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Invitation to treat.

An invitation to treat is a mere declaration of willingness to enter into negotiations; it is not an offer, and cannot be accepted so as to form a binding contract. In practice, the formation of a contract is frequently preceded by preliminary negotiations. Some of the exchanges in these negotiations contain no declaration at all, as where one party simply asks for information.

Others may amount to invitations to the recipient to make an offer, these being invitations to treat. Thus, a distinction must be drawn between those declarations which amount to offers, and those which only amount to invitations to treat. Sometimes, a particular type of declaration is, at least prima facie, put into one or the other category by statute or by common law; but in all other cases it is a question of intention.

An express statement that a declaration is not an offer is effective to prevent it being an offer, but the mere use of the terminology 'invitation to treat' or 'offer' in the declaration may not be conclusive one way or the other. Otherwise, the vital question is the intention of the declarant, though his actual intention may give way to a contradictory apparent intention. Whether the actual intention of the declarant does give way to his apparent intention cannot usually depend on his subsequent conduct, but may be affected by the state of mind of the declarant.

1 As to the meaning of 'offer' see para 632 ante.2 Gibson v Manchester City Council [1979] 1 All ER 972, [1979] 1 WLR 294, HL. As to the meaning of 'acceptance' see para 650 post.3 See eg Harvey v Facey [1893] AC 552, PC ('Will you sell us…telegraph lowest cash price…'; and see paras 637, 650, 667 post).4 See eg Spencer v Harding (1870) LR 5 CP 561 (advertisement requesting tenders; and see para 635 post); Kahn v Evans [1985] RTR 33, DC (taxi plying for hire); Interfoto Picture Library Ltd v Stiletto Visual Programmes Ltd [1989] QB 433, [1988] 1 All ER 348, CA (telephone request for supply of goods; subsequent supply an offer by conduct: see para 632 ante).

5 Eg sales by auction: see the Sale of Goods Act 1979 s 57(2), codifying Payne v Cave (1789) 3 Term Rep 148; and see para 636 post.6 See eg Pharmaceutical Society of Great Britain v Boots Cash Chemists (Southern) Ltd [1953] 1 QB 401, [1953] 1 All ER 482, CA (priced goods on shelf in self-service store; and see para 634 post); Harvela Investments Ltd v Royal Trust Co of Canada (CI) Ltd [1986] AC 207, [1985] 2 All ER 966, HL (common intention to perform an existing invalid contract not an offer; and as to referential bids see para 635 post).7 See eg Financings Ltd v Stimson [1962] 3 All ER 386, [1962] 1 WLR 1184, CA ('this agreement shall become binding on the owner only upon acceptance by signature'; held: no offer by owner). But see Appleby v Errington [1952] CLY 1352 (in negotiating for a settlement of an action counsel said he was not binding himself; claim withdrawn; held: compromise binding). As to intention to create legal relations see para 718 post.

8 See eg Spencer v Harding (1870) LR 5 CP 561 ('We are instructed to offer…for sale by tender…': see also para 635 post); Clifton v Palumbo [1944] 2 All ER 497, CA ('I…am prepared to offer you…my…estate for £600,000…': see also para 637 post). Similarly, Bigg v Boyd Gibbins Ltd [1971] 2 All ER 183, [1971] 1 WLR 913, CA (communication termed an 'acceptance'; held: an offer); Harvela Investments Ltd v Royal Trust Co of Canada (CI) Ltd [1986] AC 207, [1985] 2 All ER 966, HL (communication requesting another to make an 'offer' itself; held to be an offer).

9 Harvela Investments Ltd v Royal Trust Co of Canada (CI) Ltd [1986] AC 207, [1985] 2 All ER 966, HL (invitation to fixed bidding). For instance, in the following cases it was held that no offer was intended: Moorhouse v Colvin (1851) 15 Beav 341 (father stated that he would give daughter property on her marriage); Re Fickus, Farina v Fickus [1900] 1 Ch 331 (similar case); Licenses Insurance Corpn and Guarantee Fund Ltd v Lawson (1896) 12 TLR 501 (statement at board meeting that he would make good any loss arising on investment); Montreal Gas Co v Vasey [1900] AC 595, PC ('we would favourably consider an application from you…for a renewal of the [contract]'); Loftus v Roberts (1902) 18 TLR 532, CA ('I agree to engage you…at a West End salary'); British Homophone Ltd v Kunz and Crystallate Gramophone Record Manufacturing Co Ltd (1935) 152 LT 589 (an option granted 'on terms to be hereinafter agreed'); Clifton v Palumbo [1944] 2 All ER 497, CA (see note 8 supra); Rapalli v KL Take Ltd [1958] 2 Lloyd's Rep 469, CA (see para 634 note 9 post). See also Peter Lind & Co Ltd v Mersey Docks and Harbour Board [1972] 2 Lloyd's Rep 234 (letter merely part of negotiations as to price).

10 For instance, the cases where a person at an auction bids under a mistake: Robinson, Fisher and Harding v Behar [1927] 1 KB 513, DC (bid for wrong lot); Tamplin v James (1880) 15 ChD 215, CA (mistaken impression that lot included two extra plots at back of inn). As to auctions see para 636 post; and as to mistake see para 703 et seq post. See also Moran v University College Salford (No 2) [1994] ELR 187, CA (a clerical error which offered a University place).11 Rapalli v KL Take Ltd [1958] 2 Lloyd's Rep 469 at 484, CA, per Romer LJ (the subsequent conduct of a party cannot convert an invitation to treat into an offer, but might itself amount to a new (possibly implied) offer). As to offers possibly having retrospective effect see para 631 ante.

Meaning of 'offer'.

An offer is an expression by one person or group of persons, or by agents on his behalf, made to4 another, of his willingness6 to be bound to a contract with that other on terms either certain or capable of being rendered certain.

An offer may be made to an individual or to a group of persons or to the world at large. It may be made expressly by words, or it may be implied from the conduct of the offeror, as where the seller of goods tenders the wrong quantity.An offer must be distinguished from a mere invitation to treat.

1 An offer may be express or implied: see para 618 ante.2 As to joint promises see para 1079 et seq post.3 Generally, whatever a person has a power to do himself he may do by means of an agent: see AGENCY vol 2(1) (Reissue) para 57.4 As to communication of offer see para 642 post.5 As to the requirement of two or more certain and separate parties see para 604 ante. See also Damon Cia Naviera SA v Hapag-Lloyd International SA, The Blankenstein, The Bartenstein, The Birkenstein [1985] 1 All ER 475, [1985] 1 WLR 435, CA (identity of buyer undisclosed; as to undisclosed principals generally see AGENCY vol 2(1) (Reissue) para 167).6 As to intention to create legal relations see para 718 et seq post.7 An offer 'subject to contract' is not an offer: Bennett, Walden & Co v Wood [1950] 2 All ER 134, CA. As to agreements 'subject to contract' see para 671 post.8 As to the meaning of 'a contract' see para 601 et seq ante.9 For a discussion of the requirement of certainty of terms see para 672 post.10 See eg British Bank Foreign Trade Ltd v Novinex Ltd [1949] 1 KB 623, [1949] 1 All ER 155, CA (written offer of commission in return for introduction).11 See eg The Satanita [1897] AC 59, HL (contracts between entrants for a race).12 As to offers to the world at large see para 639 post.13 See eg Errington v Errington and Woods [1952] 1 KB 290, [1952] 1 All ER 149, CA ('the house will be your property when the mortgage is paid').14 See eg Interfoto Picture Library Ltd v Stiletto Visual Programmes Ltd [1989] QB 433, [1988] 1 All ER 348, CA (dispatch of goods an offer by conduct); as where a contract is discharged by an agreement to abandon it inferred from conduct see para 1014 post.15 See eg Hart v Mills (1846) 15 LJ Ex 200 (seller tendered more goods than those ordered); and see the Sale of Goods Act 1979 s 30(2), (3); and para 618 ante. But the discrepancy may be so great as to constitute a new offer, in which case statute may allow it to be treated as an unsolicited gift: see the Unsolicited Goods and Services Act 1971 s 1; and SALE OF GOODS AND SUPPLY OF SERVICES vol 41 (2005 Reissue) para 657 et seq.