Areas of applicable law: Contract law – Offer and acceptance – Invitation to treat:
Main arguments in this case: An invitation to treat is not an offer but merely an act in negotiation.
The fact of the case: Mr Gibson was a tenant and was renting the property from the council. He later tried to buy the property from the council. He filled out and sent the application form he had received from the council and in response received a letter from the council stating that it might be able to sell the property to him. The cost of the property was stated as £2,180. Mr Gibson asked the council if the selling price could be lower as the path to the protery was in need of repair. The council stated that the price quoted had factored in the condition of the path and hence the price was not negotialbe.
On 18 March 1971 Mr Gibson sent a letter to the council asking to initiate the process for purchasing the property as requested in the application he had sent. However before the process for selling the property could be initiated, the control of the council changed in May 1971 and the council decided not to sell the property to Mr Gibson.
Mr Gibson filed legal case against the council claiming that the letter which the council had sent to him regarding the sale of the council house was actually an offer which he had accepted and asked the council to initiate the purchase. The argument was dismissed by the House of Lords which said that the letter containing the price was merely an invitation to treat and was not an offer.