terms. If we can define some of the terms a little clearer, it might prevent mistakes; but I think we are quite agreed on all. We shall therefore expect you on Monday. (Signed)-J. Appleby.-P.S.-I have made a list of customers which we can consider together." It was held that on the whole and especially having regard to the postscript, which left an important term open to discussion, there was no complete contract. . . "Where a contract is to be made out," said Grove, J., "by an offer on one side and an acceptance on the other, if the answer is equivocal or anything is left to be done, the two do not constitute a binding contract... The second letter refers to terms which required to be further considered to make a final agreement. If the acceptance is not clear and certain, but leaves something to be arranged, something for future discussion and decision, the parties are not ad idem (a).” In Crossley v. Maycock (b) an offer to buy certain land was accepted, but with reference to special conditions of sale not before known to the intending purchaser. Held only a conditional accept ance. In Stanley v. Dowdeswell (c) an answer in this form: "I have decided on taking No. 22, Belgrave Road, and have spoken to my agent Mr. C., who will arrange matters with you," was held insufficient to make a contract, as not being complete and unqualified, assuming (which was doubtful) that the letter of which it was part did otherwise sufficiently refer to the terms of the proposal. In Addinell's case (d) and Jackson v. Turquand (e), a bank issued a circular offering new shares to existing shareholders in proportion to their interests, and also asking them to say if in the event of any shares remaining they should wish to have any more. Certain shareholders wrote in answer, accepting their proportion of shares, and also desiring to have a certain number of additional shares, if they could, on the terms stated in the circular. In reply to this the directors sent them notices that the additional shares had been allotted to them, and the amount must be paid to the bank by a day named, or the shares would be forfeited. It was held by Kindersley, V. C., and confirmed by the House of Lords, that as to the first or proportional set of shares the shareholder's letter was an acceptance constituting a contract, but as to the extra shares it was only a proposal; and that as the directors' answer introduced a material new term (as to forfeiture of the shares if not paid for within a certain time), there was no binding contract as to these. (a) L. R. 9 C. P. 163-4. (b) 18 Eq. 180. (c) L. R. 10 C. P. 102. (d) 1 Eq. 225. (e) L. R. 4 H. L. 305. In Wynne's case (a) two companies agreed to amalgamate. The agreement was engrossed in two parts, and contained a covenant by the purchasing company to pay the debts of the other. But the purchasing company (which was unlimited) before executing its own part inserted a proviso limiting the liability of its members under this covenant to the amount unpaid on their shares. This being a material new term, the variance between the two parts as executed made the agreement void. In this, and later in Beck's case (b), in the same winding up, a shareholder in the absorbed company applied for shares in the purchasing company credited with a certain sum according to the agreement, and received in answer a letter allotting him shares to be credited with "a proportionate amount of the net assets" of his former company. It was held that, apart from the question whether the allotment was conditional on the amalgamation being valid, there was no contract to take the shares. cient ac ceptance. On the other hand the following instances will show that the rule of suffimust be cautiously applied: an acceptance may be complete though it expresses dissatisfaction at some of the terms, if the dissatisfaction stops short of dissent, so that the whole thing may be described as a "grumbling assent" (c). Again, an acceptance is of course not made conditional by adding words that in truth make no difference; as where the addition is simply immaterial (d), or a more formal memorandum is enclosed for signature, but not shown to contain any new term (e). And further, if the person answering an unambiguous proposal accepts it with the addition of ambiguous words, which are capable of being construed consistently with the rest of the document and so as to leave the acceptance absolute, they will if possible be so construed (f). And perhaps it is in like manner open to the accepting party to disregard an insensible or repugnant qualification annexed to the proposal: as where a man offers to take shares in a company, "if limited," which in contemplation of law he must know to be not limited, and the directors allot shares and notify the allotment to him without taking any notice of the attempted qualification. But in the case referred to this view is not necessary to the result; for the applicant wrote a second letter recognizing the allotment. The letter of allotment might therefore be treated as a counter-proposal,-viz., to allot shares in a company not limited-of which this last was the (a) 8 Ch. 1002. (b) 9 Ch. 392. (c) Joyce v. Swann, 17 C. B. N. S. 84: Cp. per Lord St. Leonards, 6 H. L. C. 277-8 (in a dissenting judgment.) (d) Clive v. Beaumont, 1 De G. & S. 397. (e) Gibbins v. N. E. Metrop. Asylum District, 11 Beav. 1. (f) English & Foreign Credit Co. v. Arduin, L. R. 5 H. L. 64; per Lord Westbury at p. 79. Parties pone con clusion of contract, though on agreed on till embo acceptance (a). And in fact there is one case somewhat against the view here suggested: the letter of allotment was headed "not transferable," apparently through a mere mistake of law, so that on a fair construction it would seem to have been, not a really conditional acceptance, but an acceptance with an imaginary and illusory condition, wrongly supposed to be implied in the nature of the transaction: but it was held that no contract was constituted (b). Again, the unconditional acceptance of a proposal is not deprived of its effect by the existence of a misunderstanding between the parties / in the construction of collateral terms which are not part of the agreement itself (c). In connexion with this topic generally Lord Westbury's judgment in Chinnock v. Marchioness of Ely (d) may be consulted with profit, though it does not actually decide any notable point. One further caution is needed. All rules about the formation may post- and interpretation of contracts are subject to the implied proviso, "unless a contrary intention of the parties appears." And it may happen that though the parties are in fact agreed upon the terms-in other words, though there has been a proposal suffithe terms, ciently accepted to satisfy the general rule-yet they do not mean the agreement to be binding in law till it is put into writing or into a formal writing. If such be the understanding between them, of course they are not to be sooner bound against both their wills. Whether such is in truth the understanding is a question of fact which depends on the circumstances of each particular case (e). died in more for mal instrument Agreement must be certain. It is not to be supposed, "because persons wish to have a formal agreement drawn up, that therefore they cannot be bound by a previous agreement, if it is clear that such an agreement' has been made; but the circumstance that the parties do intend a subsequent agreement to be made is strong evidence to show that they did not intend the previous negotiations to amount to an agreement" (1). 6. An agreement is not a contract unless its terms are certain or capable of being made certain. (a) Perrett's ca., 15 Eq. 250. (d) 4 D. J. S. 639. (e) See next note. (J) Ridgway v. Wharton, 6 H. L. C. 238, 264, 268, per Lord Cranworth, C., and see per Lord Wensleydale at pp. 305-6. ! For the Court cannot enforce an agreement without knowing what the agreement is. Such knowledge can be derived only from the manner in which the parties have expressed their intention. If that expression has no definite meaning, there is nothing to go upon. The parties may have come to a real agreement, but they must take the consequences of not having made it intelligible. Thus a promise by the buyer of a horse that if the horse is lucky to him, he will give £5 more, or the buying of another horse, is "much too loose and vague to be considered in a court of law." "The buying of another horse" is a term to which the court cannot assign any definite meaning (a). Questions of this kind, however, as well as those we spoke of in the last paragraph, arise chiefly where the alleged contract is evidenced by writing; and further the importance of the rule depends chiefly if not wholly on the more general rule of evidence which forbids the contents or construction of an instrument in writing to be varied or supplemented by word of mouth. Certain aspects of this rule will come before us in a later chapter. On the rules of construction in general we do not enter; but we may mention shortly as a thing to be borne in mind, that words are to be taken in the sense in which they were understood by the parties using them; and that, in the absence of anything to show that a different meaning was contemplated, is the sense in which a reasonable man acquainted with the subject-matter would understand them. The question then is, can such a sense be arrived at with reasonable certainty? One instance, perhaps a rather strong one, will serve as well as many. An agreement to take a house "if put into thorough repair," and if the drawing-rooms were "handsomely decorated according to the present style" has been dismissed as too vague to be enforced (b). One might at first sight think it not beyond the power of a reasonable man or twelve reasonable men fairly acquainted with dwelling-houses to say whether the repairs and decorations executed in a particular house do or do not answer the above description. It must be observed, however, that this was a suit for specific performance; and a court of equity may and sometimes does decline to grant that remedy on the ground that the existence of a concluded contract is very doubtful, but (a) Guthing v. Lynn, 2 B. & Ad. 232. (b) Taylor v. Portington, 7 D. M. G. 328. Illusory promises. without undertaking to decide that no contract exists. Formerly, indeed, it was the rule with courts of equity to leave questions of legal right open as much as possible, but the modern tendency is the other way. To this head those cases are perhaps best referred in which the promise is illusory, being dependent on a condition which in fact reserves an unlimited option to the promisor. "Nulla promissio potest consistere, quae ex voluntate promittentis statum capit" (a). Thus where a committee had resolved that for certain services "such remuneration be made as shall be deemed right," this gave no right of action to the person who had performed the services; for the committee alone were to judge whether any or what recompense was right (b). Moreover a promise of this kind, though it creates no enforceable contract, is so far effectual as to exclude the promisee from falling back on any contract to pay a reasonable remuneration which would be inferred from the transaction if there were no express agreement at all. In Roberts v. Smith (c) there was an agreement between A. and B. that B. should perform certain services, and that in one event (let us say no. 1) A. should pay B. a certain salary, but that in another event (no. 2) A. should pay B. whatever A. might think reasonable. Event no. 2 having happened, the Court held there was no contract which B. could enforce. Services had indeed been rendered, and of the sort for which people usually are paid and expect to be paid; so that in the absence of express agreement there would have been a good cause of action for reasonable reward. But here B. had expressly assented to take whatever A. should think reasonable (which might be nothing), and had thus precluded himself from claiming to have whatever a jury should think reasonable. It is submitted, however, that it would not be safe to infer from this case that under no circumstances whatever can a promise to give what the promisor shall think reasonable amount to a promise to give a reasonable reward, or at all events something which a jury can find not to be illusory. The circumstances of each case (or in (a) D. 45. 1. de verb. obl. 108, § 1. (c) 4 H. & N. 315, 28 L. J. Ex. 164. |