Contracts and cheques

[Dawg]

At which part of the process is a contract formed:

1. Someone makes an offer
2. I accept
3. I give them a cheque for the correct amount (which will be honoured)
4. They cash the cheque.

Is a contract formed at 3, 4, at some other point, or is it dependent on T&Cs?

Context:
I am offered exhibition space, I accept and send off a cheque for the full amount, (following the same procedure used for the last three years).
One week before the exhibition, cheque uncashed, I'm told I cannot exhibit. Exhibition this weekend, cheque as yet unreturned. (In previous years the cheque was only cashed after the exhibition).
Extra circumstance: my product is on the cusp of acceptability to the exhibition, but has been accepted for the previous three years. There were exhibitors whose products had nothing at all to do with the theme of the exhibition.

Am I able to, (and should I), make an exhibition bureaucrat's head go explodey about this?

 

[OldWelshGuy]

My take is that unless they have specific clauses in the T&C, the contract was formed when they agreed terms and accepted your confirmation.

 

[An Oasis]

+1

Can't believe they are fully booked and don't want an exhibitor there (this year most expos have been poor both in exhibitors and attendees) ? Either way they've bitten off more than they want to chew, go get em boy.

 

[MikeJ]

Contract law is based on offer and acceptance. Providing you accepted unconditionally, then you were in contract at 2).

As OWG says, there may be something in the T&Cs that allows them to cancel.

 

[Dawg]

Contract law is based on offer and acceptance. Providing you accepted unconditionally, then you were in contract at 2).

As OWG says, there may be something in the T&Cs that allows them to cancel.

I thought contract law was based on offer, acceptance and consideration, hence the query as to whether consideration happened when the cheque was given to them, or whether it happens when it is presented/cleared etc?

 

[paulears]

I'm pretty sure we're talking about stage 2 and consideration, as in payment is irrelevant. The old adage "My word is my bond" was based on this too. After all, payment after the event is pretty normal for business.

 

[MikeJ]

I thought contract law was based on offer, acceptance and consideration, hence the query as to whether consideration happened when the cheque was given to them, or whether it happens when it is presented/cleared etc?

Don't think so. There needs to be consideration for there to be a contract, but it doesn't need to have been paid at the time.

 

[oldeagleeye]

Most exhibition organizers have a huge number of get out clauses including cancelling the expo giving no notice. As for theme it don't matter. I have seen onion bajas at a graduate exhibition.

If it's another few hundred quid in the orgainzers pocket they will take it.

 

[KM-Tiger]

I thought contract law was based on offer, acceptance and consideration, ....

Interesting stuff. A quick Google of 'contract consideration' points to many articles by m'learned friends, and yes, as stated, the consideration needs to exist for it to be an enforcible contract.

However m'learned friends all seem to also say that this is a very complex area, and to take advice before taking action.

 

[Michael Gerard]

Firstly, for there to be a binding contract, there must have been an offer, an unconditional acceptance of that offer, an intention to create legal relationship and consideration. In absence of these, there is no contract.

So, in relation to the OP's question, a contract comes into being at stage 2, providing the acceptance is unconditional and a sum of money has been agreed (or a formula for working out the price).

The T&C's are very important, as ther posters have pointed out. However, to be effective, the T&C's must not be retrospective, and must have come to the attention of the offeree before acceptance. Therefore, you must read the T&C's carefully, as it is probably dependent on them accepting your offer to exhibit.

 

[oldeagleeye]

As Charlie said the word is 'unconditional'. In the old days that to most of us meant slapping hands on a deal. Today there are 3 little clauses you should always look out for especially if the deal just involves the swapping of order & invoice.

The first is an obvious one that you all know well. Subject to T & C.

The 2nd
which should make you suspicious by it's absence is the statement to the effect that in any dispute and litigation will be under British Law but be careful. We all take Britain to mean England - Scotland - Wales & Northern Ireland. Both Northern Ireland and Scotland in particular have their own laws.

No 3 and this is what catches most people out for a simple deal to go thru ie unconditional the document should ideally say ' this contract does not form part of a larger contract'.

If it doesn't then there may well be a larger contract with all sorts of disclamers and get out clauses to the benefit of the other party.

BOTH buyer and seller beware then. Most of our laws are drawn up by lawyers working for the Gov and by allowing for clauses and the like they guarantee never ending work for the profession.

Rob

 

[maxine]

It's a bit of a grey area but from my studying days there has always been the general rule of offer, acceptance and consideration.

Just to quirk it up a bit, you may also find that the advert for exhibition space was an "Invitation to treat" and not an offer. You then made the offer which was not accepted so no valid contract.

Hope that helps

 

[stugster]

I'm reading an interesting book at the moment, "Scots Law 2" and incidentally just covered this point.

There was a written case with Boots against the Pharmaceutical Council whereby Boots were able to prove the contract was formed at the till when the customer presented the product for tender.

Although this is a completely irrelevant but interesting story, my point is that in terms of Scots Law, stage 2 is where the contract would be formed

A nice story, irrelevant to your case. An answer to your question, but also irrelevant because it's Scots law and not English. Darn, aren't I useful?

 

[Michael Gerard]

I'm reading an interesting book at the moment, "Scots Law 2" and incidentally just covered this point.

There was a written case with Boots against the Pharmaceutical Council whereby Boots were able to prove the contract was formed at the till when the customer presented the product for tender.

Although this is a completely irrelevant but interesting story, my point is that in terms of Scots Law, stage 2 is where the contract would be formed

A nice story, irrelevant to your case. An answer to your question, but also irrelevant because it's Scots law and not English. Darn, aren't I useful?

No different in English and Welsh law - When goods are displayed, this is an 'invitation to treat'. The customer then makes an offer to buy the goods (ie at the till), and a contract comes into place when the retailer accepts the offer (ie accepting payment).

It's all good fun - law that is!

 

[Geoff T]

To me (and assuming points 2 + 3 are contiguous), then I agree that contract formed at point 2, with consideration being met at point 3.

Have they cashed the cheque, or returned it?

If they returned the cheque, then I'd agree with previous that those pesky t's + c's will determine if you have recourse...

Of course, IMO if they HAVE cashed the cheque, then there may be the option to claim for breach of contract - though depends then if it's worth pursuing it...

As they say - the devil is ALWAYS in the detail!

Sorry if this doesn't help much