Areas of applicable law: Contract law – Offer – Counter offer:
Main arguments in this case: Request for information is not a counter offer.
In contract law an original offer is destroyed if the offeree has counter offered it, or in another words, the offeree wants to pay or agree on a different term than what the initial offer is asking.
However in the course of making a contract the parties may also have various issues which they like to clarify e.g., delivery estimate or mode of payment etc. Enquiries as such should not be considered as a counter offer and this is what was held in the case of Stevenson Jaques & Co. v. McLean (1880).
Facts of the case: MacLean were iron merchants and they telegraphed Stevenson in which they offered to sell 3800 tons of iron at a price of 40s (shillings) net per ton. The offer was made on Saturday and the offer was open until Monday.
On Monday morning Stevenson telegraphed McLean and asked if McLean would “accept forty for delivery over two months, or if not, longest limit you would allow”.
McLean did not reply back to the enquiry that Stevenson had made and later that day sold the iron to a third party. They then at 1.25 pm telegraphed Stevenson that all iron had been sold. Stevenson in the meantime at 1.34 had sent another telegram to McLean accepting the original offer.
Stevenson sued McLean for breach of contract and the issues before the court were to find out if;
Stevenson’s telegram was an enquiry or was a counter offer. The court held that Stevenson was only making an enquiry and hence the original offer was still available to them which they later accepted.