BetterLawNotes-5 (2)

CONTRACT LAW

Offer and Acceptance Problem Question 1

Bert wants to trade in his current car and buy a newer model. On Saturday, he takes his car to Sid’s showroom. Bert expresses an interest in a particular car on Sid’s forecourt. After some preliminary negotiations, Sid tells Bert that the price for the new car is £10,000 and that he will allow a trade-in value of £1,000 for Bert’s current car. This would leave Bert with a balance to pay of £9,000. As part of the deal, Sid says he will throw in a year’s free servicing and insurance cover. Bert tells Sid that he thinks that they may be wasting each other’s time and leaves.

On Tuesday, Sid, anxious about his sales target, writes to Bert. Sid says that he will give Bert £2,000 for his current car, leaving a balance to pay for the new car of £8,000. Sid adds that this revised offer does not include free servicing or insurance cover. Bert receives and reads the letter the following day.

On Thursday, Sid reaches his sales target by selling a car to Ted. Sid immediately posts a letter to Bert, saying that his revised offer is no longer open for acceptance. On the same day, Bert decides that he will buy the car from Sid after all. He posts a letter to Sid saying that he accepts Sid’s first offer, with its balance to pay of £9,000 and free servicing and insurance cover. Bert writes that he will call into the showroom the next day to drop off his current car, pay the balance, and take delivery of the new car. 

The following morning as Bert is leaving his house for Sid’s showroom, the postman delivers Sid’s letter. Bert does not stop to open it. A few minutes later, another postman delivers Bert’s letter to Sid. Sid reads the letter immediately. On his way to the showroom, Bert is involved in a collision with another vehicle. Bert’s car sustains damage which will cost £1,500 to repair. Despite the damage, Bert continues to drive to Sid’s garage. Having parked his car on the forecourt, Bert enters the showroom, puts the keys and £9,000 in cash on Sid’s desk, and asks for the keys to his new car.

Advise Sid.

You cannot copy content of this page