Seller Ltd ("Seller?) is a manufacturer and seller of lifting equipment. Buyer Ltd, ("Buyer?), provides heavy goods vehicle servicing. On 1 July 2006 Buyer requested a copy of Seller's brochure and this was sent by post and received by Buyer on 3 July 2006. Tom, a representative of Buyer called thge Seller and was put through to Max, Seller's Sales Director. Tom told Max that Buyer wished to purchase the "Hercules? hydraulic jack system which was specially designed to lift heavy goods vehicles and was priced in the brochure at £28,000. Max thanked Tom for his order and agreed that the Hercules maching would be manufactured and delivered to Buyer on 31 August 2006 at the listed price of £28,000.
[...] Only once there is valid acceptance, properly communicated, will the offer be turned into an agreement. When the parties communicate using an instantaneous form of communication, like telephone, there is usually not much confusion as to whether the acceptance was received by the offeror. However the matching acceptance element is the greatest problem in practice. Indeed, whenever the terms of the original offer are altered, it becomes a fresh offer, i.e. a counter-offer. A counter-offer has the effect of extinguishing the original offer[4]. [...]
[...] This means that breach of the time stipulation will prima facie entitle the injured party to repudiate the contract. Whether the failure to perform the stipulation is “trivial and causes little or no prejudice to the injured party” does not prima facie make a difference[18]. In Union Eagle Ltd v Golden Achievement Ltd (1997), the Privy Council gave relief to the Plaintiff against a delay of only ten minutes in performing the time stipulation. In the present case, Seller has delivered the Hercules five days later. [...]
[...] When it is not like presently, Treitel emphasises that it “depends primarily on the intention with which it was made[3]”. It may be that Tom's statement merely purported to confirm the information presented in the brochure with the view of eventually making an offer, however it seems more likely that a reasonable person would think he intended to bind Buyer legally into the purchase of the Hercules. Accordingly, this appears to constitute a valid offer from Buyer. All that is required to create the contract is an unequivocal acceptance from Seller. [...]
[...] It is now up to Buyer to accept the counter-offer so that a contract of sale may exist. Seller's counter-offer requires Buyer to communicate his acceptance by submitting the order in Seller's standard order form. Where an offeror prescribes a compulsory method of acceptance, the offeree must comply exactly otherwise the acceptance will be held invalid[6]. Here, Tom completed the order form as was required by Seller. If at this stage Tom had sent the form only to Seller, he would most likely seem to assent to Seller's offer and this may have constituted an acceptance. [...]
[...] In this case, one set of terms contained a price variation clause and the other set did not. Consequently, when a dispute arose as to the price of the goods, the Court effectively applied the rules of offer and acceptance to find the answer. Similarly, in the present case, Buyer and Seller each rely on their own set of standard terms, one of which contains a price escalation clause while the other does not. Seller may be entitled to claim the remaining balance of £2,800 if the contract was made on its terms thus incorporating the price escalation clause. [...]
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