The Case Of Carlill V Carbolic Smoke Ball Co

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Question 1a: The legal issue in this question is whether or not there is a binding contract between Leila and Julie since Julie had returned Leila’s gold locket and chain without telephoning Leila first. In this situation, the general principal of law relevant to this issue is that, Leila has made a commercial agreement of a unilateral offer by placing an advertisement in the newspaper. This offer has been made to the world at large hence, a promise of performance of an act made to the world cannot be revoked. This principal of law has been justified in the case of Carlill v Carbolic Smoke Ball Co (1893) 1 QB 256. In this case, Carbolic Smoke Ball has posted an advertisement stating that whoever bought the smoke ball and used it correctly and still had flu will be entitled to 100 pounds. The court held that the words stated in an advertisement did mount up to an offer, and for one to accept the offer, he/she only needs to follow the indicated method of acceptance. This would mean that there is a binding contract between Leila and Julie since Julie did fulfil Leila’s advert requirements by returning Leila’s gold locket and chain. The principal is also justified in the case of Merrit v Merrit (1970) 1 WLR 1211. In this case, a husband and wife separated had made arrangements for the future whereby he would transfer her the house after mortgage was paid off. However refused to do so later although he wrote it down and signed the paper. The court held that there was an intention to create legal relations since both husband and wife were not living together when the agreement was made. Since intention to create legal relations is an essential of a contract, Leila has the intention of creating legal relations with the person who fin... ... middle of paper ... ...e to Adam. Since Edwin breached the contract by later refusing to go through with the contract, a reasonable sum should be compensated for Adam’s disappointment and the lost of the opportunity to own a vintage car. Edwin can claim that the contract should be terminated as there is a counter offer. In the case of Hyde v Wrench (1840) 49 ER 132, Hyde made an offer to Wrench to buy his estate at a lower price but his offer was then refused. When Hyde sought to accept the initial offer, it was held that there was no contract made since the initial offer no longer exist. The principal of law established from Hyde v Wrench(ibid) is a counter-offer effectively destroys original offer. However, the termination of contract due to counter offer would only be applicable if Edwin and Adam did not enter into a contract for the purchase of the car at an agreed price of $500,000.

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