Contracts > Contracts Keyed to Murphy > The Bargain Relationship
Dickenson v. Dodds
Citation. 2 Ch.D. 463 (Court of Appeal, Chancery Division, 1876).
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Brief Fact Summary.
On Wednesday, June 10, 1874, Defendant made a written offer to sell property to the Plaintiff. The offer was worded that it would remain open until 9:00 a.m. Friday, June 12, 1874. After this offer was made, on Thursday, June 11, 1874, Plaintiff learned that Defendant had changed his mind and determined to sell the property to another person. Plaintiff then manifested his acceptance, in the proper manner, before 9:00 a.m. on June 12, 1874.
Synopsis of Rule of Law.
This case deals with the difference between Agreements to Sell and Offers to Sell. When an Agreement to Sell is made and intended to be left open until a certain time, it is generally irrevocable until that time lapses. An Offer to Sell, on the other hand, is merely that and is revocable at the offeror’s whim.
Plaintiff brought suit, contending that he had manifested his acceptance and made such acceptance known to Defendant in a timely manner, per the terms of the offer. The Defendant countered, contending that because Plaintiff had knowledge of the fact that he intended to sell to another person, he had constructively notified Plaintiff of the withdrawal of his offer and that he was not bound by its terms. At the initial hearing of this matter, Judgment was rendered for the Plaintiff, for specific performance. Defendant appealed.
The controlling question is whether Plaintiff’s manifestation of acceptance of Defendant’s offer was timely, in lieu of the fact that Defendant had manifested the intention to sell to another person and Plaintiff had notice of this intent.
James, L.J., on behalf of the Court, focuses on the concept of the meeting of the minds. When an offer is made and acceptance is transmitted, it is generally accepted that both parties are in agreement. In this case, the Plaintiff knew that the Defendant had changed his mind and yet he still tried to accept his offer. There was no longer a meeting of the minds, in that Defendant’s intention to sell to the Plaintiff had changed.
Concurrence. In his concurrence, Mellish, L.J. focuses on the difference between an Agreement to Sell and an Offer to Sell. Because Defendant termed his writing as merely an offer, he was free to change his mind, and not bound by any time period outlined in the offer. If there had been agreement between the parties that the offer would remain open, Defendant would have been bound.
This case illustrates the principal outlined in the Restatement (2d) Section:43: “An offeree’s power of acceptance is terminated when the offeror takes definite action inconsistent with the intention to enter into the proposed contract and the offeree acquires reliable information to that effect.” In other words, because Defendant’s actions were inconsistent with his offer and because Plaintiff was aware that Defendant had changed his mind, his power of acceptance was terminated.