LWZ118 Lecture Notes - Lecture 2: Westpac, Tinn, Australia National Netball Team
Lecture 2
Contracts
ACCEPTANCE
Acceptance brings about the necessary meeting of the minds – consensus ad idem – to form an agreement.
The notion of the meeting of the minds ‘is practically the foundation of English law upon the subject of
formation of contracts’.
Household Fire & Accident Insurance Company (Limited) v Grant (1879) LR 4 Ex D 216 at 220 per Thesiger
LJ.
Rules of Acceptance:
ACCEPTANCE MUST BE UNEQUIVOCAL; (nothing left to be negotiated by the parties)
MUST BE IN RELIANCE UPON THE OFFER; In R v Clarke (1927) 40 CLR 227 at 231, The WA Government
offered a reward of £1000 for information leading to conviction of murderers of 2 policemen and
suggested that a pardon might be available to any accomplice not being a person to have actually
committed the murder. Clarke and T were arrested in connection with one of the killings. Clarke made a
statement and gave evidence, after which T and one other were convicted for that murder. Nobody was
charged with the other murder. Clarke later claimed the reward for the first time. The High Court held,
‘”when giving the information, Clarke did not act "in reliance upon the offer or with the intention of
entering into any contract". While the convictions would not have come about without his evidence, and
so the Crown obtained what it wanted, Clarke gave the information solely to clear himself.”
Acceptance must correspond with the offer – Should not be a counter-offer if:
It does not affect offer in original form
The deviation solely favours party A (offeror)
It only introduces terms that would reasonably follow the agreement
It does not coincide exactly with terms of offer due to error or mis-description by Party B (offerree) when
acceptance is made. See Carter v Hyde (1923) 33 CLR 115
ACCEPTANCE CAN BE EXPRESS OR IMPLIED –
Most acceptances are by means of an express statement made by Party B Party A.
General Rule: An offeror cannot stipulate that no response to an offer will be treated as an
acceptance – Felthouse v Bindley (1862) 142 ER 1037. Thus, just because the offeree is silent doesn’t mean
that he has accepted the offer.
Exceptions: Party B may be under an obligation to respond with a rejection. The rule does not apply
where:
A case in equitable estoppel can be raised against Party B (the offeree); and / or The conduct of
Party B amounts to an implication that he or she has accepted the contract. Where the parties have been
conducting business for long and dealings are carried on as a matter of course, there Party B is under an
obligation to specifically reject the offer.
May be possible to infer existence of contract and its terms based on the conduct of the parties:
The Bell Group Ltd (in liq) v Westpac Banking Corp (No 9) (2008) 225 FLR 1 at 314.
Character and circumstances of conduct must indicate unambiguously that there is an intention to
contract.
Must be able to point to existence of the contract on the terms alleged.
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