Assessment 2 Case Study Example | Topics and Well Written Essays - 1500 words

Assessment 2 - Case Study Example The indication is known as offer. An offer is an explicit or implied conduct by the offeror which indicates his willingness to commence a legal relationship with the offeree (Smith V Hughes). An offer must be accepted by the offeree. Acceptance creates a consensus ad idem which is the meeting of two minds and a binding contract is formed. The acceptance of an offer must be communicated by the offeree to the offeror. Communication of an acceptance is in different forms. However, acceptance through post comes with distinct rules. In Adams V Lindsell (1818), it was established that once an acceptance is posted by the offeree, there is a binding contract. In this case, Watertankz appears to be a business that deals with items Harry was interested in. After the contact between Harry and Watertankz, Watertankz made an explicit offer by telling Harry that they had the tanks he wanted and showed him how to make the purchase. This is a valid offer and Harry had the right to follow it up with an acceptance or not. Making such an offer in itself is an intention to create a legal relationship. According the the elements of contract law, Harry accepted the contract and this created a binding contract which effectively prevents Watertankz from revoking the contract without penalties. This is because according to the postal rule, an acceptance is made hence a binding contract is formed the moment an offeree posts his acceptance to the offeror. This therefore means that Harry gained legal rights the moment he mailed his acceptance to Watertankz. The offer made by Watertankz was accepted by Harry. This means that it is not legal for Watertankz to revoke the contract or opt out without incurring damages. The fact that prices are rising is not material in this sense. This is because Watertankz made the offer as an informed party and in this case, the concept of caveat emptor which requires them to be