1. Must be made willingly: Proposer must be willing to be bound by the terms stated;
2. Terms must be clear and certain. Refer to Section 29 of the Act Case Law: Alfi E. A. Ltd v. Themi Industries and Distributors Agency Ltd. (CAT Dsm Civil Appeal 28 of 1984) and Nitin Coffee Estates Ltd: In both cases the “ Price” was not stateed hence agreement becomes “ Uncertain”; 3. Final Expression: Terms must be firm and final. Changing the terms in statements cannot be regarded as a proposal.
Contracts under various situations
1. Unilateral Contracts: These are one sided contracts. For example
Advertisements. Case Law: Carlill v. Carbolic Smoke Ball Co. (1892) 2Q. B. 484. is an English contract law decision by the Court of Appeal, which held an advertisement containing certain terms to get a reward constituted a binding unilateral offer that could be accepted by anyone who performed its terms. It is notable for its curious subject matter and how the influential judges (particularly Lindley LJ and Bowen LJ) developed the law in inventive ways. Carlill is frequently discussed as an introductory contract case, and may often be the first legal case a law student studies. The case concerned a flu remedy called the “ carbolic smoke ball”. The manufacturer advertised that buyers who found it did not work would be awarded £100, a considerable amount of money at the time. The company was found to have been bound by its advertisement, which it construed as creating a contract.
The Court of Appeal held the essential elements of a contract were all present, including offer and acceptance, consideration and an intention to create legal relations. The Court of Appeal unanimously rejected the company’s arguments and held that there was a fully binding contract for £100 with Mrs Carlill. Among the reasons given by the three judges were (1) that the advert was not a unilateral offer to all the world but an offer restricted to those who acted upon the terms contained in the advertisement (2) that satisfying conditions for using the smoke ball constituted acceptance of the offer (3) that purchasing or merely using the smoke ball constituted good consideration, because it was a distinct detriment incurred at the behest of the company and, furthermore, more people buying smoke balls by relying on the advert was a clear benefit to Carbolic (4) that the company’s claim that £1000 was deposited at the Alliance Bank showed the serious intention to be legally bound.
Example in an Auction Sale & Proposal In tenders.
Proposals and Invitation to Treat
An invitation to treat is merely an announcement to other that a person is prepared to entertain an offer for a certain thing or service.
The invitation to treat may provide minimal terms of a proposed offer.
In Chitty on Contracts (2004), the editors point out that:
“ As a general rule, a display of goods at a fixed price in a shop window or on a shelf in a selfservice store is an invitation to treat and not an offer. An offer may be made by a prospective buyer. At this stage the retailer may accept or reject the offer. “ Similar principles would seem to apply where a supplier of goods or services indicates their availability on a website: that is, the offer would seem to come from the customer (eg. when he clicks the appropriate button) and it is then open to the supplier to accept or reject that offer.” Case Law: Fisher v. Bell (1961) 1Q. B. 394 The Defendant displayed a flick knife in the window of his shop next to a ticket bearing the words “ Ejector knife – 4s.” Under the Restriction of Offensive Weapons Act 1959, section 1(1), it was illegal to manufacture, sell, hire, or offer for sale or hire, or lend to any other person, amongst other things, any knife “ which has a blade which opens automatically by hand pressure applied to a button, spring or other device in or attached to the handle of the knife”. On 14 December 1959, the Claimant, a chief inspector of police force, brought forward information against the Defendant alleging the Defendant has contravened section 1(1) by offering the flick knife for sale. This loophole was closed by Restriction of Offensive Weapons Act 1961  Ban on Flick Knives: which inserted after the words “ offers for sale or hire” the words “ or exposes or has in his possession for the purpose of sale or hire”.”
The judges at first instance found that displaying the knife was merely an invitation to treat, not an offer, and thus no liability arose. The Prosecutor appealed the judges’ decision. Pharmaceutical Society of Great Britain v Boots Cash Chemists (Southern) Ltd  EWCA Civ 6 is a famous English contract law decision on the nature of an offer. The Court held that the display of a product in a store with a price attached is not sufficient to be considered an offer, but rather is an invitation to treat.
Partridge v Crittenden  1 WLR 1204 is an English case, which was heard by the Divisional Court of the Queen’s Bench Division of the High Court of England and Wales on appeal from the Magistrates’ Court and is well-known (amongst other cases) for establishing the legal precedent in English contract law, that usually advertisements are invitations to treat. On the 13th April 1967 an advertisement by the appellant (Arthur Robert Partridge) appeared in the periodical “ Cage and Aviary Birds”, under the general heading “ Classified Advertisements” which contained, amongst others, the words Quality British A. B. C. R… Bramblefinch cocks, Bramblefinch hens 25 s. each. In no place was there any direct use of the words “ offer for sale”. A Thomas Shaw Thompson wrote to Partridge asking him to send him an ABCR Bramblefinch hen (a brambling) and enclosed a cheque for 30s.
On the 1st May 1967 Partridge dispatched a brambling, which was wearing a closed-ring around its leg, to Thompson in a box. Thompson received the box on 2 May 1967 and was able to remove the ring from the bird’s leg without injuring it. Partridge was charged by Anthony Ian Crittenden, on behalf of the RSPCA, with illegally offering for sale a wild life bird which was not a close-ringed specimen, bred in captivity, against s. 6(1)*and Sch. 4* of the Protection of Birds Act 1954. The magistrates decided that the advertisement was an offer for sale and that the ABCR Bramblefinch hen was not a close-ringed specimen bred in captivity, because it was possible to remove the ring from the bird’s leg. Partridge was convicted, was fined £5 and ordered to pay £5 5 s. Advocate’s fee and £4 9 s. 6 d. witnesses’ expenses.
Partridge appealed against conviction.
That is really sufficient to dispose of this case. I should perhaps in passing observe that the editors of the publication Criminal Law Review had an article dealing with Fisher v. Bell in which a way round that decision was at least contemplated, suggesting that while there might be one meaning of the phrase “ offer for sale” in the law of contract, a criminal court might take a stricter view, particularly having in mind the purpose of the Act, in Fisher v. Bell the stocking of flick knives, and in this case the selling of wild birds. But for my part that is met entirely by the quotation which appears in Lord Parker’s judgment in Fisher v. Bell, that “ It appears to me to be a naked usurpation of the legislative function under the thin disguise of interpretation.” I would allow this appeal and quash the conviction.