When is a contract "entered into"? s28 CRA

DullGreyGuy

user1977 said:

DullGreyGuy said:

user1977 said:

DullGreyGuy said:

user1977 said:

ArbitraryRandom said:

My understanding is that the contract is formed (entered into) when the offer has been accepted (i.e. the parties have agreed the terms). It's then 'concluded' when those terms have been met to the satisfaction of both parties. 

No, I would say "concluded" and "entered into" are the same thing. You conclude a contract to e.g. buy a house when contracts are exchanged. Completion (when money and keys are handed over) is a later and separate thing.

in England many offers are made unconditionally yet don't bind a contract when it's accepted. 

I don't see why an offer in England couldn't bind you (if you were careless enough)? There's nothing fundamentally different between English and Scottish contract law on that front.

But it doesn't bind you does it until exchange occurs hence we have gazumping and gazundering which more or less cannot occur in Scotland because things are binding. 

See https://www.gov.uk/buy-sell-your-home/offers. which also calls out that its different in Scotland.

Offer and acceptance will form a contract, it's only "exchange" in normal practice because the solicitors are swapping counterparts of the contract - but there's no legal reason why it has to be done that way.

I appreciate that people use "offer" to mean non-contractual vague verbal conditional things (which happens in Scottish parlance too - people have their offer "accepted" long before it's actually binding in any way), but if I put a written offer to you to buy your English property, and you accept it in writing, why wouldn't it be binding?

No, as above, its a legal requirement for written contracts for purchases of land/property in England which isn't required for buying other classes of assets nor in Scotland for land/property

user1977

MacPingu1986 said:

user1977 said:

DullGreyGuy said:

user1977 said:

ArbitraryRandom said:

My understanding is that the contract is formed (entered into) when the offer has been accepted (i.e. the parties have agreed the terms). It's then 'concluded' when those terms have been met to the satisfaction of both parties. 

No, I would say "concluded" and "entered into" are the same thing. You conclude a contract to e.g. buy a house when contracts are exchanged. Completion (when money and keys are handed over) is a later and separate thing.

in England many offers are made unconditionally yet don't bind a contract when it's accepted. 

I don't see why an offer in England couldn't bind you (if you were careless enough)? There's nothing fundamentally different between English and Scottish contract law on that front.

Not generally - it's the real property specific requirements in E&W that mean contracts for the sale of land have to be in writing (+ other requirements) that create the formal "exchange" that creates the acceptance - prior to which offers can be withdrawn

Writing I get, but what are the additional requirements?

MacPingu1986

There's also a requirement that all terms have to be in one document (or incorporate other docs by reference), the offer doesn't (and for all intents & purposes can't) have all the terms in it - which makes the offer non-binding.

Olinda99

ArbitraryRandom said:

My understanding is that the contract is formed (entered into) when the offer has been accepted (i.e. the parties have agreed the terms). It's then 'concluded' when those terms have been met to the satisfaction of both parties. 

i.e. if I said to you I want your lunch. You say I'll sell it to you for £2.50. I say okay - that's the contract entered into - it's then concluded when I give you £2.50 and you give me your lunch (can you tell I'm hungry... ) 

For online sales, I've seen it argued dispatch is used because until that point there's a good chance no human has seen the order on the seller's side to accept it (contract formation is an active process requiring the participation of both parties). Dispatch is the first tangible and observable act that demonstrates the seller's acceptance. 

you give a good example but you have missed out one important point which is that a contract can have terms and conditions. so you could say yes I will buy your lunch for £2.50 but only when I get my pocket money and if I don't get my pocket money that I don't have to buy your lunch - the latter would be a terms and condition.

thus online retailers say yes I offer you this item and yes you can click pay now and indeed put in your payment details but a term and condition is that a binding contract will not be formed until I dispatch the item ie I can back out at any time prior to dispatch. 

in fact a more accurate way of saying it is that a contract is indeed formed when you buy and put in your payment details in but one of the terms and conditions of the contract formed is that the retailer can back out at any time prior to dispatch.

ArbitraryRandom

Trouble then is you're getting into the realm of when T&Cs conflict with statutory rights and the even murkier waters of 'unfair terms'... contract law is water I enjoy splashing in, but tend to leave it to others to deep dive  

Yorkie1

I still vividly remember contract (retail) law from many years ago. A display of items by a retailer was an Invitation to treat. The prospective purchaser then makes an Offer to buy them. The contract is not concluded until the retailer Accepts the offer (and money / consideration is paid).

user1977

Yorkie1 said:

I still vividly remember contract (retail) law from many years ago. A display of items by a retailer was an Invitation to treat. The prospective purchaser then makes an Offer to buy them. The contract is not concluded until the retailer Accepts the offer (and money / consideration is paid).

The consideration doesn't need to be paid in order for the contract to be formed - there needs to be a consideration in the contract (in English law) but the payment can come later (obviously in most retail contexts it happens to be all at the same time though).

Money_Grabber13579

DullGreyGuy said:

Were it not for such a clause then the website is an offer to contract a sale and the buyer clicking the "buy" button and entering their payment details is the acceptance and consideration (the sellers consideration is a promise to send the goods)

Is that the agreed position legally? When a customer walks into a shop, the items on the shelves with prices attached does not constitute an offer. The customer only makes an offer when they go to the cash desk and offer to pay. Would products on a website not be the same and be considered an invitation to treat, with the customer then making their offer when working through the shopping basket process?