Question

In: Economics

Are auctions offers or invitations to treat? Are tenders offers or initiations to treat? Can silence...

Are auctions offers or invitations to treat?

Are tenders offers or initiations to treat?

Can silence amount to acceptance?

What is meant by ‘battle of the forms’ cases?

Solutions

Expert Solution

(a) When a contract is formed by inviting other parties to make an offer by supplying information, it is called as invitation to treat. On the other hand, when legally binding contracts are made as people show their willingness to enter the contract it is called as an offer. An auction can be categorised as invitation to treat as it allows the seller to accept bids and get the chance to choose whom to sell the item. But it becomes an offer when the seller accepts the highest bidder to sell his property due to absence of any reserve price.

(b) Tenders are generally invitation to treat as clients invite people or contractors to make best offers for him as the main objective of tenders are to negotiate a on the terms of the tender on which the contract should be made.

(c) Silence can not amount to acceptance as the silence of a person towards an offer indicates the unwillingness of the person to make a deal. When a person is provides an offer and he does not respond, it will not bound him to make any contract and any acceptance towards the deal unless and until there is any prior dealings between the both parties where they agreed to deal silence as acceptance.

(d) When two business parties especially buyers and sellers come into conflict while negotiating a deal and terms of the contract try to influence the terms of the contract for their own personal benefits, 'a battle of forms' arise.


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