OFFER/PROPOSAL. S.2(a) of the Contract Act 1950 provides that: When one person signifies to another his willingness to do or to abstain from doing anything, with a view to obtaining the assent of that other to the act or abstinence, he is said to make a proposal.
The communication of the proposal is complete when it comes to the knowledge of the person to whom it is made.
“I’ll pay you RM50 to design a backdrop for our Open Day”
This is not an offer to sell but an invitation for customers to make an offer to buy.
PARTRIDGE v CRITTENDEN 
PAYNE v CAVE 
-Df made the highest bid (offer) at an auction sale but withdrew his bid before the fall of the auctioneer’s hammer (acceptance).
-Df was not bound to purchase the goods.
HARRIS v NICKERSON 
-Advertisement a forthcoming auction sale does not amount to an offer to hold it.
HARVEY v FARCEY 
H sent telegram to F: Will u sell us
Bumper Hall Pen? Telegraph lowest
H telegraphed his response: We agree
to buy BHP for £900 asked by u.
Held: there was no contract
“when a person to whom the proposal is made signifies his assert thereto, the proposal is said to be accepted, a proposal when accepted becomes a promise.”
The acceptance must be made on exactly
the same terms as proposed without
modifications or variations.
Any modifications or variations of the
proposal does not constitute an acceptance
but amounts to a counter-offer. It is treated
as a rejection of the offer.
June 6-defendant offered to sell his estate to the Plaintiff for 1,000.
June 8–plaintiff replied stating he was willing to buy at 950, defendant refused to sell.
June 27 –plaintiff wrote again offering to pay 1,000 as there was no contract formed.
By making the counter offer the plaintiff had rejected the original offer on June 8, and is no longer able to accept it later.
HELD: there is no counter-offer but a mere inquiry which should have been answered and not treated as a rejection of the offer.
it often happen that acceptance may be qualified by such common term as” subject to contract” or “subject to a formal contract being drawn up by our solicitors.” Under such circumstances the court is inclined to determine that there is no binding agreement until the contract as stipulated
LOW KAR YIT v MOHD ISA 
“ be expressed in some usual and reasonablemanner, unless the proposal prescribes a manner in which it is to be accepted. If the proposal prescribes a manner in which it is to be accepted, and the acceptance is not made in such manner, the proposer may within a reasonable time after the acceptance is communicated to him, insist that his proposal shall be accepted in the prescribed manner, and not otherwise, but if he fails to do so, he accepts the acceptance.”
FELTHOUSE v BINDLEY 
“If I hear no more about him, I shall consider the horse is mine at £30.”
( comes to the actual knowledge of the proposer)
Exception: S.4(2) CA, where the parties have contemplated the used of the post as means of communication :ACCEPTANCE THROUGH POST
As against A, when the letter is posted;
As against B, when the letter is received
Denning LJ stated as follows:
“ when a contract is made by post it is clear law throughout the common law countries that acceptance is complete as soon as the letter is put into the post box, and that is the place where the contract is made.”
The House of Lords affirmed the rule with
Respect to communications by telex established
in the Entores case. According to the court no
universal rule can cover all such cases and they
must be resolved by reference to the intentions
of the parties, by sound business practice and in
some instances, by a judgement where the risks
“A proposal may be revoked at any time
before the communication of its
acceptance is complete as against the
proposer, but not afterwards.”
The Df offered to sell 1,000 boxes of tinplates to the Pf.
The following communication took place:
Oct 1 and sent acceptance by telegram the same day. It also followed up with letter of acceptance on 15 Oct.
There was a contract between the parties
because the revocation of the offer posted
on 8 October was not effective till 20
October when it was received by the Pf but
in the meantime, the latter had already
accepted the offer on 11 October when the
telegram was sent.
“ An acceptance may be revoked at any time before the communication of the acceptance is complete as against the acceptor, but not afterwards.”
made by post: