Offer: Meaning, Types & Rules

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Meaning

A contract lies on the basic block called OFFER. An Offer is usually understood as a Proposal. According to Section 2(a) of the Contract Act-

“An individual is said to have made the offer when he implies to another his readiness to do or to avoid doing anything with a perspective to getting the consent of that other to such act or restraint.”

Parties

The parties involved in offer are:-

  • Offeror- The person who is making an offer to other is called Offeror or Propose.
  • Offeree- The Person to whom the offer has been made is called Offeree or Proposee.

As per Section 2(c), when the offeree accepts the proposal by the offeror than he becomes the Acceptor of that offer.

Types of Offer

(i). Express offer: – It is an offer that is done through words that can be either oral or written. The oral offer can be made face to face or via telephone. The written offer can be made via text messages, advertisements, letters or e-mail.

(ii). Implied Offer: – It is an offer conveyed through acting or signs. But if a party observes a silence over the offer then that offer cannot be valid.

(iii). Specific Offer: -It is the offer made to a specific person or group of persons and can be accepted by the same, not anyone else.

E.g William offers to buy a car from Miley for Rs 10 Lakh. Thus, a specific offer is made to a specific person, and only Miley can accept the offer.

(iv). General Offer: -It is the offer made to public at large and not to any particular person. it can be accepted by anyone by abiding by the terms of it.

E.g. Mr. A advertises in the newspaper that whosoever find his missing son would be rewarded with $500.Mr. B reads it and after finding the boy, he calls Mr. A to inform about his missing son. Now Mr. A is entitled to pay $500 to Mr. B for his reward.

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(v). Cross Offer: -When both the parties involved makes a similar offer to one another without knowing the each other’s offer then it is called Cross offer.

E.g X sends an e-mail to Y to purchase his car for $200 while at the same time, Y unknowingly is also sending an e- mail to X stating his desire to buy the car at $200.This is the cross offer made where one party needs to accept the offer of the another.

(vi). Standing or Open Offer: The offer that is continuous in nature is the standing offer.

Rules for a valid Offer

  1. Expectation to Create Legal Relationship: – An offer must mean to make lawful relations. An offer should be such that when the other party will accept it then it will make the legal relationship among the parties.
  2. Certain and Clear Terms: – The terms of the offer must be certain and clear and not ambiguous. If the terms of the offer made are unclear, then no agreement can be gone into because it is not clear regarding what precisely the parties expected to do.
  3. Differ from Declaration of Intention: -Offer and intention are different. Intention to offer indicates the offer will be made.The case of Farine v Ficker.
  4. Proper Communication: – The offer should be properly communicated as to whom the offer is made. The offer stands completely only when the offeree is communicated about the same. If offer accepted without any proper communication and information is not valid.
  5. Presumption of the offer: – The offeror cannot pressure the offer is accepted if the offeree does not accept for a certain period. Till the offeree replies back with the acceptance of the offer, then only the offer stands to be a valid offer.
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