOR A PROPOSAL OR OFFER. The offer must be made to create a legal obligation. The terms of the offer must be unambiguous and definite. For eg : a car is offered for Rs 5lakhs .it should not like a car is offered for Rs 4-5lakhs. The offer may be general or specific. It means a offer may be for an individual person or may be for public. The offer may be expressed or implied. It may be expressed orally ,written or through actions .

6. Continued... The offer should be a request not an order. The offer must be for possible act. No offer can be given for any act that cannot be happen in actual. The offer must be communicated. Promisor must communicate the offer so that it can come in everyone’s knowledge .

7. MEANING OF AN ACCEPTANCE As per section 2 (b) the person to whom the offer is made gives his assent , the offer is said to be accepted. A proposal when accepted becomes a promise.

8. LEGAL RULES FOR AN ACCEPTANCE Acceptance must be absolute and unconditional: As per section 7 an acceptance must be absolute and condition free. For eg : if A offered bike to B for Rs 50,000 and B replies that he will accept this offer if the value of offer reduced to Rs 40,000 . Then this acceptance is no acceptance. Acceptance must be to an offer : An acceptance should be a response to an offer. One cannot accept what is not offered to him.

9. CONTINUED… Acceptance must be made in the mode prescribed : If any mode of acceptance is prescribed in the proposal it shall be accepted in the manner prescribed. Acceptance must be given within a specified time : Acceptance to an offer must be given within the time specified in the proposal but if no time specified acceptance must be given within a reasonable time. Acceptance may be expressed or implied: Expressed acceptance may be in written or oral and implied acceptance can be given through actions .

10. MENTAL ACCEPTANCE IS NO ACCEPTANCE Mental acceptance is which is not expressed in words or in writing is not recognised as acceptance from the legal point of view . Acceptance should be something more than mental acceptance . In other words, there must not only be a desire to accept , but the desire must be expressed in words – oral or written .