Case Study - Making An Offer

Matilda put an advertisement in the paper to sell her Samsung home theatre system (2 months old and still in warranty) for $3000. She gave a post office box number as her contact details. Jassi saw the advertisement and wrote to Matilda saying she would take the home theatre system at the price advertised. Matilda received a number of letters expressing interest. On 8 March she wrote to Jassi and told her that she now wanted $3500 for the home theatre system and would keep her offer open for one week. Jassi received the letter on 9 March and wrote back to Matilda saying she would accept the offer. She posted the letter on 10 March. Unfortunately Matilda did not receive the letter until 16 March. On 10 March Matilda met her cousin Meika and discussed the sound system. Meika told Matilda she would really like the sound system but could not afford the full price. Matilda told Meika she could have the sound system for $2500 if she would look after Matildas children on Saturday nights.

1. Indicate the following by finding/highlighting the appropriate words in the case study: a. invitation to treat b. intention to create legal relations c. offer d. counter offer e. consideration f. acceptance g. breach of contract h. vagueness of terms 2. Was Jassis first letter to Matilda an offer or an acceptance? Give reasons. (Consider Matildas advertisement was there a means to accept this? An offer must have a means of acceptance. Use relevant definitions from the text book, eg invitation to treat, offer, acceptance)

3. Was Jassis second letter an acceptance? Was Matilda bound by this acceptance? Explain. Identify a case that illustrates this point. (Define acceptance. Did Jassi meet the requirements for acceptance? Refer to the case of Felthouse v. Bindley (1872) what precedent did this case set that is followed in Australia? What are the rules of postal acceptance when a date has been set by the offeror?)

4. Has Matilda breached her contract to Jassi? Explain. (Did Matilda and Jassi have a valid contract on the 10 March when Matilda discussed selling the sound system with her cousin Meika?)