Validity of Exclusion Clause in Contract Law: A Case Analysis

Contract Law 1
Part 1:
Issue:
The main issue in this case is whether Jack enters into any contract with the Ann in context of
letters posted by the parties.
Law:
Any contract signed by the parties is considers as the valid agreement if such contract include all
the necessary components of the valid contract, and that component is offer, acceptance,
consideration, and intention to create legal relations with each other.
Offer is the expression of willingness or promise given by the offeror to the offeree in exchange
of any doing or doing by the offeree. In other words, it is the communication, which occurred
between the parties in which one party promise the other party to do something or not do
something if other party do or not do something. It must note that there is no particular way
through which offer should be make, which means, offeror can make offer in writing, orally, or
by conduct.
However, some rules related to the offer are sated below:
 Offer must be communicate to the offeree.
 Offer must make in clear words, which means, offer made by offeror must not be vague.
 Offer can make either to the individual or to the world at large (ACL, n.d.).
It is possible for the offeror to cancel the offer, but such right is available to offeror until the time
such offer is not accept by the offeree. In other words, offer can be terminate by the offeror
before it is accept by the offeree. There are number of ways through which offer can be
terminates, and all these ways are define below:
Revocation is the first way through which offer can terminated by the offeror, and as per this
way, offeror can revoke the offer until the time it is not accepts by the person to whom such offer
is make. Person who makes the offer can also cancel the offer yet in those situations also in
which promisor decide to open the offer until the specific date, but it is not possible if such offer
is support by any type of consideration. Revocation of the offer must be communicates to the
offeree properly, otherwise it will not considered as the effective revocation.
Another way through which offer can terminate is rejection, and in this offeree plays the
important role in the rejection. As it is the offeree only, who can rejects the offer, and it is
necessary to note that offeree cannot accept the offer, once it is rejects. However, there are two
way through which offer can be reject and these two ways are direct rejection of the offer, and by
making the counter offer.

Contract Law 2
Counter offer is defines as the new offer, which means, accepting the original offer made by the
offeror on terms which are not similar to the original offer. There is no such rule which states
that difference between the terms of original offer and acceptance must be major, which means
even in case of minor difference, acceptance with modified terms is considers as the counter
offer.
In Hyde v Wrench, (1840) Beav 334, defendant offered the P to sell his land for $1200, but offer
rejected by the plaintiff. Later, defendant made offer to sell the land for $1000, and plaintiff
responded that he would like to purchase the land for $950. Defendant refused this price quoted
by plaintiff, and later plaintiff agreed to pay $1000 for land. Now defendant refused to sell the
land. In this case the main issue was, whether there is any contract between the parties (ACL,
n.d.).
Court held that there was no contract between the parties because P made offer to buy the land
for $950, and this was considers as the counter offer because acceptance was give by modifying
the original terms of the offer. Counter offer was the way through which offer was rejected by
the offeree. In this case, plaintiff made the counter offer and this automatically rejects the
original offer made by defendant. Court further stated that once the offeree rejected the offer,
then it was not possible for offeree to accept it.
In this case, Court consider number of cases for reference, and also stated that in context of
making the acceptance valid, acceptance must be simple and reflect the terms of the original
offer.
Court consider the principles of the case law Holland v. Eyre (2 Sim. & St. 194), and on the basis
of the principles of this case, Court stated that plaintiff made the counter offer instead of
accepting the original proposal. This counter offer ends the original proposal and left the
defendant never accepted proposal made by the plaintiff in the question, and the offer made by
the plaintiff. One more scenario was also considers by the Court that, it was not possible for the
plaintiff to revive the original proposal made by the defendant, without the permission of the
defendant (Baillli, n.d.).
In case law Johnson v. King (2 Bing. 270) & Kennedy v. Lee (3 Mer. 454), Court held that it
was possible for the offeree to accept the offer till the time it was subsisted by the defendant.
Court further stated in case offer made by the offeror was not withdraw before the acceptance of
the offeree then there was valid contract between the parties.
After considering the above facts, it is clear those in case acceptance is give without the actual
terms stated in the original offer or by making any modification in the original offer then such
acceptance will not considers as the valid acceptance and it will be defines as the counter offer or
the new offer.

Contract Law 3
Counter offer also considers as the mirror rule, and as per this rule acceptance must reflect the
original offer and its terms and not the new terms. Therefore, if acceptance fails to reflect the
terms of the original offer then such acceptance is not valid in context of the original offer.
Application:
On 1st March, Letter is written by the Ann in which she makes offer to the Jack to sell the car for
$12000, and she also write that offer is open till the date of 7th March and not beyond that.
However, after sending that letter to the Jack she dropped the idea to sell the car, and she also
write letter on 2nd March to the Jack for cancelling the offer made by her in her first Letter.
First letter send by the Ann in which she makes the offer to sell the car is receives by the Jack on
3rd March. Jack send letter to Ann on the same day at 2:00 A.M in context of offer made by the
Ann, and in this letter jack stated that he accepts the offer but he would like to make the payment
in instalments that is $1000 of month for an year. Ann received this letter on 4th March.
On 3rd March, Jack received the cheque of $ 16000 from his uncle in the evening, and based on
this cheque, he send second letter to Ann in context of accepting the offer on the same terms as
stated by Ann. After sending this letter to the Ann, Jack receives the second letter send by Ann
on 2nd March in which he cancels the offer he made to sell the car.
In this case, there is no valid contract between the parties because offer made by the Jack is the
counter offer. Jack makes the counter offer in letter send on 3rd March, and that letter is receives
by the Ann on 4th March, which means counter offer is also communicates to the Ann.
This case involves the implementation of the provisions related to the termination of offer. As
per these provisions, the offeree rejects once the offer then offeree cannot accept the offer again.
As stated above, offeree can reject the offer by making the new offer or counter offer. Counter
offer is defines as the new offer, which means, accepting the original offer made by the offeror
on terms which are not similar to the original offer. There is no such rule which states that
difference between the terms of original offer and acceptance must be major, which means even
in case of minor difference, acceptance with modified terms is considers as the counter offer.
Counter offer was the way through which offer was rejected by the offeree. In this case, plaintiff
made the counter offer and this automatically rejects the original offer made by defendant. Court
further stated that once the offeree rejected the offer, then it was not possible for offeree to
accept it.
In case law Holland v. Eyre (2 Sim. & St. 194), and on the basis of the principles of this case
Court stated that plaintiff made the counter offer instead of accepting the original proposal. This
counter offer ends the original proposal and left the defendant never accepted proposal made by
the plaintiff in the question, and the offer made by the plaintiff. One more scenario was also