when two parties make identical offers to each other, in ignorance of each other’s offer, the offers are cross offers. Such offers do not constitute acceptance of one’s offer by the other and as such there is no completed agreement. For eg. A wrote to B offering to sell him certain goods. On the same day, B wrote to A offering to buy the same goods. The letters crossed in the post. There is no
concluded contract between A and B.
Let me give you an example so that you can understand it better. Suppose on 15 October, 1989 A wrote to B offering to sell him 100 tons of iron at Rs. 8,800 per ton. On the same day, B wrote to A offering to buy 100 tons of iron at Rs. 8,800 per ton. The letters crossed in the post. There is no concluded contract between A and B, because the offers were simultaneous Each being made in ignorance of the other, and there is no acceptance of each other’s offer.
You all must be thinking about the contracts which are entered into a by large number of people at the same time. These are called standard form contracts we have already discussed them
in brief but now I would like to take up a few examples of such contracts.
Communication of special terms (Standard Form Contracts) Regarding the communication of the special terms of the contract as contained in a ticket, receipt, or, ‘standard form documents’, the more important rules adopted by the courts are as follows.
(i) If the acceptor or the promisee had no knowledge of special terms. Before or at the time of the contract, they are not binding upon the acceptor.
In Handerson vs. Stevenson. “ the plaintiff bought a steamer ticket which bore on its face the words. ‘Dublin to white haven’ on the back of the ticket certain special terms were printed one of which excluded the liability of the company for loss, injury or delay to the passenger or his luggage. The plaintiff never looked at the back of the ticket as it bore no reference to the back. The plaintiffs luggage was lost in the shipwreck caused by the fault of the company’s servants. He claimed damages for its loss. It was held that the plaintiff was entitled to recover his loss from the company as there was not sufficient communication of the terms and conditions contained on the back of the ticket.
(ii) If the acceptor or the promisee had the knowledge or may be presumed to have the knowledge; because a reasonably sufficient notice has been given to him by suitable words on the document; of special terms, before or at the time of the contract, the terms are binding upon the acceptor whether he has read them or not is immaterial. The leading case on the point is Parker vs. South Eastern Railway co.
In the above case P deposited his bag at the cloak room at a railway station and received a ticket containing on its face the words, ‘see back’. On the back of the ticket there was a condition that, “ the company will not be responsible for any exceeding the value of £10 unless extra charge was paid”. A notice to the same effect was hung up in the cloak room P’ s bag was lost and he claimed the actual value of the lost bag. £ 24 sh 10 P, admitted knowledge of the printed matter on the
ticket, but denied having read it. It was held that, even though he had not read the exemption clause, he was bound by it. As the defendants had done what was reasonably sufficient to give
him notice of its existence, and therefore P was entitled the recover only £ 10.
Again, where the terms are printed in a language which the acceptor does not understand, he cannot set up this fact as a reason for not being bound by the terms, provided his attention is drawn to them by suitable words on the document. It is the acceptor’s duty to ask for a translation of the terms before he actually accepts the offer and if he did not ask, he must suffer for his ignorance (MacKillican vs. the Compagnie Markemas de France). Similarly, the acceptor cannot plead that he was illiterate or blind, provided the notice is reasonably sufficient for the class of persons to which he belongs (Thompson vs. L.M. & S. Railway co).
It is important to note that the special terms and conditions become binding as part of the contract only if they are brought to the notice of the acceptor before or at the time of contract. A
subsequent communication will not bind the contracting party unless he has assented thereto. The facts of Olley vs. Marlborough court LTD. Case provide a good illustration on the point.
In the above case Olley and her husband hired a room at a hotel and paid for a week’s board and lodging in advance. When they went to occupy the room there was a notice on one of the walls which contained the clause. ‘ the proprietors will not hold themselves responsible for articles lost or stolen, unless handed to the manageress for safe custody. Owing to the negligence of the hotel staff, a thief entered the room and stole some of their property. The owner of the hotel was held liable since the notice formed no part of the contract as it came to the knowledge of the plaintiff after the contract had been entered into.
Again, where the terms are printed in a language which the acceptor does not understand, he cannot set up this fact as defence. He must suffer for his ignorance (Mackillican vs. the companies Marukemas de France) . Similarly, the acceptor cannot plead that he was illiterate of blind the contracting party unless he has assented thereto. The facts of Olley vs. Marlborough
court Ltd. Case provide a good illustration on the point.
Finally, we must note that even where adequate notice of the terms and conditions in a document has been given, the doctrine of fundamental breach and strict construction protects
the contracting party form the unreasonable consequences of wide and sweeping exemption clauses. Thus a dry-cleaner’s terms that he will pay only eight times the amount of cleaning
charges, for any damage to or loss of garments has been held to be unreasonable (M. Siddalingappa vs. T. Nataraj).