Question

Principle: When one person signifies to another his willingness to do or abstain from doing anything, with a view to obtaining the assent of that person to such an act or abstinence, he is said to have made a proposal.

Factual Situation: Xavier telegrammed to William, "Will you sell me your house? Telegram the lowest cash price." William also replied by Telegram "The lowest price for my house is ₹30 lakh. Xavier immediately sent his reply consenting to William's telegram by saying "I agree to buy your house for ₹30 lakh asked by you." William refused to sell his house.
Decision

Options

• William cannot refuse to sell the house because the contract has already been made

• William can refuse to sell the house because it was only an invitation to offer and not the real offer.

• It was not a valid offer because the willingness to enter  into a contract was absent  

• None of the above  

Answer 1

William can refuse to sell the house because it was only an invitation to offer and not the real offer.

Explanation:

(a)

William can refuse to sell the house because it was only an invitation to offer and not the real offer is correct, as Xavier 's communication is informal and his telegram saying"I agree to buy your house for 30 lakhs as asked by you" will be considered as an invitation to offer and not as an acceptance of an offer. Thus there is no legally binding contract between them.

(b)

William cannot refuse to sell the house because the contract has already been made is incorrect. Under the given situation William is not bound to sell his house to Xavier as telegram by William stating the lowest price of his house is just an informal quote of the cost of the house and will not be considered as an offer in the eyes of Law. When there is no offer the question of its acceptance does not arise hence there is no contract between William and Xavier.

(c)

It was not a valid offer because the willingness to enter into a contract was absent is incorrect. The question of willingness to enter into a contract does not arise as it is not an offer but just an invitation to offer.

(d)

None of the above is inapplicable.