1. What is an ‘invitation to treat’?

An invitation to treat is, when a business organization or an individual makes an offer to sell
their any products, are not always bound in law to accept the first offer made. An ‘invitation
to treat’ is a term that explains a situation of an option that individual or business
organization holds themselves open to offer that they can accept or reject (Dransfield, 2003).

An invitation to treat is a preliminary step in negotiations where one party invites other to make
an offer. It is not a binding offer but an invitation for others to initiate a contract.

For example, when a company opens a job vacancy, it is an invitation to treat, then when
agreeing their job conditions and apply to the job with expected salary and benefits is an
offer that company holds a right whether to accept or reject our offer.
Goods displayed to sell in a trade fair, supermarket or in a shop are offer to treat which might
have clearly mentioned terms and conditions.
One party is giving other to opportunity to make offer. For example super market products, the
consumer they decide whether to buy or not. The invitation to offer is not legally binding.

2. Farmers, a large department store, advertises ’50 Genuine NZ possum coats for sale!
$250 each for the first 12 people at the shop at 9 am tomorrow. Jess camps at the store
overnight, and when the shop opens, she presents her credit card with one of the coats
to the shop assistant. The assistant ignores her and sells the coats to the following 12
people who are behind Jess in the queue. Is there an enforceable contract in this case?

As we discuss in question no. 1, the advertisement is likely an invitation to treat not an offer
however the farmer’s advertisement is very specific with the condition that 12 people who
arrived at store at 9, Jess was one of that who actually there earlier than other people which
shows her immense interest on buying the product and when the shop opened she presented
her credit card to sales person to make an offer and presenting credit card shows her
capacity to buy a product. Here, Jess met required conditions of the advertisement.

In this case, Farmers' advertisement is quite specific: "50 Genuine NZ possum coats for sale!
$250 each for the first 12 people at the shop at 9 am tomorrow." This specificity, especially
the "first 12 people" clause, suggests a potential unilateral offer. A unilateral offer is an offer
that is accepted by performing a specific act. In this case, the act is being one of the first 12
people at the shop at 9 am.

On the case of Daulia vs four-mills Bank nominees (1978) CH 231:

Facts: the parties were negotiating over the sale of some properties. The seller promised the
buyer, that if the buyer produced a signed contract plus a bankers’s draft by 10 am the next
morning, the seller would go through with the contract. When the buyer complied with his
requirement the seller refused to go ahead.
Held: The court of Appeal held in favour of the seller because of the lack of writing in relation
to what was in effect a contract for the sale of land, but indicated that otherwise there would
have been a unilateral contract (Devenney, 2017)

On the case of Chapelton v Barry UDC [1940]

Facts: The claimant hired a deck chair from Barry UDC for use on the beach. There was a
notice on the beach next to the deck chairs stating that the deck chairs could be hired at 2d
for three hours and also 'respectfully requested' the public to obtain tickets issued by the
chair attendants. The claimant obtained a ticket and put it in his pocket without reading it. In
fact there was an exclusion clause printed on the ticket excluding the council's liability for
personal injury caused in using the deck chair. The claimant was injured when he sat on the
 chair. The fabric of the deck chair split away from the frame. He brought an action against
the council and they sought to rely on the exclusion clause contained in the ticket.

Held: The exclusion clause was not incorporated into the contract. A reasonable person would
regard the ticket as nothing more than a receipt and would not expect it to contain
contractual terms. Furthermore, the wording of the notice suggested that a person could
obtain the deck chair and get a ticket later. The notice constituted an offer and collecting the
chair would amount to acceptance. It would not be open to the council to introduce new
terms after the contract had been formed (Devenney, 2017)

Based on the above case scenario, even if there’s no enforceable contract, Jess could have
grounds to challenge the store’s behaviour under consumer protection laws (depending on
jurisdiction), or under breaching human right act because there is no valid reasons given to
her why they reject to sell her a coat especially when she meet both clause in the
advertisement.

3. Peter is standing at the bar next to Paul. Peter says to Paul; I will sell you my car for
$10,000. Paul replies I will think about it. Jack, who was standing next to Paul, says I
will give you $10,000 for your car? Is there an enforceable contract in this case?

There is no enforceable contract in this case, Peter offers Paul to sell his car for $10,000, which
is a clear offer however Paul’s answer is neither acceptance nor rejection to Peter’s offer. On
the other side, Jack came into the front and shows expression to accept the peter’s offer but
Peter did not answer to his offer, so here, neither Paul accepted Peter’s offer nor Peter accept
Jack’s offer.

The conversation between them did not enter to the contractual bound. Since Peter fails to
reply to Jack’s offer, his silence doesnot operate as an acceptance because:
 Peter hasn’t taken any benefit from offer
 The offeree did not notify the offeror if he does not intend to accept.
 The offerer has not stated or given the offeree reason to undersatnad that assent may
be manifested by silence or inaction and the offeree in remaining silent and inactive
intends to accept the offer (Scott Robert E)
Robert Dransfield writes in his book “Business Law Made Easy” that to constitutes a legal offer
there should be a four key rule of acceptance:
 Acceptance can only be made by the person to whom the offer is made: For e.g If A offer to
sell a book in discount only to B, B is the only person that can accept or reject the offer. So
its not the offer made to everyone.
 Offer must be absolute and unqualified: it means the offeree cannot add extra term and
condition (that requires a new offer). Altering the term and condition is referred to as
counter offer it would then be up to the offeror to make a new offer and have it accepted for
acceptance to be absolute and unqualified.
 Acceptance has to be communicated to the offeror: this could be by written or word of
mouth. However the court may deem that acceptance is implied by the conduct of the
acceptor.
 Acceptance must be in the mode set out in the offer : For example an advertisement might
ask for an order to be made in writing (Dransfield, 2003).

References
Devenney, J. &. (2017). Text, Cases and materials on contract law (Fourth ed.). London &

Newyork: Routledge Taylor and Francis Group.

Dransfield, R. (2003). Business Law Made Easy.

Scott Robert E, a. J. (n.d.). Contract Law and theory (Vol. Secondary material). Virginia: The

Michie Company.