Question

Ming Restaurant wanted to change some of its furniture. The manager, Lia, contracted Deem Furniture to enquire about the prices of tables and chairs. Deem Furniture faxed Lia a quotation for a sum of $30,000 based on Lia's selection of models. Upon receiving the fax, Lia called Deem Furniture and bargained the price to $28,000. Deem Furniture replied that it would think about the matter and get back to Lia the next day. The same afternoon, Ming Restaurant's assistant manager, Gabby, obtained a better quotation from Ditty Furniture. The same models of furniture would only cost $25,000. Lia planned to purchase the furniture from Ditty Furniture instead.

a) Explain who the 'offeror' and 'offeree' are in the situation above.

b) Could Lia purchase the furniture from Ditty Furniture? Justify your answer.

Answer 1

A) In the situation when Deem Furniture faxed Lia(Manager of Ming Restaurant) a quotation for a sum of $30,000, then Deem Furniture is the offeror and Ming restautant is the offeree. Deem Furniture is the offeror because it has initiated the offer and Ming restaurant is the offeree because it can either accept or reject the order.

When Ming Restaurant negotiated the price for $28,000, then Ming Restaurant is the offeror and Deem Furniture is the offeree.

In the next situation,when Ditty Furniture sent the quotation to Ming restaurant then in this case, Ditty Furniture is the offeror and Ming Restaurant is the offeree.Ditty Furniture is the offeror because it has initiated the offer and Ming restaurant is the offeree because it can either accept or reject the order.

B) Yes, Lia could purchase the furniture from Ditty furniture as she has not signed any contract with Deem Furniture. She was looking for other sellers to find the best priced furniture for the restaurant but she did not come under any legal agreement with the seller.

She asked for the decrease in price with Deem furniture which does not make her liable to bind into any contact with Deem Furniture.

Furthermore, Even Deem Furniture has also not accepted their offer to settle at $28000 so far. So, no one can object if Lia makes the deal with Ditty Furniture.