Posted: January 1st, 2016

Using the four-step process, discuss whether the element of agreement required for the formation of a contract can be established. Did Michael have a legally enforceable contract with Clare? Does Clare have to sell the special offer set to Michael?

Clare owns and operates an antique store in Fremantle that is open between 9am and 5pm Monday to Saturday. One Wednesday morning, Michael is looking for a present for his girlfriend Jessica and comes across the antique store. Michael noticed in the shop window an antique Mirror on sale for $300, he believes that Jessica will like the antique mirror, but he cannot afford $300. Michael enters the store and discusses the matter with Clare the shop owner, who offers to sell him the items for $250. Michael replies by saying ‘that he has to think about it’. Clare says ‘that she will keep the offer open for acceptance until 10am the next day’. Clare gives Michael her business card (which has the relevant phone numbers) and Michael gives Clare his mobile phone number.

That evening Michael decided that he would buy the antique mirror for his girlfriend Jessica. He telephoned the number on the business card and leaves a message at 10pm to the effect that he agrees to buy the antique mirror for $250 and that he would call by the bookshop on Thursday afternoon to collect and pay for the antique mirror.

The next day, Thursday, Clare opens the antique store for business at 9am. Around 9.30am Christina visited the shop and saw the antique mirror in the shop window. She enters the shop and is very keen to purchase the antique mirror to add it to her antique collection, and offers Clare $270 for the items. Clare accepted Christina’s offer. Christina paid for the antique mirror and left Clare’s antique shop with her purchase.

At 10am Clare telephoned Michael and told him that she was withdrawing her offer and that she had sold the antique mirror to Christina. Michael then told Clare that he had left a message on the answering service last night at 10pm saying that he agrees to purchase the antique mirror for $250. After her telephone conversation with Michael, Clare accessed the answering machine message and heard the telephone message that Michael had left the previous evening.