Offer and Acceptance in Irish Contract Law

This page covers formation once you have identified the offer — acceptance, its communication, prescribed methods, and how offers terminate. For the separate question of whether a statement was a true offer at all, see our note on offer vs invitation to treat.

The objective test

Irish contract law does not ask what a party privately intended; it asks how a reasonable person in the other party's position would have understood their words and conduct. The classic statement is Smith v Hughes (1871) LR 6 QB 597 Persuasive (Eng): a party who so conducts himself that a reasonable person would believe he was assenting is bound as if he had intended to agree. What matters is intention as communicated to and understood by the other party (The Hannah Blumenthal [1983] 1 All ER 34 Persuasive (Eng)). Every rule below is ultimately an application of this test.

What can be accepted: a real offer

An offer is a clear, unambiguous statement of the terms on which the offeror is willing to be bound the moment it is accepted — nothing further is needed from them for a contract to arise. A statement that leaves the maker free to walk away is not an offer. In Hoare v Allied Irish Banks plc [2014] IEHC 221 Binding (IE) a bank's statement that it would show some forbearance was held to be an intimation that it would do its best — not a definite offer capable of acceptance.

Unilateral offers are accepted by performing an act rather than by promising. The foundational case is Carlill v Carbolic Smoke Ball Co [1893] 1 QB 256 Persuasive (Eng). Irish courts apply the same idea: an employer's unconditional notice offering half-pay to employees who enlisted was a unilateral offer accepted by joining up (Billings v Arnott & Co (1946) 80 ILTR 50 Binding (IE)), and a signed voluntary-severance offer became binding on the employee's acceptance (Browne v Iarnród Éireann [2014] 2 IR 506 Binding (IE)).

Acceptance must be final, unqualified — and communicated

Acceptance is a final and unequivocal expression of agreement to all the terms of the offer. Two ingredients: the fact of acceptance and its communication. Both were missing in Parkgrange Investments v Shandon Park Mills (HC, 2 May 1991) Binding (IE), where a vendor signed a contract only for tax purposes, kept it with his solicitor and never sent it — no intention to accept and nothing communicated.

Acceptance can be inferred from conduct. In Brogden v Metropolitan Railway (1877) 2 App Cas 666 Persuasive (Eng) the parties acted for years on an unexecuted draft; ordering and supplying under it accepted its terms.

Acceptance must mirror the offer. Introduce a new term and you make a counter-offer, not an acceptance: in Swann v Miller [1919] 1 IR 151 Binding (IE) a purported acceptance that added a £50 annual ground rent was a counter-offer. A counter-offer also destroys the original offer, which cannot afterwards be accepted (Hyde v Wrench (1840) 3 Beav 334 Persuasive (Eng)). A mere request for information, by contrast, leaves the offer standing (Stevenson, Jacques & Co v McLean (1880) 5 QBD 346 Persuasive (Eng)).

Silence is (usually) not acceptance

An offeror cannot impose a contract by treating silence as assent. In Felthouse v Bindley (1862) 11 CB (NS) 869 Persuasive (Eng) (the buyer wrote that if he heard no more he would treat the horse as his) there was no acceptance. Irish law is the same: in Russell & Baird v Hoban [1922] 2 IR 159 Binding (IE) a note deeming silence to be acceptance after three days was ineffective: Ronan J held that one party cannot impose such conditions on another. Narrow exceptions exist — for example where both parties agree silence will bind, or where an established course of dealing dispenses with express acceptance. What can look like a further exception — taking the benefit of work that a reasonable person knows is not gratuitous — is better analysed as acceptance by conduct: the offeree's actions, judged objectively, manifest assent. It is the conduct, not the silence, that accepts.

Prescribed methods, and where acceptance takes effect

Where the offeror prescribes a method of acceptance, that method may need to be completed before a contract arises, and the offer can be revoked before it is (Walker v Glass (1979) NI 129 Persuasive (NI)). As a general rule acceptance is effective on receipt; the well-known postal rule is a narrow exception (acceptance complete on posting where post was contemplated). Because the timing rules for post differ from those for revocation, they are a favourite exam trap — see our dedicated note on the postal rule.

How an offer ends

An offer must still be alive when accepted. It can end by:

• Revocation. An offer may be withdrawn any time before acceptance — even where the offeror promised to keep it open — unless the offeree gave consideration for that promise (an option). Withdrawal is effective only when communicated (Byrne v Van Tienhoven (1880) 5 CPD 344 Persuasive (Eng)), and notice can come from any reliable source, not just the offeror (Dickinson v Dodds (1876) 2 Ch D 463 Persuasive (Eng)).
• Rejection or counter-offer (Hyde v Wrench).
• Lapse of time — on expiry of any stated period, or after a reasonable time judged by the subject-matter (Ramsgate Victoria Hotel v Montefiore (1866) LR 1 Exch 109 Persuasive (Eng)).
• Death — which ends an offer of personal services, though other offers may survive (Re Whelan [1897] 1 IR 575 Binding (IE)).

Knowledge and motive

You cannot accept an offer you do not know exists (R v Clarke (1927) 40 CLR 277 Persuasive (Aus)). But once you know of it, your motive for accepting is irrelevant (Williams v Carwardine (1835) 5 C & P 566 Persuasive (Eng)).

Related Contract notes: offer vs invitation to treat · the postal rule · intention to create legal relations · consideration · all free Contract notes.