Question

Problem Questior

Alan had heard that the current owner of Rosenberg Hall was thinking of selling. On 28 April 2020 he wrote a letter to the owner, John, in the following terms: 'Are you interested in selling Rosenberg Hall? If so, at what price?' John received the letter on 29 April 2020 and replied that same day by facsimile addressed to Alan thus: 1 will sell you Rosenberg Hall for $1.000,000. The terms and conditions will be those in the NSW Property Act standard form real estate contract. Please reply by facsimile before 5 May 2020 confirming your acceptance Unfortunately, John's secretary Carol, when sending the facsimile, misdirected it, and it wa received by Sandra. Realising her mistake immediately, Carol re-sent the facsimile to Alan and telephoned Sandra to tell her that the facsimile was sent by mistake.

On 1 May 2020 Alan sent a letter to John, saying: 1 accept your offer to sell Rosenberg Hall and surrounding grounds for $1,000,000. . However, on the same day the stock market wen into a spectacular dive, and by 5 pm Alan had lost a lot of money. Feeling that he could no longer afford to purchase Rosenberg Hall, Alan sent a facsimile to John, which John received at 6 pm, saying that he no longer wished to purchase the property. At this point John had no received Alan's letter of 1 May

Sandra had been extremely interested in purchasing Rosenberg Hall and, ignoring Carol's advice to disregard the facsimile, she faxed an acceptance of the offer immediately upon receipt of John's mis-sent fax on 29 April.

On 1 May 2020 after John received Alan's facsimile stating he no longer wished to purchase Rosenberg Hall, John decided to follow up on Sandra's fax. He sent her a reply by fax, saying: 'l am in receipt of your facsimile of 29 April 2020. I advise that the price is $1,000,000 for the Hall alone.

Sandra received that fax on 1 May and replied that she would purchase the Hall for $1,000,000. On 3 May 2020 John replied that he would accept that price.

On 4 May 2020 Alan recovered all of his losses on the stock market and made a profit. He telephoned John to say that he would now purchase the hall for $1,000,000.

Discuss in a problem-solving format by reference to the law of contract the following:

a. Is there an enforceable contract between(Alanand John/for Rosenberg Hall?

b. Is there an enforceable contract betweep Johnand Sandrałor Roserberg Hall?

Answer 1

After observing the facts of the case, decisions along with reasons are provided below.

1) There is no-enforceable contract between alan and john as alan faced losses in stock market and informed john about his in-ability to purchase the property as negotiated before with john through letter on may 1st, Eventhough he recovered his losses on 4th may.

2) There is enforceable contract between John and sandra, because after alan informed his in-ability to purchase, sandra communicated john on 1st may and proposed the price which was same as quoted by alan to which john agreed to sell his property on 3rd may.

Note: we should consider offer and reply to an offer (positive or negative) and due dates of such replies while making decisions to check whether contract is enforceable or not.

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