Multiple choice

Fact: D sent an offer to a firm with whom he had accounts. P who had just taken over the said firm got the letter addressed to the old firm, accepted the offer and sent the goods. P sued for the price of the goods. The court held that there was no contract since the order was to the held firm and the acceptance was by the new firm. An offer may also be made to the world at large, as the instance by an advertisement in the newspaper. In such a case only person or persons with notice of the offer can come forward and accept the offer. Issue: Are the claims of P genuine?

  1. D is liable for all the claims made by P because D was an old customer of the firm.

  2. As there is no contract between P and D so no liability.

  3. The contract is voidable at the option of D.
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

D's offer was made to the old firm, not to P who had just taken over. P is a different legal entity. An offer must be accepted by the same person to whom it was made. Since P was not the offeree, there could be no valid acceptance and no contract.

Keep practicing — related questions