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Proposal/Offer for CLAT - Practice Questions & MCQ
Edited By admin | Updated on Oct 03, 2023 03:26 PM | #CLAT
Quick Facts
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10 Questions around this concept.
Solve by difficulty
Passage 4
Read the passage and answer the question that follow.
An offer is also called "proposal'. The words 'proposal' and 'offer' are synonymous and are used interchangeably. Section 2(a) defines the term 'proposal' as follows: "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 such act or abstinence, he is said to make a proposal. "An offer can be made by any act which has the effect of communicating it to the other. An offer may either be an 'express offer' or an 'implied offer'. According to law, an offer can be accepted only by the person to whom it is made. Hence, we must know how to identify the person to whom the offer has been made. From this point of view, an offer may be 'specific' or 'general.
Acceptance is an expression by the offeree of his willingness to be bound by the terms of the offer. This results in the establishment of legal relations between the offeror and offeree. Section 2(b) of the Indian Contract Act defines the term 'acceptance' as "when the person to whom the proposal is made signs his assent thereto, the proposal is said to be accepted. A proposal when accepted becomes a promise. An offer can be accepted only by the person or persons to whom it is made. An offer made to a particular person (specific offer) can be accepted only by him and none else. You know that an offer may be either express or implied. Similarly, the acceptance may also be either expressed or implied. When the acceptance is given by words spoken or written, it is called an 'express acceptance'.For example, A offers to sell his book to B for Rs. 20. B may accept this offer by stating so orally or by writing a letter to A. Acceptance may also be implied by conduct. For example, A offers a reward of Rs. 100 to anyone who traces his lost dog. B, who was aware of this offer, finds the dog, he is entitled to the reward as he accepted the offer by doing the required act.
Question:
Company ABC, which runs a bus service stops at a nearby bus stop without expressly offering the passengers to board the bus, then:
Passage 4
Read the passage and answer the question that follow.
An offer is also called "proposal'. The words 'proposal' and 'offer' are synonymous and are used interchangeably. Section 2(a) defines the term 'proposal' as follows: "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 such act or abstinence, he is said to make a proposal. "An offer can be made by any act which has the effect of communicating it to the other. An offer may either be an 'express offer' or an 'implied offer'. According to law, an offer can be accepted only by the person to whom it is made. Hence, we must know how to identify the person to whom the offer has been made. From this point of view, an offer may be 'specific' or 'general.
Acceptance is an expression by the offeree of his willingness to be bound by the terms of the offer. This results in the establishment of legal relations between the offeror and offeree. Section 2(b) of the Indian Contract Act defines the term 'acceptance' as "when the person to whom the proposal is made signs his assent thereto, the proposal is said to be accepted. A proposal when accepted becomes a promise. An offer can be accepted only by the person or persons to whom it is made. An offer made to a particular person (specific offer) can be accepted only by him and none else. You know that an offer may be either express or implied. Similarly, the acceptance may also be either expressed or implied. When the acceptance is given by words spoken or written, it is called an 'express acceptance'.For example, A offers to sell his book to B for Rs. 20. B may accept this offer by stating so orally or by writing a letter to A. Acceptance may also be implied by conduct. For example, A offers a reward of Rs. 100 to anyone who traces his lost dog. B, who was aware of this offer, finds the dog, he is entitled to the reward as he accepted the offer by doing the required act.
Question:
Rajat makes an offer to Rohit, to sell his car at Rs. 10 Lakhs, however, Rohit replies that he is willing to buy the car at Rs. 7 Lakhs, then:
Rohan sold his business to Sam. Mani, an old customer sent an order for goods to Rohan by name. Sam, the new owner, executed the order. Mani refuses to accept the goods from Sam as he intended to deal only with Rohan. There is a suit by Sam against Mani. Decide?
What are the modes of revocation of an offer as per the Indian Contract Act, 1872?
Concepts Covered - 1
Proposal/Offer
What is a Proposal/Offer in Contract Law?
A proposal or offer, in the context of contract law, is a fundamental step in forming a legally binding agreement between parties. It represents a promise or expression of willingness by one party (the offeror) to enter into a contract with another party (the offeree) under specific terms and conditions. To understand this concept better, let's break it down further:
Essentials of a Valid Offer:
For an offer to be legally valid, it must meet the following essential elements:
Intention to Create Legal Relations:
The offeror must intend for the proposal to create a legally binding contract. This means that both parties involved in the contract must understand that they are entering into a legal agreement, and not all offers are intended to create such relations.
Example: A offers to sell his bicycle to B for ₹2,000. Both A and B understand that if B accepts the offer, they will be legally bound to complete the transaction.
Definite and Clear Terms:
The offer must contain clear and definite terms, leaving no room for ambiguity or misunderstanding. This includes specifying the subject matter of the contract, the price, the time of performance, and any other essential details.
Example: A offers to rent his apartment to B for one year, starting on January 1st, at a monthly rent of ₹20,000, with B responsible for paying the utility bills.
Communication:
The offer must be effectively communicated to the offeree. This means that the offeree must be aware of the offer's existence and terms before they can accept it.
Example: A sends an email to B, offering to sell a piece of artwork. The offer is considered communicated when B opens and reads the email.
III. Revocation of Offers:
It's important to note that an offer can generally be revoked (withdrawn) by the offeror at any time before it is accepted by the offeree, unless the offer is irrevocable due to an option contract or other legal factors.
Examples of Proposals/Offers:
Sale of Goods:
A offers to sell a specific model of a smartphone to B for ₹30,000. The offer specifies the subject matter (the smartphone), the price (₹30,000), and the parties involved (A and B).Job Offer:
X, a software company, offers Y a position as a senior software developer, starting on a specific date, with an annual salary of ₹1,000,000 and specific job responsibilities.
Advertisement:
An online store advertises a laptop for sale at ₹40,000. When a customer visits the store's website and places the laptop in their cart, they are expressing their intention to accept the offer.
Indian Case Law: Lalman Shukla vs. Gauri Dutt (1913):
Background
- The case of Lalman Shukla vs. Gauri Dutt revolves around the issue of whether a reward offered for the return of a missing person could be claimed by someone who was unaware of the offer at the time they performed the act.
Key Facts
- Gauri Dutt, the plaintiff, had posted a reward notice in search of his missing nephew.
- Lalman Shukla, the defendant and an employee of Gauri Dutt, found the missing nephew but was unaware of the reward offer when he did so.
- Subsequently, when Lalman Shukla learned about the reward offer, he claimed the reward from Gauri Dutt.
Legal Issue
- The central issue in this case was whether Lalman Shukla, who was unaware of the reward offer at the time he found the missing nephew, could claim the reward.
Court's Decision and Significance
- The court ruled in favor of Gauri Dutt, the plaintiff.
- The court held that Lalman Shukla could not claim the reward because he was unaware of the offer when he found the missing nephew.
- The court emphasized that for an offer to be accepted, the offeree must have knowledge of the offer's existence at the time they perform the act.
Significance
- The case of Lalman Shukla vs. Gauri Dutt (1913) is significant in contract law because it underscores the principle of "knowledge of the offer" in the acceptance of an offer.
- It establishes that to accept an offer and create a legally binding contract, the offeree must be aware of the offer's existence and terms at the time they perform the act that constitutes acceptance.
- This case highlights the importance of communication and awareness in contract formation.
- It serves as a precedent that informs the understanding of the essential elements of a valid contract, particularly the requirement of mutual assent and knowledge of the offer.
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