Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA LW Exams › Counter offer or Request for information
- This topic has 24 replies, 2 voices, and was last updated 7 years ago by MikeLittle.
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- October 18, 2016 at 5:31 am #344496
Jim wrote a letter of offer to Ken for selling Ken his business for RM2million. However, Ken replies and says that “he can only afford it if he could pay for it in four installments”. Jim does not respond.
Is it counter offer or just request for it?
October 18, 2016 at 7:05 am #344508It’s neither really … it’s a statement of Ken’s financial condition
If Ken had replied “Accepted but I’ll pay it in 4 instalments” that would have been rejection and counter-offer
If the reply had been “May I pay the amount in 4 instalments?” that would have been a request for information
But simply to say “I can only afford it if I can pay in 4 instalments” is not a request (where’s the question?) and nor is it a counter-offer
It’s a statement of the parlous state of Ken’s resources
October 18, 2016 at 12:00 pm #344638Can it means like inquiry?
October 18, 2016 at 12:09 pm #344646The other issue is Jenny make an offer to David to buy his business on 14 July 2016 via facebook. David replied Jenny’s message on facebook accepting Jenny’s offer and gave her instructions on the payment details on 16 July 2016.
Can i say even there is offer and acceptance but Jenny did not give David consideration therefore there is no contract between Jenny and David. As there is no contract, David may revoke his acceptance as long as Jenny has not made the payment.
October 18, 2016 at 12:18 pm #344657“Can it means like inquiry?”
Can what means “like inquiry”?
October 18, 2016 at 12:21 pm #344661“Can i say even there is offer and acceptance but Jenny did not give David consideration therefore there is no contract between Jenny and David.” – you can say that …. but it would be entirely incorrect!
When David accepts Jenny’s offer, then we have a contract
October 18, 2016 at 12:36 pm #344673The whole story is Jim wrote a letter of offer to Ken for selling Ken his business for RM2million. However, Ken replies and says that “he can only afford it if he could pay for it in four installments”. Jim does not respond. After that, Ken sends a letter to Jim accepting Ken’s offer and enclosed a cheque for the sum of RM2 million.
It seems like Ken inquires Jim whether he could pay in four installments. Jim does not respond and then Ken accepted Jim’s offer by the whole amount. There is a contract.
Am I right?
October 18, 2016 at 12:40 pm #344676For Jenny and David, actually the whole story is Jenny make an offer to David to buy his business on 14 July 2016 via facebook. David replied Jenny’s message on facebook accepting Jenny’s offer and gave her instructions on the payment details on 16 July 2016. On 18 July 2016, David had changed his mind and he did not want to sell. Can he revoke his’s acceptance? (We do not know whether Jenny had made the payment during 16 July to 18 July)
October 18, 2016 at 3:57 pm #344736Now, here’s a question for you!
You have given me two half stories and you expected me to be able to answer them!
And you finished up having to write out both stories in full anyway!
Ok, Ken and Jim. Ken’s statement about instalments is neither a counter-offer nor is it acceptance. Strictly speaking, it isn’t even a request for information.
Whatever Ken’s statement may be classified as, it drew no response from Jim so Jim’s offer is still open.
The act of Ken paying RM2 million (what are RMs? Malaysian ringgits?) would imply that Ken has accepted Jim’s offer.
I think if I were a judge in KL listening to this case I would be leaning towards deciding that Jim and Ken ARE in contract
October 18, 2016 at 4:02 pm #344737For Jenny and David, as per my previous post, when david responded on 16 July on Facebook, that’s when the contract was made
I am not aware of any particular rules re offers and acceptances via social media but I imagine the rules are similar to those that obtained when the fastest communication was via tele-printer
In those days, acceptance was when the offeror HEARD the response and a teleprinter / fax were deemed to be oral acceptance
As such, they were deemed to have been received (effectively) as soon as they were transmitted and I imagine the rules involving Facebook are similar
And next time you have a question, please give me 100% of the facts at the start!
October 18, 2016 at 4:55 pm #344754I am so sorry, Mr. Mike. It is my fault . I apologizes for making you inconvenient.
I am still confusing about revocation now…. Revocation must be before acceptance and must be communicated. But the situation below makes me feel so confusing.
On 15/9/2016, A offered B to buy his cafe via post states he would keep the offer within a week for B. After that day, C made an offer to A that she would want to buy A’s cafe. B accepted A’s offer via post and enclosed a cheque on 19/9/2016. On the same day, A accepted C’s offer. B only knew that A had sold his cafe to C from his mutual friend on 20/9/2016.
As the question did not state that which issue came first, I made my own assumption. If B posted the letter to A before A accepted C’s offer, then the revocation is invalid because revocation must be before acceptance. Then how about if A accepted C’s offer before the acceptance of B? The revocation happened before the acceptance but B only knew it after his acceptance ( the communication is not completed). Is the revocation still valid?
October 18, 2016 at 7:11 pm #344778Yes, because A and C are in contract before B’s acceptance
October 19, 2016 at 3:23 am #344873Even though the communication is completed after the acceptance?
For Jenny and David, contract is made when the acceptance happened. However, there is a section states that agreement without consideration is void.
So, is there still a valid contract?October 19, 2016 at 4:43 am #344881Revocation will be effective only if the recocation is happened before the acceptance and is known by the offeree before he accepts the offer. Isnt it?
Then for A and B, B only knew the offer was revoked on 17/9/2016 after he accepted A’s offer on 16/9/2016. The revocation was happened before B accepted the offer via post but B only knew it after he accepted the offer. That means the communication of revocation was completed after B’s acceptance. The revocation is still effective??
October 19, 2016 at 7:55 am #344914“Even though the communication is completed after the acceptance?” – which one are we on now?
Jenny and David, Ken and Jim or A, B and C?
“However, there is a section states that agreement without consideration is void”
The acceptance is accompanied by the agreement to pay the agreed sum … and that’s consideration
In the A, B and C case B appears to be taking advantage of the one week option period for which time A has said that the offer will remain open
What has B given by way of consideration in exchange for A keeping the offer open during that option period?
I see no consideration coming from B and therefore B is not able to rely upon the option period
I’m sticking with my original decision … the contract is formed between A and C
October 19, 2016 at 8:32 am #344924“Even though the communication is completed after the acceptance?” – which one are we on now?
Jenny and David, Ken and Jim or A, B and C?A, B and C.
Even though the revocation is happened before the offeree accept the offer, but the offeree knows the revocation after his acceptance which means the offeree has not noticed about the revocation when/before he accepts the offer. He just only knows it after he accepted the offer.From my research, the common law’s answer is that revocation is not effective until it reaches the offeree. Only then will it be considered as communicated to him, so as
to destroy his power of acceptance.In this case, the revocation is ineffective?
“The acceptance is accompanied by the agreement to pay the agreed sum … and that’s consideration”
This means that the consideration given by Jenny to David is “she agreed to pay the agreed sum to David for buying his business”?
October 19, 2016 at 8:55 am #344936“From my research, the common law’s answer is that revocation is not effective until it reaches the offeree. Only then will it be considered as communicated to him, so as to destroy his power of acceptance.”
But acceptance must be within a ‘reasonable time’ – we can’t tell whether the time scale in your scenario is reasonable or not
You said that the Jenny / David scenario acceptance was not supported by consideration? You’re confusing me!
Your original post says that Jenny makes the offer and David accepts it
October 19, 2016 at 9:32 am #344942You said that the Jenny / David scenario acceptance was not supported by consideration? You’re confusing me!
Your original post says that Jenny makes the offer and David accepts it
Ya, Jenny makes the offer and David accepts it.
The question does not mention did Jenny give David any consideration. The question only stated Jenny would like to buy David’s business for RM1million and David accepted her offer.So I am wondering is there any consideration? If no consideration, the contract then become void? (but David already accepted Jenny’s offer) If have, then what is the consideration?
I do really not understand about it.
October 19, 2016 at 9:51 am #344947“The question does not mention did Jenny give David any consideration” – she’s offered RM 1,000,000! What’s that if it’s not consideration?
And the consideration moving from David is “his business”
October 19, 2016 at 1:24 pm #344974I think I understand what you have said. Thank you Mr Mike! Your answer really helps me a lot.
October 19, 2016 at 2:22 pm #344981You’re welcome
October 20, 2016 at 9:04 am #345136Sorry, Mr. Mike. I have one more question.
The offeror sent a letter of offer to the offeree on 11 June 2015. On 14 June 2015, the offeror asked the offeree whether he had received the letter which the offeree answered had not. However, on returning home, the offeree’s wife informed him that the letter was received on that afternoon.
So, the offer is invalid bacasue the offeree cannot accept it as the offer is without his knowledge?
October 20, 2016 at 9:15 am #345142You’ve done it again!
Please send me the FULL question and I’ll have a chance of answering it
For example, there is nothing in your post that says whether the offeree wants to accept it or not … or whether he did accept it and the offeror says “No” … or why the offeror phoned up the offeree … or why the offeree answered that he hadn’t received the letter instead of saying “I left before the post arrived this morning so it could be at home right now. Why do you ask? What was in your letter?”
Please, give me the full question
October 20, 2016 at 9:37 am #345150Actually I just wondering whether the offer is valid if in such situation.
Let say the offeror wrote a letter of offer to buy offeree’s business and enclosed a cheque inside on 11 June 2015. On 13 June 2015, the offeror heard from his friend said that the offeree’s business had already been sold to someone else. So, the offeror went to find the offeree on 14 June 2015 and asked the offeree if he had received the letter which the offeree answered had not. However, on returning home that evening, the offeree finds offeror’s letter in his room and His wife informed him that it came by courier that afternoon.
So in such situation, can the offer be valid?
In my opinion, the offer is invalid and the offeror cannot assume the offeree accepts his offer because the offeree cannot accept it as the offer is without his knowledge.October 20, 2016 at 1:22 pm #345181Oh, you are writing some rubbish!
How can an offer not be valid?
The only kind of invalid offer would be one for an illegal purpose
How can the offeror POSSIBLY assume that the offeree has accepted an offer? It is accepted when notification of acceptance is made to the offeror and, that being so, it’s not up to the offeror to assume one way or the other
“So, the offeror went to find the offeree on 14 June 2015 and asked the offeree if he had received the letter …” What has this got to do with anything?
And what if the offeree had said “Yes, I received your letter”
So what? What does that prove (other than the efficiency of the courier service)
And whether or not the letter has been received
and whether or not the business has already been sold to someone else
and whether or not the offeree’s wife should never have signed for the receipt of the letter
and whether or not she should have put it in ‘his room’ (what a quaint idea .. ‘his room’
an offer is an offer and NONE of the above contrivances is in the slightest way relevant
F4 is difficult enough without you trying to dream up (impractical) hypothetical (silly) scenaria
This response of mine is now the 25th in this thread.
That’s way too many for a simple matter of “counter-offer or request for information”
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