Course capital, indicating a rejection of Guile’s offer to

 

 

Course No: 
LGST101

Course Name: Business Law

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AY 2017/2018 Term 1

 

Group Report

Date of Submission: 
29th January 2017

Presented to: Prof Meera Rajah

Module Group: G13

 

Student Name:

Admin Number:

Angel Ng Jing Yi

S9790028J

Ho Jia Yi

S9639891C

Tang Min Yi Mindy

S9729380E

Irdina Binti Norman

S9773044Z

Grace Tan Lixin

S9823265F

 

 

 

 

 

 

 

 

 

 

 

A.
Whether Ryu has a contract with Guile for the purchase of five Shoryuken bags.

 

Issue A.1: Was there
an offer made by Guile for the purchase of five Shoryuken bags?

The
question here is whether there was an offer made for the purchase of five
Shoryuken bags. In order for a contract to be formed, there are four
requirements to be fulfilled: offer, acceptance, consideration
and intention to enter legal relations. An offer can become an agreement once
the offeree accepts the offer (Gay Choon Ing). For it to be an
offer, there has to be specified terms as well as an intention to be bound. The offeree must agree to all the
terms contained in the offer. Any attempt on his part to introduce new terms
would result in a counter-offer. Counter-offers have two distinct
effects. First, it acts as a rejection of the original offer, causing the
original offer to lapse. Second, it stands as a new offer capable of being accepted
by the offeror (Hyde).

 

According
to the material parts of their phone conversation, Ryu contacted Guile to order
a Shoryuken bag. This was an offer made by Ryu to Guile on the terms of $4,000
for one bag. Guile rejected the offer by stating that he is unable to mail only
one and that he has to order at least five bags. This constitutes as a
counter-offer which makes the first offer by Ryu invalid. Ryu then proceeded to
tell Guile that he does not have sufficient capital, indicating a rejection of
Guile’s offer to purchase at least five bags.

 

Later,
Guile implied a new offer to Ryu when he asked if Ryu wanted “the bag”. Note
that in this case, by specifying “the
bag”, there is an implication that Guile is offering only one bag to Ryu for $4,000. Reasonably, Ryu understood the terms of the offer as one
bag and not the five which was mentioned in the counter-offer made by Guile.

 

As
the offer made by Guile for the purchase of five bags was rejected, the offer
made for the purchase of five Shoryuken bags is invalid. Instead, an offer was
made by Guile for the purchase of one Shoryuken bag. 

 

Issue A.ii: Was there an acceptance made for the five Shoryuken bags?

The
second issue is whether there was acceptance for the five Shoryuken bags. An
offeror may specify the mode of acceptance (Manchester Diocesan Council for Education).
Acceptance may come in various forms, but it is defined as a final and
unqualified expression of assent to the terms of an offer (Peel, 2007).

 

In
this case, it can be interpreted that Guile’s final offer is stated in this
line: “Do you still want the bag or not?
Tell me your address.”
This means that Guile has specified a mode of acceptance for his offer, which
is for Ryu to give him his address. By replying with his address over the phone,
Ryu has accepted Guile’s offer. The action of Ryu giving his address
is a clear indication of his acceptance of the offer for one bag. A contract is
thus formed for the
purchase of one bag at $4,000.

 

As
the offer for five bags was rejected, no contract was formed for the purchase
of five bags between Ryu and Guile.

 

Conclusion

Looking
at all the documents passing between the two parties, it can be observed that
Ryu accepted Guile’s offer for the purchase of one Shoryuken bag instead of
five. Based on the above, there is no contract formed between Guile and Ryu for
five Shoryuken bags. However, there is a binding contract between Ryu and Guile
on the terms of one bag at $4,000 as Guile’s offer for one bag was accepted by
Ryu. Therefore, Ryu is able to hold Guile accountable for one bag only. 

 

Strengths and Weaknesses

Ryu’s
claim against Guile for the purchase of five bags is weak as the counter-offer
made by Guile only indicated the term of one bag. Ryu had also communicated his
acceptance to Guile for the purchase of one bag by providing his address. This
shows that there is a legally binding contract between Ryu and Guile for the
purchase of one bag. The claim against Guile the purchase of five bags will be
weakened since there is no binding contract for five bags.

 

B. Whether
Ryu has a contract with Zangief for the sale of a Hadouken bag.

 

Issue B.i: Was Ryu’s
listing on the online marketplace an offer?

The first issue is whether Ryu’s listing of the Hadouken bag on
the online marketplace, the ooo9 platform, is an offer or invitation to treat. The general rule is that advertisements are considered as invitations to treat. This is to prevent sellers from
getting involved in numerous contractual obligations that he or she would not
be able to carry out (Grainger). Website advertisements
are in principle the same as a billboard outside a shop or an
advertisement in a newspaper or periodical (Digilandmall). Proposals that
employ interactive applications for making orders through such information
systems are invitation to make offers (Section 14 Electronic Transactions Act).
An offer is only formed when it includes a definite promise to be bound
provided that specified terms are accepted (Gay Choon Ing).

 

In
this case, Ryu’s online listing is a form of advertisement, which according to
the general rule is an invitation to treat. Hence, he is trying to invite
customers to make an offer to him. He is only willing to enter into
negotiations but has no intention to be bound. Zangief placing an order with
Ryu for a Hadouken bag is considered to be an offer made to Ryu.

 

Therefore,
Ryu’s online listing is an invitation to treat and Zangief placement of the
order is considered as an offer.

 

Issue B.ii: Was there an acceptance by Ryu regarding Zangief’s offer?

The
second issue is whether Ryu accepted Zangief’s offer. Acceptance is defined as
a final and unqualified expression of assent to the terms of an offer (E
Peel, Treitel on the Law of Contract). When there is acceptance, the
offer comes to an end and a contract is then born (Gay Choon Ing).

 

Zangief
made an offer to Ryu by placing an order for a Hadouken bag. The seller may or
may not accept the offer and in this case, Ryu replied that the goods are out
of stock which indicates his rejection. Ryu did not show a final and unqualified
expression of assent.

 

Ryu
rejected Zangief’s offer and thus there is no contract between Ryu and Zangief
for the sale of a Hadouken bag.

 

Conclusion

The
generally accepted rule recognizes that Ryu’s online listing is an invitation
to treat and Zangief placing an order is an offer. Ryu did not accept the
offer, therefore there is no contract formed between Ryu and Zangief. This
means that Zangief is unable to enforce his contract against Ryu.

 

Strengths and Weaknesses

Ryu’s
claim is strong against Zangief. However, one weakness to this case is that
assuming Ryu did not mention the quantity of his goods, Zangief can argue that
he made an order thinking that there were still goods available. If a web merchant does not quantify his offer
appropriately, it could be seen as an offer being made to sell an infinite
supply of goods (Digilandmall). Since it was only after placing an order that
Zangief was informed of the goods being out of stock, he can argue that there
is a breach of contract on Ryu’s part.

 

C.
Whether Ryu has a contract with Ken for the purchase of 50 packs of SonicBoom
face masks.

 

Issue C.i: Was Ryu’s
offer a unilateral contract?

The
first issue here is whether Ryu’s offer is a unilateral one. An offer is
considered to be unilateral if it was not made to a person/entity in
particular. In a unilateral contract, the offeror makes a promise in return for
an act to be performed by the offeree. To accept a unilateral offer, one does
not need to notify the offeree of his/her acceptance, but only has to embark on
the performance required of him/her (Carlill). Performance of the act by
the offeree constitutes both the acceptance of the offer and considerations to
be given. (Cengage Learning, 2nd Ed, 2013)

 

Since
Ryu posted his offer to a group of people without addressing anyone in
particular, his offer is considered unilateral. By offering to pay back anyone
who was willing to buy the SonicBoom face masks for him, he is making a promise
in return for an act to be performed by the offeree(s). Here, Ken embarked on
performance by buying the face masks that Ryu asked for, therefore accepting
Ryu’s offer.

 

Ryu
has made a unilateral offer and Ken has accepted it by embarking on the
performance required of him. Therefore, a unilateral contract was formed.

 

Issue C.ii: Was Ryu’s
unilateral offer successfully revoked?

The
next question is whether Ryu’s offer was successfully revoked since Ken did not
see his post on the revocation of his offer. In order to revoke a unilateral
offer, two issues have to be considered: the means by which revocation is to be
validly effected and whether the unilateral offer can be revoked once
performance has begun. Performance is on the basis that there are two offers: a
main offer and an implied one not to revoke the main offer (Daulia). Revocation can
be done any time before acceptance and can be done through third parties,
provided that it is reasonable for the offeree to believe the source (Dickinson).

 

We
will now be assessing whether Ryu has fulfilled the two considerations required
to revoke a unilateral offer as mentioned above.

 

Firstly,
since his offer was initially posted on the fighters’ Facebook chat group, by
posting a second post to withdraw his offer, Ryu has taken reasonable steps to
bring the revocation to the attention of the relevant persons. Moreover, Ryu
had asked his friends to spread the word of his withdrawal as he had taken into
account the fact that Facebook is banned in China and some people may miss his
message. His revocation is thus said to be validly effected.

 

Next,
Chun Li had passed on the message of Ryu’s revocation to Ken before he bought
the masks in Guangzhou. Since it is reasonable for Ken to believe Chun Li as
they know each other and were even going to Guangzhou together, she is a valid
messenger of Ryu’s revocation. Considering that Chun Li had relayed Ryu’s
message before Ken bought the masks, Ken had known of the revocation before he
embarked on his performance. Therefore, Ryu’s revocation had been made known to
Ken before the latter embarked on the required performance (i.e. purchasing the
masks). Additionally, Ken’s act of freeing up luggage space for the masks is
considered as insufficient performance since it was not part of the condition
which Ryu has imposed. This means that Ken had not embarked on full performance
of Ryu’s imposed conditions.

 

Hence,
Ryu has successfully revoked his offer before Ken embarked on the full
performance required of him.

 

Conclusion

With
all the above mentioned, the revocation of offer by Ryu is valid as both
conditions for revocation of unilateral offers were met. Thus, there is no
contract between Ken and Ryu for the purchase of 50 packs of SonicBoom masks.

 

Strengths and Weaknesses

Ryu
has a strong case in stating that he has no contract with Ken. This is because
the general rule for revocation of unilateral offers is in his favour and he
had taken the necessary steps to revoke his offer. However, Ken may choose to
argue that it is not reasonable for him to believe Chun Li since they had a
conflict in the past which led to his distrust towards her. Therefore, it may
be argued that Chun Li’s communication of the revocation to him was invalid so
there is a contract between Ryu and Ken.

 

D. Whether
Ryu has a contract with Dhalsim for the purchase of Doraemon.

 

Issue D.i: Did Ryu make an offer to Dhalsim?

The
question here is whether there was an offer made by Ryu to Dhalsim. An offer
must consist of a definite promise to be bound provided that certain specified
terms are accepted. The wording or conduct of a person can be used as a test to
evince an intention to be bound (Gay Choon Ing). In addition,
subjective intention of a silent mental conduct is not relevant and not
enforceable under the law (Midlink Development Pte Ltd).

 

In
the present case, Ryu announced in a loud voice his intention to buy the
Doraemon, indicating that he was making an offer to Dhalsim. To complete his
act, he even paid Dhalsim $300 for it which shows that he was serious about his
purchase. His conduct of paying Dhalsim and announcing that he will buy the
Doraemon suggests his willingness to form a contract with Dhalsim. Even though
Ryu gave a quick wink to Dhalsim to show that it was all an act, Dhalsim would
not have understood Ryu’s intention since it is a silent mental conduct. The
wink is subjective as it may bear different meanings to both parties.

 

Therefore,
Ryu’s conduct was construed as an act of making an offer to Dhalsim.

 

Issue D.ii: Did Dhalsim accept Ryu’s offer?

The
next issue is whether Dhalsim accepted Ryu’s offer. The general rule is that
acceptance has to fulfill two criteria. Firstly, it has to be final and
unqualified and secondly, it has to be communicated to the offeror (Gay
Choon Ing).  Also, there must be
a meeting of minds (consensus ad idem) between both parties where they think in
the same manner before an agreement. Meeting of minds is established by
applying the rules of offer and acceptance.

 

The
transaction was completed when Dhalsim accepted Ryu’s $300. By accepting the
money, there was an acceptance made by conduct. This shows that there was a
meeting of the minds during offer and acceptance.

 

Thus,
Dhalsim has communicated his acceptance to Ryu.

 

Conclusion

Ryu’s
claim against Dhalsim is likely to fail. There is a valid contract between them
as Ryu had made an offer to Dhalsim through both words and conduct and Dhalsim
had accepted Ryu’s offer. Therefore, a contract between Ryu and Dhalsim was
legally formed and is enforceable by law. Ryu will not be able to revoke his
offer by seeking a refund of $300.

 

Strengths and weaknesses

Ryu’s
claim is weak against Dhalsim because there is a valid and legally binding
contract between them. In the eyes of the law, Ryu has showed an expression of
willingness to enter into contract with Dhalsim through his words and conduct,
and Dhalsim had accepted the offer. Since there is a valid contract formed, Ryu
will not be able to revoke his offer and seek a refund. Although Ryu may argue
that his wink to Dhalsim shows that he had no intention to be legally bound,
the court can objectively judge that Ryu’s quick wink is subjective and
reasonably may not be perceived by Dhalsim as an indication of Ryu’s ruse.
Therefore, his wink cannot be argued as an indication to not to be legally bounded.
Ultimately, Ryu’s intention must be understood in a way that a reasonable
person in the position of the recipient would have understood then (Destiny
1 Ltd).

 

 

 

 

 

 

 

References

 

Carlill v Carbolic Smoke Ball 1893 1 QB 256

Chwee Kin Keong v Digilandmall.com Pte Ltd 2004 2
SLR(R) 594

Daulia Ltd v Four Millbank Nominees Ltd 1977 EWCA Civ 5

Dickson Trading v Transmarco Ltd 1987
SLR(R) 674 at 39

Gay Choon Ing v Loh
Sze Ti Terence Peter and another appeal 2009 2 SLR(R) 332; 2009 SGCA 3

Grainger & Son v Gough (Surveyor of Taxes) 1896 AC
325

Hyde v Wrench 1840 EWHC Ch J90 

Manchester Diocesan Council For
Education V.commercial & General Investments Ltd. – 1970 1 WLR 241

Midlink Development Pte Ltd v The Stansfield Group Pte Ltd 2004 4
SLR(R) 258; 2004 SGHC
182

 

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