1. Smith v.

Hughes (meeting of minds)

- Plaintiff offered to sell oats to defendant, and a sent a sample of said oats to him.
The defendant took the sample and wrote to the plaintiff saying that he would
accept the oats. When the oats were delivered to the defendant, he refused to
accept them, saying that he thought he was buying old oats, but these oats were
new, and so he had no use for them
- The court held that Hughes had no right to reject the order. Although there was no
meeting of minds regarding the age of the oats, there was a meeting of minds as to
the sale and purchase of the oats.
- “It is essential to the creation of a contract that both parties should agree to the
same thing in the same sense.”

2. Storer v. Manchester City Council (offer, acceptance)

- A new city Council refused to proceed with the sale of a plot of land to a tenant
(plaintiff). The sale had been arranged by the previous council. The plaintiff had
signed the form sent to him by the council and left only the date when the lease
would be over and his mortgage payments would start unfilled.
- Court held that the intention to enter into a binding contract existed on the
plaintiff’s end. Filling the date was a mere administrative formality. A binding
offer existed.

3. Hartog v. Colin and Shields (meeting of minds)

- Colin and Shields were negotiating to sell 30,000 hare skins to Hartog. The price
was being negotiated on a per-piece basis. The offer which Hartog received from
Colin and Shields mentioned the price on a per-pound basis. This made the price
1/3rd of what was being negotiated by the parties. Hartog accepted and claimed the
goods.
- Court ruled that there was an offer and acceptance, but no meeting of minds.
Thus, no agreement had been formed between the parties.

4. Pharmaceutical Society of Great Britain v. Boots Cash Chemist (invitation to

offer)
- In the UK, it was an offence to sell specified pharmaceutical products without the
approval and supervision of a pharmacist. Boots introduced the self-service
system for its customers. The pharmacist was seated next to the cashier to oversee
the sales. The pharmacist could prevent any customer from removing any item
from the shop. Boots was prosecuted by the Pharmaceutical Society of Great
Britain for violating the law for selling the drugs without the supervision of a
pharmacist. The contention was that the contract had been completed by the time
the customer came to the counter where the pharmacist sat.
- Issue: Where, when, and by whom the offer is made in a self-service store?
- Court held that the offer is made by the customer when they reach the cashier and
the cashier still must accept the offer in order for the contract to be complete.
Hence, Boots not liable.

5. Fisher v. Bell (invitation to offer)

 - In the UK, it was an offence if anyone ‘manufactures, sells…or offers for sale’
flick knives. The police found a flick knife in the display window of Bell’s shop.
On being asked, Bell passed the onus onto the manufacturers, saying they only
gave it to shops to sell.
- Court held that Bell was not guilty of the offence, as displays in shop windows are
only ‘invitations to offer’, not ‘offers.’

6. Dickinson v. Dodds (revocation of offer)

- Dodds signed and delivered to Dickinson an offer to sell a house that ended: “P.S.
– This offer to be left over until Friday, 9AM…12th June, 1874.” Dickinson had
decided to accept the offer, but did not do so as he thought he had time till Friday
9AM to decide. The offer was revoked by Dodds by the time Dickinson accepted.
Dickinson sued.
- Court held that there was no enforceable contract. There was no consideration
provided by Dickinson to Dodds to keep the property unsold till 9AM. Therefore,
it was not a binding offer. It was a ‘bare promise.’

7. Mcpherson v. Appana (invitation to offer)

- The plaintiff offered to purchase a lodge owned by defendants for Rs. 6000. He
wrote to the defendant’s agent, asking whether his offer had been accepted and
saying that he was prepared to accept any higher price if found reasonable. The
agent replied: “Won’t accept less than Rs. 10,000.” The plaintiff accepted this and
brought a suit for performance of the contract.
- Court held that the defendant did not make an offer or counter-offer but was
merely inviting offers. There was no assent to the plaintiff’s offer to buy at Rs.
10,000 and, therefore, no concluded contract.

8. Lalman Shukla v. Gauri Dutt (communication of offer, general offer)

- Gauri Dutt’s nephew absconded from his home in Kanpur. He could not be found
for several days. Gauri Dutt gave money to his servants for railway fare and other
expenses and sent them to different places to search for the boy. Lalman Shukla,
one of the servants, was sent to Haridwar. After the servants had left, Gauri Dutt
issued handbills offering a reward of Rs. 501 to anyone who finds the boy. He
sent some handbills to Lalman Shukla as well. Lalman found the boy and brought
him back. Dutt gave him a reward of Rs. 20. Lalman sued for the Rs. 501.
- Court held that the handbill was a unilateral offer made to the world at large. An
offer can be accepted only if knowledge of the offer exists. Handbills were sent to
Lalman and thus he had knowledge of the offer. Since, performance of the
conditions of a proposal amounts to acceptance, finding of the boy amounted to
acceptance. Thus, a contract was created. However, performance of a duty arising
from a contract cannot be consideration for another contract between the same
parties. Thus, since Lalman was already duty bound by way of his employment to
find the child, this was not valid consideration for the second contract through the
offer put up by the handbill.
9. Carlill v. Carbolic Smoke Ball Company (offer, invitation to offer, general offer,
unilateral offer)
- Carbolic Smoke Ball Ltd manufactured a device for dispensing medicine for the
prevention of cold and influenza called a Carbolic Smoke Ball. The company
published an advertisement announcing a reward of 100 pounds to anyone who
contracted influenza, a cold or any other such disease after having used the
medicine thrice daily for 2 weeks. They also mentioned that they had deposited
1000 pounds with the Alliance Bank, Regent Street as a display of their sincerity
in the matter. Edina Carlill bought a Carbolic Smoke Ball and used it as directed
for 2 months. She contracted influenza, anyway. She claimed 100 pounds from
Carbolic. The company refused to pay, saying that the advertisement was vague
and uncertain and thus not an offer capable of being accepted.
- Court held that the advertisement was an offer as the terms were stated expressly
and in detail. The firm’s act of depositing the money acted as proof of sincerity in
delivering on their promise.
- The essence of the case is that an advertisement is only a communication. What is
being communicated must be assessed to decide if it is an offer or not.

10. Ramsgate Victoria Hotel Company Ltd. v. Montefiore (lapse of offer)

- Montefiore applied for allotment of shares, with a deposit of 50 pounds, to
Ramsgate Victoria Hotel Company. The company allotted him shares after 6
months. He said that a long silence from the company amounted to rejection of the
offer. He rejected the share allotment.
- Court held that as the shares were not allotted within a reasonable time, he was not
bound to accept the shares.

11. Hyde v. Wrench (counter-offer)

- Wrench offered to sell his farm to Hyde for 1000 pounds. Hyde wrote back,
offering to buy the house for 950 pounds. Wrench wrote back saying he could not
accept the offer. Hyde responded by communicating acceptance of the original
offer for 1000 pounds. Wrench received the communication, but was no longer
interested. A dispute arose as to whether an agreement had been formed by
Hyde’s acceptance of the offer
- The court held that Hyde’s second communication of 1000 pounds was a counter-
offer, which had to be accepted by Wrench. The original offer no longer existed.
The acceptance has to be a mirror image of the offer (mirror image rule)

12. Felthouse v. Bindley (Silence as a form of acceptance)

- Felthouse was negotiating with his nephew, John, for the sale of a horse. He wrote
to John, ‘If I hear no more about him, I consider the horse is mine at 30 pounds 15
cents.’ John did not send any reply. Six weeks later, John instructed an auctioneer,
Bindley, to sell his farming stock. The horse was also catalogued as farming stock.
John told the auctioneer that the horse was already sold. The auctioneer
inadvertently sold the horse and later acknowledged his mistake in doing so.
Felthouse claimed that Bindley should restore the horse back to him as it was his
property.
 - The court held that although it was clear that John wanted to sell the horse to
Felthouse, he had not communicated his intention to his uncle or done anything to
bind himself.
- Silence does not amount to acceptance. A party must make a positive act to
constitute acceptance. No obligation can be imposed on another party to accept or
refuse.

13. Brogden v. Metropolitan Railway Co. (acceptance through conduct)

- Brogden had been supplying coal to Metropolitan Railway Co. without any formal
agreement. Brogden suggested that a formal agreement should be drawn up. The
agents of both parties met and drew up a draft agreement. It had some blanks
when it was sent to Brogden for his approval. He filled up the blanks and returned
it to Metropolitan Railway Co. The agent of the company put the draft in his
drawer and it remained there without final approval having been signified.
Brogden kept up his supply of coals but on the new terms and also received
payment on these terms. A dispute arose. Brogden refused to be bound by the
agreement.
- Court held that final acceptance was clearly given when the company acted in
accordance with the terms of the new contract and Brogden responded similarly.

14. Adams v. Lindsell (1813) (Postal rule)

- On Sept. 2, the defendants sent a letter offering to sell a certain quantity of wool to
the plaintiffs. The letter added “receiving your answer in course of post.” The
letter reached the plaintiffs on Sept. 5. On that evening, the plaintiffs wrote an
answer agreeing to accept the wool. This was received by the defendants on Sept.
9. The defendants waited till Sept. 8 for the acceptance, and having not received it,
sold the wool to other parties on that date. Plaintiff sued for breach of contract.
Defendants said that until the plaintiffs’ answer was actually received, there could
be no binding contract and thus they were free to sell the wool on the Sept. 8
- The court held that a complete contract arises on the date when the letter of
acceptance is posted.

15. Byrne v. Van Tienhoven

- On October 1st Van Tienhoven mailed a proposal to sell 1,000 boxes of tin plates
to Byrne at a fixed price. On October 8th, Van Tienhoven mailed a revocation of
offer, however that revocation was not received until the 20th. In the interim, on
October 11th, Byrne received the original offer and accepted by telegram and
turned around and resold the merchandise to a third party on the 15th. Byrne
brought an action for non-performance.
- Court held that the revocation of the offer was not effective until it had been
communicated to Byrne. While the postal rule remains good law for acceptance,
he finds no support for the premise that revocation of an offer is also completed
once it has been put in the mail. As a result, the revocation was not communicated
to Byrne until the 20th, at which point the contract was already formed and thus
the revocation is of no effect.
16. Ramdas Chakrabarti v. Cotton Ginning Co. Ltd.
- Cotton Ginning Co. claimed to have posted a letter of allotment of shares to
Ramdas. However, Ramdas denied receiving it.
- The Court held that a contract is concluded at the place from where the proposal is
accepted and communication of acceptance is dispatched. Whether or not the
letter was received is immaterial

17. Entores Ltd. v. Miles Far East Corporation (email and postal rule)
- Entores Ltd was a company registered in England, with its registered office in
London. Miles Far East Corporation was a company registered in the USA, with
its headquarters in New York. The Miles Corporation had agents all over the
world. In Sept. 1954, a series of communications passed between Entores and an
agent of Miles Corporation based in Amsterdam. This communication took the
form of telex, a system which ensured almost instantaneous communication, much
like a telephone. Entores made an offer to buy 100 tons of cathodes at a price of
239 pounds per ton to the agent of Miles in Amsterdam. The agent accepted the
offer. The parties later had a dispute on the contract.
- Issue: should the case be taken up in London or Amsterdam. This question
depended on resolving the place of formation of the contract.
- Court held that where the communication is interactive and spontaneous, whether
face-to-face or through telex, the ordinary rule that the offeror must receive the
acceptance would apply. The postal rule would apply only in cases where post is
used. Email is like a letter delivered to the other party. It is not an interactive
means of communication. Therefore, the postal rule would apply to
communication by email.

18. Butler Machine Tool Company Ltd v. Ex-Cell-O Corporation Ltd (counter-
offer)
- An offer to sell a machine contained a price variation clause, which stated that it
was a condition of acceptance that goods would be charged at prices ruling at the
dates of delivery. The offeree placed an order for the machine in their form which
did not contain any variation clause and which had a tear-off acknowledgement
slip. The offerors signed and returned the slip. The machine was ready for
delivery by September but the buyers could not accept it until November. The
sellers invoked the price variation clause.
- Court did not permit them to do so. It held that the buyer’s order was not an
acceptance, but a counter-offer, which the sellers accepted. It contained no price
variation clause.

19. R V Clarke (acceptance through performance)

- The government of Australia had announced a reward of 1000 pounds for ‘such
information as shall lead to the arrest and conviction of the person or persons who
committed the murders’ of 2 police offers. Clarke was himself arrested and
accused of one of the murders. Clarke provided information that led to the
conviction of those responsible for the murders. Clarke claimed the reward of
1000 pounds
 - Court held that Clarke had acted ‘exclusively in order to clear himself from a false
charge of murder.’

20. Holwell Securities Ltd v. Hughes (postal rule, acceptance)

- The offer documents required that written acceptance must reach the offeror. The
acceptance letter was lost, but the acceptor could establish dispatch of the
acceptance. The acceptor claimed that, following the postal rule, a contract was
formed the moment the letter was posted.
- Court held that the postal rule did not apply as the parties had decided that
acceptance must reach offeror for a contract to be formed.

21. Errington v. Errington (acceptance through performance)

- Errington bought a house for his son and daughter-in-law to live in. The total
value of the house 750 pounds. Errington paid 250 pounds in cash and borrowed
500 pounds from a building society on the security of the house. Errington was
required to pay 15s to the building society every week as way of repaying the
loan, with interest. He took the house in his own name and told his daughter-in-
law that the 250 pounds was a gift to them and they must pay the building society
instalments of 15s each week, themselves. He promised that he would transfer the
house to their names when he retired. She paid the instalments regularly and much
of the mortgage was repaid. Errington passed away, leaving behind all his
property by will, including the house which was in his name, to his wife.
However, the daughter-in-law continued to pay the instalments to the building
society. After Errington’s death, the son went to live with his mother as she
needed him. His wife refused to live with the mother. His mother filed a case to
evict her daughter-in-law from the property.
- Court held that the father’s promise was a unilateral contract – a promise of the
house in return for their act of paying the instalments. It could not be revoked by
him if the couple completed performance of the act, but it would cease to bind him
if they left it incomplete and unperformed. If this was the position during his
lifetime, it must be the same after his death. If the daughter-in-law continues to
pay all the instalments, the couple will be entitled to have the house as soon as the
mortgage is paid off. However, if they fail to do so, the father’s estate will have to
pay the rest of the instalments. Although the agreement would get formed only
when all the instalments are paid, the offer cannot be withdrawn once the action
towards the formation of the contract has begun.

22. Bhagwandas Goverdhandas Kedia v. M/s. Girdharlal Parshottamadas and Co.

(place of formation of contract in telephonic communication)
- The plaintiffs made an offer from Ahmedabad to the defendants at Khamgaon to
purchase certain goods and the defendants accepted the offer.
- Issue: whether the conversation resulted in a contract at Khamgaon or at
Ahmedabad
- Court held that since it was a telephonic conversation, the postal rule did not
apply. The communication becomes complete when the acceptance is received by
the offeror.
23. Tweddle v. Atkinson (privity of contract)
- The father of the bride and groom in a marriage entered into an agreement that
they would each pay the couple a sum of money. The father of the bride died. The
groom made a claim for the money.
- Claim failed. It was held that the groom was not party to the agreement. No
consideration moved from his side. Therefore, he was not entitled to enforce the
contract.

24. Chappel and Co. Ltd v. The Nestle Co. Ltd (sufficiency of consideration)
- Nestle, a chocolate manufacturer, came up with an advertisement scheme where
they offered to supply any one of six gramophone records for a postal order of 1s.
6d. and three chocolate wrappers. The manufacturers made the records and sold
them to Nestle for 4d, each. Thus, while the objective was to advertise their
products, Nestle ended up making a profit. The wrappers that they received were
thrown away. The copyright law of England provided for the reproduction of
musical work without infringing copyrights. A person intending to make a
reproduction of a musical work could give a notice of intention to make a
reproduction for retail sale. The party making the reproduction had to pay a
royalty. Chappel & Co., the copyright owners, refused to grant a license to
reproduce the musical work. They said that as wrappers were demanded, it was
not a retail sale. A sale is a special form of contract where the consideration for
the seller is the price in cash.
- Issue: Can something ‘worthless’, like empty wrappers, be considered valid
consideration?
- Court held that wrappers were consideration. The acquisition of the 3 wrappers
that had to be sent to Nestle required expenditure by the acquirer, which he may
not have otherwise incurred.

25. Ramachandra Chintaman v. Kalu Raju (pre-existing duty as consideration)

- Ramachandra Chintaman was a lawyer representing Kalu Raju. Kalu Raju paid
the full fee for his lawyering services. Later, Kalu Raju entered in an agreement
with Chintaman, promising to pay him Rs. 61 as a reward if he won the case or
negotiated an amicable settlement. The case got settled in Kalu Raju’s favour.
However, he refused to pay Chintaman the promised reward. Chintaman made a
claim for the reward.
- The court held that the agreement for the reward was being executed without any
consideration. Kalu Raju was already bound to render his best services as a part of
the existing contract. There was no fresh consideration flowing from him. He
could not be more firmly bound by the reward to render his best services than he
already was.
- A pre-existing duty of a person can be consideration for another contract with a
third party. A pre-existing duty cannot be a consideration for another agreement
between the same parties. An agreement to change the terms of an existing
contract may not be binding if the second agreement is not supported by new
consideration.
26. Pao On v. Lau Yiu Long (pre-existing duty as consideration)
- Fu Chip Investment Co Ltd, a public company majority-owned by Lau Yiu Long,
wished to purchase a building owned by Tsuen Wan Shing On Estate Co Ltd,
whose majority shareholder was Pao On. Instead of selling the building for cash,
Lau and Pao did a swap deal for the shares in their companies - Tseun Wan would
get 4.2m $1 shares in Fu Chip, and Fu Chip bought all the shares of Tsuen Wan.
To ensure the share price of Fu Chip suffered no shock, Pao agreed to not sell
60% of the shares for at least one year. Also, in case the share price dropped in
that year, Lau agreed to buy 60% of the shares back from Pao at $2.50. Pao then
realised, if the share price rose over $2.50 in the year, the price would stay fixed
and he would not get the gains so he instead demanded that Lau would merely
indemnify Pao if the share price fell below $2.50. Pao made clear that unless he
got this "guarantee agreement", he would not complete the main contract.
Subsequently the shares did fall in value and Pao tried to enforce the guarantee
agreement. Lau argued the guarantee agreement was not valid (1) because there
was no consideration, only in the past and under a pre-existing duty, and (2)
because it was a contract procured by duress.
- Court held that a promise to perform a pre-existing contractual obligation to a
third-party can be good consideration. There was no economic duress. For
economic duress, it must be shown that the victim’s consent to the contract was
not voluntary.

27. Stilk v. Myrick

- Early 1800s
- Stilk, a seaman, agreed to sail from London to the Baltic Sea and back on a vessel.
When the vessel arrived at an intermediate port, two seamen deserted the vessel.
The captain of the ship failed to find sailors to replace these 2 men. The captain
told the rest of the crew that if they worked the ship back to London, he would
divide between them the pay that would have been due to the 2 deserters. On their
arrival at London, this extra pay was refused. Stilk brought up the case the recover
extra wages.
- Court held that this extra money need not be paid. The promise of the captain to
pay extra wages lacked consideration. Stilk was already under a duty to work the
ship till it returned to London. Before the seamen sailed from London, they had
already undertaken to do all they could under the emergencies of the voyage. They
had sold all their services till the voyage was to be completed. The desertion of a
part of the crew is to be considered an emergency of the voyage as much as their
death. Those who remain are bound by the terms of their original contract to exert
themselves to their fullest capability to bring the ship in safety to her destined
port.

28. Williams v. Roffey Bros and Nicholls Ltd (‘practical benefit’, consideration)
- A sub-contractor, midway, claimed that he would be unable to complete some
carpentry work he had undertaken. The contractor agreed to pay more for the
 same work as he would have incurred a penalty if the completion of the project
were delayed. He later refused to pay this extra amount to the sub-contractor.
- Court held that there was consideration in this case and thus Roffey Bros. would
be obligated to give Williams the extra sum promised to him. The court diluted
the concept of consideration here, stating that if, in practice, the party obtains a
benefit or avoids a harm, this is enough satisfaction enjoyed by the party for there
to exist valid consideration

29. Kedar Nath Bhattacharji v. Gorie Mahomed (promissory estoppel)

- A trust was created in order to raise a subscription towards building a town hall in
Howrah. When the subscription list reached a point, the commissioners entered in
a contract with a contractor for the construction of the hall. A person had put
down his name in the subscription list. He refused to pay the money
- Issue: could the money be recovered from him or not?
- Court recognized that subscription to a charitable object would not have
consideration. However, this was not the case here. Here, the people who
subscribed knew that on the faith of their subscription, an obligation was to be
incurred to pay the contractor for the work. The consideration here is the promise
to ensure that this building is built.
- The difference between this case and other cases of donation is that here the
money was being raised for a specific purpose.

30. Currie v. Misa (consideration)

- Defined consideration: “A valuable consideration in the sense of the law may
consist either in some right, interest, profit, or benefit accruing to one party, or
some forbearance, detriment, loss, or responsibility given, suffered or undertaken
by the other.”
- Consideration in terms of benefit and detriment to parties

31. Thomas v. Thomas (sufficiency of consideration)

- John Thomas had bequeathed his property to his relatives in his will. On his death,
his house became their property. John Thomas had desired that his wife, Eleanor
Thomas, should have the use of the house. The relatives had a written agreement
with Eleanor Thomas to this end. The agreement gave her full use of the house,
furniture and the property. It mentioned that she would pay a sum of 1 pound as
rent and maintain the premises properly. In spite of this, the relatives refused to let
her occupy the premises. They held that there was no consideration in the
agreement. The only consideration was John Thomas’ desire that his widow
should be in possession of the premises.
- The court held that there was valid, sufficient consideration. Mere respect for the
memory and wishes of a person cannot be viewed as consideration. However, the
undertaking to pay the 1 pound rent was sufficient consideration.

32. D&C Builders v. Rees (consideration)

- The plaintiff had a claim of 480 pounds against the defendant. He was in
desperate financial straits. The defendant was aware of this. Exploiting this
 knowledge, the defendant offered to pay the plaintiff only 300 pounds in full
satisfaction of the debt, which the plaintiff accepted. The payment was made by
the defendant’s wife. Plaintiff said this payment was accepted as they had no
choice but to accept due to their dire financial state
- The court allowed the plaintiff to recover the remaining 180 pounds as there was
no consideration for the settlement and the defendant had acted inequitably

33. Hughes v. Metropolitan Railway Co.

- Hughes owned property leased to the Metropolitan Railway Company. Under the
lease, Hughes was entitled to compel the tenant to repair the building within 6
months of notice. Notice was given. Metropolitan Railway Co sent a letter
proposing to purchase the building from Hughes in the period in which they were
meant to complete the repairs. Negotiation begvan and continued for a month.
Nothing was settled. Once the six month period elapsed, Hughes sued
Metropolitan Railway Co for breach of contract and tried to evict them. The tenant
completed the repairs 2 months after the 6 month period.
- Issue: Was there an implied promise that the 6 month term would be suspended
during the negotiations?
- The court held that the time limit for carrying out the repairs was suspended
during the negotiations. If parties enter into a negotiation, which has the effect of
leading one party to suppose that the strict rights arising under the contract will
not be enforced, or will be kept in suspense, the person who otherwise might have
been able to enforce those rights will no longer be allowed to enforce them

34. Central London Property Trust v. High Trees House

- In 1937, High Trees House leased a block of flats for a rate £2,500/year from
Central London Property Trust. Due to the war, and the resultant heavy bombing
of London, occupancy rates were drastically lower than normal. In January 1940,
to ameliorate the situation, the parties made an agreement in writing to reduce rent
by half. However, neither party stipulated the period for which this reduced rental
was to apply. Over the next five years, High Trees paid the reduced rate while the
flats began to fill and by 1945, the flats were back at full occupancy. Central
London sued for payment of the full rental costs from June 1945 onwards.
- The court ruled in favour of Central London. A party who waives a part of the
performance of a contract may later re-instate that portion if it would not be unjust
or violate the reliance of the other party. The court reasoned that the rent waiver
was only meant to cover the wartime period. Therefore, it was not unjust to raise
the rent back to the original amount after the war, when the defendant was able to
pay it again. A party who has made a waiver affecting an executory portion of the
contract may retract the waiver by reasonable notification received by the other
party that strict performance will be required of any term waived, unless the
retraction would be unjust in view of a material change of position in reliance on
the waiver.

35. Durga Prasad v. Baldeo (consideration)

 - Durga Prasad, at the request of the District Collector, claimed to have developed a
market place at his own expense. The land must have belonged to the government.
Almost 100 people occupied the shops. Durga Prasad got a written agreement
with the occupants of the shops to pay him a commission on the value of the
goods sold. The dispute in the case was whether these agreements were
enforceable
- The court held that the only ground for making the promise is the expense
incurred by the plaintiff in establishing the market place. This was, however, not
at the desire of the defendants, and thus do not hold as consideration. Durga
Prasad did not do this for the benefit of the shopkeepers, but rather to please the
Collector. There was no consideration between Durga Prasad and the shopkeepers.
Consideration must only flow at the desire of both promisors

36. Chinnaya v. Venkataramaya (privity of contract, consideration)

- Chinnaya was granted her mother’s share of land by her mother, through a
registered deed of gift. Her mother was providing benefits to her brothers from the
land. She made it a condition of the gift that her daughter would continue to
provide the benefits to her brothers. On the same date as she signed the deed of
gift with her mother, Chinnaya executed an agreement in favour of her uncles to
carry out the terms of the deed of gift. Chinnaya refused to fulfil her promise, and
her uncles moved the court for claims in the agreement made by Chinnaya.
Chinnaya held that there was no consideration for the agreement and the brothers
had no right to sue.
- The court held that the deed of gift in favour of the daughter and the agreement
between the daughter and her uncles may be regarded as one transaction. There is
sufficient consideration for the daughter’s promise.

37. Nawab Khwaja Muhammad Khan v. Nawab Husaini Begam (privity)

- Husaini Begum claimed a certain allowance called Kharch-i-pandan from her
father-in-law under the terms of an agreement between him and her father, prior to
and in consideration of her marriage with his son. Both she and her husband were
minors at the time the agreement was formed
- Court held that she could recover the money even though she was a third party to
the contract.
- “In India and among communities circumstanced as Mohammedans, among
whom marriages are contracted for minors by parents and guardians it might
occasion serious injustice if the common law doctrine was applied to agreements
or arrangements entered into in connection with such contracts.” This statement
has been taken by some High Courts as laying down the rule that Indian courts are
not bound by the rule in Tweddle v. Atkinson.
- The SC has expressed itself in favour of the rule in Tweddle v. Atkinson.

38. MC Chacko v. State Bank of Travancore

- A bank had an overdraft with the State Bank of Travancore. Chacko was the
manager of the bank and his father had guaranteed the repayment of debt to State
Bank of Travancore. Chacko gifted his properties to his family members. The gift
 deed provided that the liability, if any, under the guarantee should be met by Chacko
either from the bank or from the share of property gifted to him. The State Bank of
Travancore tried holding Chacko liable under this provision.
- The Court said he could not be held liable, as the State Bank was not a party to the
deed or bound by the deed. It could not enforce the deed as no stranger to a contract
can enforce the terms of the contract
- Held that a person not a party to a contract cannot, subject to certain well recognized
exceptions, enforce the terms of the contract. The recognized exception mentioned
in the quoted judgment is worded widely so as to cover the beneficiaries under the
terms of the contract.

39. Rose Fernandez v. Joseph Gonsalves (privity)

- The plaintiff’s father entered into an agreement with the defendant that he would
marry her.
- Court held that the girl could sue the defendant for damages for breach of the
promise of marriage. The defendant was not allowed to take the plea that the girl
was not a party to the contract.

40. Delhi Cloth and General Mills v. Union of India

- Established that in order to assert promissory estoppel, all that needs to be
established is that the party asserting estoppel must have acted upon the assurance
given to him as he relied on this assurance. The party must have changed or altered
his position by relying on the assurance. It is not necessary to prove any further
detriment or damage to the party asserting the estoppel

41. Debi Radha Rani v. Ram Dass (forbearance to sue is valid consideration)
- A wife who was ready to sue her husband for maintenance agreed to abstain in
exchange for her husband’s agreement to pay her monthly allowance.
- The Court held that this was valid consideration
- The forbearance to sue is recognized as valid consideration.  It is a form of
abstinence which is recognized as good consideration

42. White v. Bluett (nominal consideration)

- The defendant owed a sum of money under a promissory note to his father. The
defendant perpetually complained to his father that he had not been treated equally
with the other children in the distribution of the father’s property. The father
promised to discharge him from all liability with respect to the loan and promissory
note, provided he stopped complaining, which the defendant did.
- Issue: Is the defendant’s promise to stop complaining sufficient consideration?
- The court held that “It would be ridiculous to suppose that such promises could be
binding. In reality, there was no consideration whatsoever.”

43. Rajlukhy Dabee v. Bhootnath Mukherjee (agreement when there is no

consideration)
 - The defendant promised to pay his wife a fixed sum of money every month for her
separate residence and maintenance. The agreement was contained in a registered
document which mentioned certain quarrels and disagreements between the couple.

44. Doraswami Iyer v. Arunachala Ayyar (consideration, bare promise)

- The repair of a temple was in progress. As the work proceeded, more money was
required and to raise this money subscriptions were invited and a subscription list
raised. The defendant put himself down on the list for Rs. 125 but refused to pay
later on. A suit was filed to recover this sum.
- The court did not permit recovery of the money. It was held that the definition of
consideration postulates that the promisee must have acted on something that
amounts to more than a bare promise.

45. Banwari Lal v. Sukhdarshan Dayal (invitation to offer)

- In an auction sale of plots of land, a loudspeaker was spelling out the terms of the
sale. One of the statements made on the loudspeaker was that a plot of certain
dimensions would be reserved for a public inn. Subsequently, that plot was sold for
private purposes.
- The court held that this was allowed. Loudspeakers/microphones are generally used
as an advertising tactic, not to make binding promises.

46. Balfour v. Balfour (intention to contract)

- Husband and wife. The defendant and his wife were enjoying leave in England.
When the defendant was due to return to Ceylon, where he was employed, and his
wife was advised, due to ill health, to stay on in England. The defendant agreed to
send her 30 pounds a month for the probable expenses of maintenance. He sent this
amount for some time, but afterwards differences arose which resulted in their
separation. He stopped sending this money. The wife filed to recover this money.
- The court held that the husband was not contractually bound to send her this money.
There are agreements between parties that do not result in a contract. One such is
agreements made between husband and wife. They are not contracts because the
parties did not intend for there to exist any legal consequences.

47. Merritt v. Merritt (intention to contract)

- Spouses were separating. The court decided that the arrangement they had entered
into for the subsequent payment of the mortgage of the house they occupied was
binding. It cannot always be assumed that families do not intend to create legal
relations/obligations.

48. Tool Metal Manufacturing v. Tungsten Electric

- Tool Metal Manufacturing was entitled to a fixed rate of compensation depending
upon the quantity of material consumed by Tungsten Electric. As a new agreement
was under preparation, Tungsten Metal Co. told the other company that they would
not claim compensation in the meantime. Tungsten Electric did not accept the new
agreement Tool Metal Manufacturing sought to restore its right to compensation.
 - The court held that this right could be restored as, if a party has suspended his
normal rights under a contract, he can at any time, by giving reasonable notice to
the other party, resume these rights.

49. Crabb v. Arun District Council

50. Coward v. Motor Insurance Bureau (intention to create legal relations)

- Coward was killed whilst riding pillion on a motorcycle driven by a friend and work
colleague on the way to work. The collision was due to the negligence of the friend.
Coward's widow sought to claim damages from the Motor Insurance Bureau since
the rider's insurance did not cover pillion passengers. The Motor Insurance Bureau
would only be obliged to pay if insurance for the pillion was compulsory. Insurance
was only compulsory for pillions if they were carried for hire or reward. Coward
paid the friend a small weekly sum to take him to and from work each day. The
widow therefore argued that this was a contract for hire or reward. The MIB argued
that to amount to a contract for hire or reward there had to be an intention to create
legal relations which was absent in agreements of this nature between friends.
- The court held that there was no contract of hire or reward as it was a social and
domestic agreement and therefore no intention to create legal relations. The widow
was therefore not entitled to compensation.

51. Dunlop Pnuematic Tyre Company v. Selfridge & Co (privity)

- Dunlop sold certain goods to Dew & Co and secured an agreement from them not
to sell the goods below the list price and that if they sold the goods to another trader
they would obtain from him a similar undertaking to maintain the price list. Dew &
Co sold the goods to Selfridge & Co, who agreed not to sell the goods to any private
customer at less than the list prices. Dunlop sued Selfridge for breach of this
contract.
- Court held that since no consideration moved from Dunlop to Selfridge, the contract
was unenforceable.

52. Raghunath Prasad v. Sarju Prasad (undue influence)

- A property was mortgaged and a loan was taken on it. On failure to pay the annual
interest, the interest was to be added to the principal amount and then interest was
calculated (compounded interest). In eleven years, the amount escalated eleven
times. The interest rate was very high. It was argued before the court that the
contract was unreasonable and must be rectified.
- Court held that for undue influence to be established the relations of the parties to
one another must be such that one is in a position to dominate the will of the other.
Once this has been established, the onus to prove that the contract was not
established as a result of undue influence is on the party who has the ability to
dominate the will of the other.
- The court has to establish first that one party was in a position to dominate the will
of the other. Next, that the position of power and domination was used and third
that this use of power resulted in an unfair transaction.
 - Thus, Court held in this case: no undue influence as this relationship not established

53. Subhash Chandra Mushib v. Ganga Prasad Mushib (Undue influence)

- A person gifted a significant amount of his property to his grandson. Other family
members sought to set aside the gift on the grounds that it was given under
conditions of undue influence.
- Court said that there are certain relationships which are inherently fiduciary (e.g.
solicitor-client, spiritual advisor-devotee, medical attendant-patient, parent-child).
Other relationships may also be fiduciary, depending on the facts. A relationship
must be proved to be fiduciary before the court. If this is not established, the court
does not assume the relationship to be so.
- Held: no relationship was established, thus no undue influence.

54. Central Inland Water Transportation Corporation Limited v. Brojo Nath

Ganguly (undue influence)
- Brojo Nath Ganguly was an employee of Central Inland Water Transportation Co.
His services were terminated by a three-month notice from the corporation. The
constitutional validity of this termination was questioned before the court.
- Court held that excessive and arbitrary powers in the hands of the employer to
terminate services of an employee without assigning any reason was coercive and
opposed to public policy. It is unreasonable.

55. Hammond v. Osborne

-

56. Allcard v. Skinner

-

57. Williams v. Bayley (actual undue influence)

- A son forged his father’s signature while giving promissory notes to the defendant
bank. When the truth came to light, the bank manager threatened the father that the
bank would prosecute the son if a satisfactory solution was not found. The father
agreed to give an equitable mortgage to the bank on his property in return for the
promissory notes. Later, the father sought to have the agreement cancelled on the
grounds that he was influenced by the threat.
- Court held that the agreement was voidable as the bank had an unfair advantage of
the father and used this position to force an agreement from him.

58. Derry v. Peak (1889) (fraud)

- A company’s prospectus contained a representation that the company had been
authorized by a special Act of parliament to run trams by steam or mechanical
power. The authority to use steam, was, in fact, subject to the approval of the Board
of Trade, but no mention was made of this fact in the prospectus. The Board did not
approve. The plaintiff, having bought shares in the company, sued the directors for
fraud.
 - Court held: no fraud as the company genuinely believed that once Parliament had
authorized the use of steam, the consent of the Board was practically concluded. A
party making a false representation is not guilty of fraud if they honestly believe in
the truth of their claim.
- Defined fraud in English law
- Fraud is proved when it is shown that a false representation has been made (1)
knowingly, or (2) without belief or truth, or (3) recklessly careless whether it is true
or false. Fraud = “intentional misrepresentation”

59. Mohri Bibee v. Dharmodardas Ghose (minor)

- A minor mortgaged houses to a moneylender. The mortgage was executed and the
moneylender paid him the first instalment. Two months later, the mother, as the
guardian of the minor, approached the court, claiming that the mortgage was void
as the son was a minor.
- The Court held that the contract was voidable and declared the mortgage void.
- No relief was given to the moneylender
- The moneylender requested that the loan amount should be restored to him. The
Court held that this was not necessary as a contract with a minor was void ab initio

60. Kunwarlal v. Surajmal (minor – reimbursement for necessities)

- A minor rented a house to live in and carry on his studies. After living in the house
for several months, the minor claimed the contract was void and refused to pay the
rent. The landlord moved the court to recover the rent
- Court held that the provision of the house for the minor to live in and pursue his
studies counted as a supply of necessities suited to the minor’s condition of life.
Therefore, money can be recovered.

61. Nash v. Inman (minor)

- Inman was an undergraduate at a college. Nash, a tailor, supplied him with 13
waistcoats and various other such items for over a year. Inman never paid Nash.
Nash moved court to get his payment.
- It was established in court that Inman was a minor. Held that the goods supplied
were not necessities. One waistcoat might be a necessity, but not 13.

62. Ajudhia Prasad v. Chandan Lal (minor)

- Two minors borrowed money under a mortgage deed. They were over 18 but less
than 21 years of age, but fraudulently concealed the fact that a guardian had been
appointed for them.
- The issue before the court was whether the lender could get a decree for the
principal amount or sale of mortgaged property.
- Held, where property is not traceable, granting a money decree would tantamount
to enforcing minor’s pecuniary (monetary) liability under a void contract –
restitution cannot be provided

63. Raj Rani v. Prem Adib (adult contracting for minor)

 - The plaintiff, a minor, was allotted the role of an actress in a particular film by the
defendant. The agreement was made with her father. The defendant subsequently
allotted the role to another artist and terminated the contract with the plaintiff’s
father. Father sued
- The Court held that neither Raj Rani nor her father could sue. The contract was void
as the promise of a minor to perform a contract was not enforceable against her and
thus there was no consideration flowing from Raj Rani’s father to the producer
64. Gujoba v. Neel Kanth
65. Gopalkrishna v. Tukaram
-
66. Askari Mirza v. Bibi Jai Kishori (Coercion)
- Bibi Jai Kishori gave a loan to Askari Mirza. Later, she claimed to have discovered
that Askari Mirza lied to secure the loan. She threatened to file a criminal case
against him. Kishori and Mirza entered into an agreement following this, whereby
he would immediately give her the money. Askari Mirza claimed that this
agreement had been obtained through coercion (threat to file criminal case)
- Court held that threatening to file a criminal case is not forbidden by the IPC. Only
threatening to file a false case is.
- Established the rule for claims of coercion and what must be established by plaintiff
in such cases – 1) a threat was stated 2) It was a threat to commit an act forbidden
by the IPC 3) The threat was stated with the intention of causing the plaintiff to
enter into the agreement

67. Chikkam Ammiraju v. Chikkam Seshamma (Coercion)

- A person threatened to commit suicide and got his wife to execute a document
transferring property to his brother. Issue before the court: is this coercion?
- Court held that this was not against the IPC as committing suicide is not an offence,
only attempting to commit suicide is an offence. If the husband had attempted to
commit suicide, then the agreement would have been obtained under coercion.

68. Andhra Sugars Limited v. State of Andhra Pradesh (coercion)

- Under the Andhra Pradesh Sugarcane Act, the cane grower in the factory zone is
free to make or not make an offer to sell cane to the occupier of a factory. But if he
makes an offer, the occupier of the factory is bound to accept it. It was claimed that
the agreement was caused by coercion
- The Court held that there was no coercion as no IPC related threat or commission
of act banned by the IPC

69. Universe Tankships Inc. v. International Transport Workers’ Federation

- A shipping company (Universe Tankships) paid $80,000 to the Workers’
Federation under an agreement. The agreement was executed as the workers did not
permit the ship to leave without signature. Universe Tankships wanted to recover
this money
- Universe Tankships was allowed to recover the money as the act of not allowing
the ship to leave unless the agreement was signed amounted to economic duress.
70. Lloyds Bank v. Bundy (undue influence)
- A contractor borrowed a sum of money from a bank. He could not pay back in time.
The banker pressed for payment or for security. He suggested to the contractor that
his father should mortgage his house, which was the family’s only residential house.
The bank officer visited the father and obtained his signatures upon readymade
papers. The contractor could not pay and the banker sought to enforce the mortgage
on the house. Accordingly, Mr. Bundy sought to set aside the mortgage, referring
to its unfair character
- Court set aside the mortgage, held that contracts in which a person’s bargaining
power is grossly inadequate due to pressure, undue influence etc are unfair and
should not be allowed by Courts.

71. Bisset v. Wilkinson (misrepresentation)

- Certain lands were sold. The seller was aware that these lands were for sheep
farming and therefore expressed the opinion that the land had a capacity of rearing
2000 sheep. The land turned out to be unsuitable for sheep farming and the buyer
refused to pay the price
- Held, there is no grounds for the agreement to be avoided. A representation of fact
may be inherent in a statement of opinion. However, this depends on the material
facts of the transaction, the knowledge of both parties, and the relative positions of
the parties. The most material fact was that both parties knew that there had never
been sheep farming carried out on that piece of land before. Thus, the seller’s
expression of opinion should have been regarded as just that.

72. ESSO Petroleum Co. Limited v. Mardon (misrepresentation)

- ESSO set up a petrol pump in a British town and made a forecast of sales. The city
planning authorities did not allow ESSO to have an entrance opening to the mian
road. ESSO did not inform Mardon, who wished to take the petrol pump on rent,
about this. He took the pump on rent and his business failed miserably. ESSO
argued that there was no misrepresentation here as the sales forecast was just to be
viewed as a statement of opinion
- Court held that ESSO had special knowledge and skill as they had much experience
and knowledge regarding petrol pumps at their disposal. The sales estimate they
made was made with this special knowledge and skill. They had a duty to Mardon
to ensure that the representation made by them was accurate. They were negligent,
hence, liable.

73. Leaf v. International Galleries

- A picture was sold, the seller representing that it was by John Constable. It turned
out, 5 years later, when the buyer took the picture to an auction, that it was not by
John Constable. Buyer claimed misrepresentation
- This was a case of innocent misrepresentation. The Court held that the contract was
voidable. Also held that there must be a reasonable period of time within which an
application to asset aside a contract is put in

74. Cundy v. Lindsay (mistake of identity)

 - A. Blenkarn, who was a resident of a particular address, wrote to Lindsay & Co.
ordering certain goods. The letter mentioned his residential address and it was
signed in such a way as to look like ‘A. Blenkiron & Co.’ Blenkiron & Sons was a
very reputed firm located on the same street as Blenkarn’s residence. Lindsay knew
about this firm and that it conducted business from that street, but did not know the
exact address of the firm. They entered into a correspondence with Blenkarn,
thinking it is Blenkiron & Sons and eventually supplied the goods to Blenkarn’s
address, addressing the goods to A. Blenkiron & Co.
- Court held that there was no contract between the plaintiff and Blenkarn and it was
void on the basis of mistake, as Lindsay intended to contract with Blenkiron & Co.,
a
- However, Blenkarn had sold the goods to Cundy in the normal course of business.

75. Philips v. Brooks Limited (mistake of identity)

- Philips was a jeweller. A customer entered his shop and asked to see some
jewellery. He selected certain pieces and wrote out a cheque for the price of those
pieces. While signing it, he said, ‘You see who I am, I am Sir George Bullough.’
He proceeded to give an address. Phillips knew that there was a Sir George
Bullough. He quickly checked in a directory and confirmed to his satisfaction that
a Sir George Bullough resided at that address. Phillips let the man take the items
with him before the cheque was cleared. The cheque was dishonoured and it turned
out the person was not Sir George Bullough. The swindler had pledged the ring with
the defendant, who, in good faith, had advanced him 350 Pounds
- Court held that the contract between the swindler and Phillips was not void as
Phillips intended to deal with the person standing in front of him

76. Ingram v. Little (mistake of identity)

- The Ingram sisters and a Mrs. Mary Ann Maud Badger were the joint owners of a
car. They advertised for its sale in the newspapers. A swindler contacted one of the
Ingram sisters, saying that he had seen the advertisement and would like to see the
car. The man came and saw the car. He produced his cheque book but one of the
sisters said they would not take a cheque. He then said he was Mr. PGM
Hutchinson, and that he lived at Stanstead House, Standead Road. On being told
this, one of the sisters went to a nearby Post Office and checked in the telephone
directory and found that there was such a person living at the address. The sisters
took the cheque but it was later dishonoured. By that time the rogue had already
sold to the defendant.
- The Court held that the contract was lawful as the owners of the car intended on
dealing with the person standing in front of them, not only with the identity they
thought was his
- This decision was criticized as it was held that the identity was in fact crucial to the
deal. Although it did not matter in the initial stages of negotiation, negotiations
eventually came to an impasse when the owners did not wish to sell the car on
reliance of a cheque. Here, the identity of the person became important as it was
crucial in their decision to sell or not sell. Although they were selling to the man in
front of them, they were doing it because of his identity
77. Shogun Finance Ltd. v. Hudson
- A motor car dealer sold a car to a fraudster based on a stolen driving licence that
actually belonged to a Mr. Durlabh Patel. The dealer faxed a copy of the licence
and the hire purchase agreement to the finance company, which had a form the
fraudster had signed using the name of Mr. Patel. The claimant was satisfied with
the credit check and approved the sale. The fraudster paid 10% deposit and took
away the car. The next day he sold the car to Hudson. Later on, after realising the
fraud, the claimant brought a claim in conversion against the defendant.
- The House of Lords, by a majority, held that the claimant was entitled to delivery
of the vehicle or damages for its conversion.
- Court held that, here, the contract was in writing and clearly intended to be entered
in only with Mr. Patel and not the impostor.
- English law has the maxim of ‘you cannot give what you do not have.’  the
impostor did not actually have ownership of the car and hence could not give it to
the defendant.

78. Hartog v. Colin & Shields

- Colin & Shields negotiated to sell 30,000 Argentine hare skins to Hartog. The deal
was based on per-piece basis and the oral and the written communications suggested
such terms at the time of negotiation. However, the final offer from Collin & Shield
mentioned per-pound basis, which made the price 1/3rd of what was being
negotiated by the parties. Hartog immediately accepted the offer.
- The court ruled that there was an offer and acceptance, but no meeting of minds. 
No contract.
- Such cases where a person realizes the other person’s mistake and gets into a
contract to take advantage of the mistake are known as ‘snapping up.’ In such cases,
the Court does not enforce the contract, generally

79. Tarsem Singh v. Sukhminder Singh (mistake of subject matter)

- The buyer believed that the land was being sold at the stated price per bigha,
whereas the seller was selling the land at the stated price per kanal.
- Held, that there was no agreement on the matter of an essential fact and therefore
there was no contract.

80. Rao Rani v. Gulab Rani

- Two women claimed to be married to a dead man. The dispute was regarding which
of them would get his property. The two women reached an agreement where both
their names would be entered as joint owners. In the event that either of them got
married, she would lose her share. One of the women remarried and a dispute arose
regarding the validity of the contract.
- Held, the contract is not void as there was no restraint on marriage – if she agreed
to marry she would be deprived of her rights, this is not instrumental to the contract.

81. Foakes v. Beer

 - Sometimes prompt part payment of a debt may be more beneficial than the payment
of the whole debt, especially where the debtor is doubtful of being able to pay the
entire amount.
- However, this still cannot be permitted wholly. Part payment of a debt must be
supported by some other consideration

82. Thorne v. Motor

83. McLnerny v. Lloyds Bank
84. Occidental worldwide investment
85. Pankhania v London Borough

Extra Cases
1. Gibson v. Manchester City Council (offer)
- Manchester City Council owned houses which it let out to people needing
accommodation. Gibson was a tenant staying in one such house. The City Council
informed Gibson that it was going to repair the tarmac path of the house. The work
had not been taken up as yet. The City Council decided to sell the houses owned by
it to the tenants. It circulated a brochure stating “The City Council are prepared to
 sell freehold…any council house…to the tenant of that house, providing he has been
in occupation of it for at least a year. The Council took the market value of the
houses and gave discounts on the basis of the length of the tenancy. Gibson received
a letter stating he would get a 20% discount on the market value. The letter also
stated, “This letter should not be regarded as a firm offer…If you would like to
make formal application to buy your council house, please complete the enclosed
application form and return it as soon as possible.” Gibson filled up the application
form. However, he had doubts about the price of the house. The Council had not
yet repaired the tarmac, and Gibson did not know whether the price included or
excluded the cost of repair. Gibson signed and completed the form but left the price
blank. He sent the form with a covering letter, mentioning that the repair of the
tarmac had yet to be done. The Council responded saying that the house was valued
at the price quoted in the existing condition and no repairs would be undertaken.
Gibson replied through a letter saying he would like to buy the house. Later, the
political control of the council changed hands. The Council was no longer in favour
of the sale of the Council houses. It directed its officers not to go ahead with the
sale of the houses where the contracts were not concluded. The Council informed
Gibson that they would not be selling him the house. Gibson claimed that an
agreement had been formed between him and the Council.
- Court held that the letter sent by the council with the price was not a contractual
offer capable of being converted into a legally enforceable open contract by
applicant’s written acceptance of it.

2. Perala Krishnayyam Chetti v. G Chettiar (offer, counter-offer)

- The offeror asked the offeree to send him 15-20 bags if areca nuts at once. The
offeree wrote back that it would take him 15-20 days to send the goods. The offeror
did not reply and a month and a half later, the offeree sent the goods. The offeror
did not accept them
- Court held that there was no absolute or unqualified acceptance. It was an order for
immediate supply and offeree had made a counter-offer by asking for 15-20 days’
time. This destroyed the original offer.

3. Roscorla v. Thomas (consideration, promise)

- Roscorla bought a horse from Thomas for 30 pounds, which Thomas was yet to
deliver. Later, Roscrola asked Thomas if the horse was free from ‘vice’ and ‘sound.’
Thomas said yes. Later, a dispute arose regarding the soundness of the horse and
liabilities of the seller
- Issue: Is Thomas liable for the horse’s soundness of mind?
- Court held that here the only promise that resulted from the consideration was to
deliver the horse. There is no other duty imposed upon Thomas. The consideration
would not raise an implied promise by the defendant that the horse was of sound
mind or free from vice.

4. Harvey v. Facey (offer, invitation to offer)

- The Plaintiff telegraphed the defendant, writing “Will you sell us Bumper Hall Pen?
Telegraph lowest cash price.” The defendants responded, also by telegram, “Lowest
 price for Bumper Hall Pen, 900 pounds.” The plaintiff immediately replied, saying
“We agree to buy Bumper Hall Pen for the 900 pounds asked by you.” Defendants
refused to sell the land at that price. The plaintiffs said that by quoting their
minimum price in response to their enquiry, the defendants had made an offer.
- Court held that plaintiffs had asked 2 questions in their telegram – 1) willingness of
plaintiffs to sell the land 2) the lowest price. The defendants answered only the
second question. Did not comment on the first. The last telegram, sent by the
plaintiffs, was an offer. It was not accepted.

5. Vijaya Minerals Pvt. Ltd v. Bikash Chandra Deb (adequacy of consideration)

- Bikash Chandra Deb, a landowner in Orissa, reached an agreement with Vijaya
Minerals for the sale of manganese and iron ore. The written agreement provided
the price at which the ores were to be sold. It was a long term contract, but it did
not provide for any price variation. Deb provided the ores for a few years but later
refused to comply with the contract. The company came before the court to enforce
the contract. Deb said that the price was grossly inadequate and did not even meet
the price of extraction. He said that the contract should be set aside for violation of
Section 25 of the Indian Contract Act as the consideration was inadequate
- The court held that the agreement could not be set aside on grounds that the
consideration was inadequate.

6. Kleinwort Benson v. Malaysia Mining Corporation BHD (intention to contract)

- Malaysia Mining Corporation Metals Ltd (MMC Metals) was a wholly owned
subsidiary of the defendant, MMC BHD. MMC Metals approached the claimant
KB Bank for a loan. MMC Metals was a relatively newly formed company lacking
in the size and resources of MMC BHD. The bank approached MMC BHD asking
if they would act as guarantor for the loan. MMC refused to act as guarantor but
stated that it was their company policy to ensure that their subsidiaries are always
in a position to meet their debts. In reliance of this letter of comfort the bank
advanced money to MMC Metals. MMC Metals subsequently went into
administration having not paid the loan. KB brought an action against MMC BHD
to recover their loss based on the assurance given in the comfort letter.
- Court held that the comfort letter had no legal effect. The fact that MMC BHD had
refused to act as guarantor demonstrated they did not intend to be legally bound.

7. Weatherby v. Banham (acceptance through conduct)

- The plaintiff was the publisher of a periodical called the Racing Calendar. He had,
for some years, supplied a copy of that work, as fast as the numbers came out, to a
Mr. Westbrook. Westbrook died and Banham, the defendant, succeeded to
Westbrook’s property. The plaintiff, not knowing of Westbrook’s death, continued
to send the periodical, as they were published, to Westbrook’s residence. They were
received by Banham’s servant. Banham never offered to return them. Weatherby
sought to recover the price of the calendar for 2 years. Banham argued that there
was no contract between him and Weatherby.
 - Court held that if Banham received the books and used them, he should pay for
them. Even though the books came addressed to the deceased Westbrook, Banham
chose to keep them.
- The offeror offered goods to the offeree by sending the goods to him. The
acceptance of the offer was signified through the offeree beginning to use the goods.
8. King’s Norton Metal Co. Ltd. v. Edridge, Merrett and Co. Ltd. (mistake of
identity)
- A man named Wallis got notepaper printed in the name of Hallam & Co. and
ordered some goods from King’s Nortan Metal Co. Ltd. The letter pad intimated
that Hallam & Co. was in business in a big way, running a large factory and having
several depots. King’s Norton delivered the goods on credit and Wallis promptly
sold them to Edridge, Merrett & Co. Ltd. King’s Norton remained 3unpaid and
demanded that the goods be restored to them
- Court held that King’s Norton intended to contract with the person who wrote the
letters. If there had been a separate identity called Hallam & Co. which King’s
Norton was aware of, then it would be a mistake as to identity