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Rescind an offer or revocation of the offer, In any kind of relationship or business, in various situations, peoples are receiving and awarding offers. But after offering people might change their mind. So they might want to rescind an offer or revoke an offer. So let us explain to you how this can happen. Before that below explains how acceptance of an offer works.
Why acceptance of an offer is essential to bind a contract?
The term ‘contract’ is not a rare word in the world. When the relevant party accepts the offer, a ‘contract’ will be created. To have such a contract among participants, it needs some special requirements too. Among them, a valid offer and acceptance are more important.
Offer is an expression of eagerness to enter a statement that includes terms and conditions which will bind both participating parties after the acceptance by the relevant person. On the other hand, acceptance is like a promise to be bound with the presented terms and conditions included in the offer.
Here, we talk about the ways that bring an offer to an end. Revocation of offer can happen due to any of below cases.
Rejection of offer
This is the simplest way that an offer can revoke or rescind. The offeree has the right to refuse the offer. In other words, when he or she does not accept an offer, it is called rejection. If an offeree rejects the offer then automatically revoke the offer.
Revocation of offer before acceptance
Revocation of an offer, is a withdrawal of an offer by an offeror. So, there is a chance to Rescind an offer, but it must be done before the acceptance. There is an essential factor to pay attention here. After a revocation, the offeree must receive that message as soon as possible. It can be done by a third party. Therefore, it does not require to communicate it personally.
Example:
Dickson v. Dodds (1876)
Counteroffer
To be a contract, it needs an acceptance without adding new things or requests to change anything. In simple words, the counteroffer is like a conditional acceptance. If someone reacts to an offer using another offer, it causes to destroy the very first offer! In short, the first offer does not exist now. But there is another different situation too. When someone seeks further information, it cannot be taken as a counteroffer.
The famous case that can be used to understand this counteroffer is Hyde v. Wrench (1840). There was a farmer named Wrench. He needed to sell his farmhouse to Hyde. So, Wrench made an offer of £1,000. Hyde did not accept the offer as it is. He presented a proposal of £950. This is the counteroffer here. With this new offer, it causes us to cancel the offer of £1000. Wrench rejected it. Again, Hyde asked Wrench to sell his farmhouse with the original proposal. But Wrench had decided to avoid him and not to sell.
There was no contract because of Hyde’s counteroffer of £950. On the other hand, it can be considered as another type of rejection too.
Lapse of time and delay
Some offers have a specific period to accept. Most of the time, the party who offers to enter into a contract, will mention the appropriate time to take it. So, it should be accepted at that time. Unless it will terminate automatically. In a way, it is practical too.
When an offer does not present such a time limit, the offer should be accepted during a ‘reasonable time’. There is no particular definition for this term, ‘reasonable time’. It will depend on the condition of the case. For instance, an offer must be accepted within a day or two if the goods are perishable. There will be several weeks that can be taken at a reasonable time. As we mentioned earlier, it cannot be described indeed.
For instance, Ramsgate Victoria Hotel Co. v. Montefiore (1866) is the best case to identify this factor. This company took a long time to accept an offer that was made four months before. To have a valid contract, the acceptance must be done when the offer is available to do so.
Apart from above, Death of any party can lead to revocation of an offer.
Death of offeror or offeree
The death of the offeror or offeree may lead to terminate the offer. The offeree cannot accept the offer if he or she knows the end of the offeror. So, the offer will be automatically cancelled at such an incident.
Moreover, there is no chance to transfer the right of accepting an offer in such a case. On the other hand, anyone cannot have a contract that includes an offer or an acceptance that was introduced by a dead party.
There are some essential details about this factor in the case of Dickson v. Atherton Warrington LJ.