Rules for Offer and Acceptance
Rules of Offer and Acceptance are applied to enforce an agreement by the law. This agreement is the first requisite of any contract of the business. In order to a contract come into being between parties, the offer is made by the offeror and the oferee accept that offer. In 21st century, there are rapid changes in business trend which create lots of new business model such as e-business and global business. The more business participates, the more requirements of Offer and Acceptance Rules to adapt to the change. In this essay, we are going to look at the Rules of Offer and Acceptance, how do they affect business contract and whether these rules make good business sense in 21st century or not.
Offer And Acceptance, How These …show more content…
When there is a reserve price, no contract will be formed with lower price; but if there is no reserve price, the property must sell to the highest bid however low the bid might be. In aspect of tender, at common law, an invitation to tenders is normally not an offer, unless the two exceptional situations occur: inviter accepts the most competitive offer or inviter consider tenders which conform to the bid conditions (Poole, 2008). Finally, for Sales of Shares, if a company makes an statement to the public for selling their shares, this statement cannot be consider as a offer because it just invites members to apply for the shares and this company can decide how many shares to issue. However, in case of right issue, the letter informing the shareholder of his rights amount to a offer (Treitel, 2003).
We are now moving to analyse when offer is terminated. To begin with, if an offer is accepted, that offer is no longer available for acceptance. Secondly, an offer can end if it is rejected. There are three main ways to reject an offer: the offeror is notice that the offeree does not want to accept the offer, or the offeree wish to accept the offer subject to certain conditions, or the offeree makes a counter-offer (Keenan & Riches, 2007). Nevertheless, asking for further information which does not reject the offer must be distinguished from counter-offer (Poole, 2008). Thirdly, an