Law of Contract (1872):Nature of contract; Classification; Offer and acceptance; Capacity of parties to contract; Free consent; Consideration; Legality of object; Agreement declared void

1.4 Offer and Acceptance

i. Proposal or Offer

According to Section 2(e) of the Indian Contract Act, “When one person signifies to another his willingness to do job, or to abstain from doing, anything with a view to obtaining the assent of the other to such act or abstinence, he is said to make a proposal.”

 1.4.1 Elements/Main features of a Proposal

1. Existence of two parties

For a valid offer, there must be two parties. A person cannot make an offer to himself.

2. Communication

The offer must be communicated to the offence. If it is never communicated to the offence, it cannot be accepted and no valid contract comes into existence.

3. Willingness

The offer must show willingness of the offeror. Mere telling or sharing a plan is not an offer.

4. Intention of Obtaining Assent

The offer must be made with a view to obtain the assent of the offeree. The offer made out of a prank or as a joke is not valid offer, and therefore if accepted, it can never make the valid contract.

5. May be positive or Negative

The offer may involve doing something or not doing something-Section 2(o).The offer to do something is a positive offer or not to do something is a negative offer.

1.4.2 Legal Rules as to Offer

1. Offer Must be definite, Unambiguous and certain

They must be vague or indefinite. If the terms are vague, it is not capable of being accepted as the vagueness would not create any contractual relationship.

2. Offer should not bind the other party to reply

The offer should not bind the other party to reply. In the same way, if the offer should not contain terms, non- compliance of which may be assumed as acceptance.

3. Offer must be made to create legal relationship

While making the offer, the aim of the offerer should be to primarily create a legal obligation. An offer that creates only social or moral obligations does not constitute a valid agreement or contract.

4. The offer may be general or specific

An offer is called specific when it is made to an individual or a group of individuals. In case of a specific offer, only the person or group of persons to whom the offer is made can accept or reject the offer.

5. The offer may be express or implied.

An offer does not necessarily need to be express.it can also be implied. According to Section 9,a specific offer can be made in words-written or oral.

6. The offer should be a request and not an order.

The person making the offer has the right to set conditions to the acceptance of the offer, but he does not have any right to set conditions to the non-acceptance of the offer.

7. The offer must be for a possible act

Man can do only what is possible, and the laws accepts that. An offer or a proposal to do impossible is devoid of practicality or meaning. To make an offer which is humanly impossible is not recognized by law and as such there can be no compliance.

8. The offer must be communicated

An offer, to be complete, must be communicated to the person to whom it is made so that he can accept or not accept the offer. Unless the offer is communicated by the offerer (or by his agent) to the offeree, there can be no acceptance of the offer and as such, no agreement can be reached.