cient In Honeyman v. Marryat (i), before the House of Lords, a proposal for Instances a sale was accepted "subject to the terms of a contract being arranged" of insuffibetween the vendor's and purchaser's solicitors: this was clearly no acceptcontract. Compare with this Hussey v. Horne Payne (k), from which it ance. seems that an acceptance of an offer to sell land "subject to the title being approved by our solicitors" is not a qualified or conditional acceptance, but means only that the title must be investigated in the usual way; in other words, it expresses the conditions annexed by law to contracts of this class, that a good title shall be shown by the vendor. In Appleby v. Johnson (1), the plaintiff wrote to the defendant, a calicoprinter, and offered his services as salesman on certain terms, among which was this: "a list of the merchants to be regularly called on by me to be made." The defendant wrote in answer: "Yours of yesterday embodies the substance of our conversation and 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. In Crossley v. Maycock (m) 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 acceptance. In Stanley v. Dowdeswell (n) 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 (o) and Jackson v. Turquand (p), 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 (i) 6 H. L. C. 112, by Lord Wensleydale. The case was not argued, no one appearing for the appellant. (k) 4 App. Ca. 311, 322. () L. R. 9 C. P. 158. (m) 18 Eq. 180. (n) L. R. 10 C. P. 102. Compare Smith v. Webster, 3 Ch. D. 49. (0) 1 Eq. 255. (P) L. R. 4 H. L. 305. Instances of sufficient acceptance extra shares it was only a proposal; and that as the directors' answers 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. In Wynne's case (2) 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 (r), 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. On the other hand, the following instances will show that the rule must 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" (8). 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 (t), or a mere formal memorandum is enclosed for signature, but not shown to contain any new term (u). 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 (x). 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-proposalnamely, to allot shares in a company not limited-of which this last was the acceptance (y). And in fact there is one case somewhat against the (9) 8 Ch. 1002. (8) Joyce v. Swann, 17 C. B. N. S. 84; cp. per Lord St. Leonards, 6 H. L. C. 277-8 (in a dissenting judgment). (t) Olive v. Beaumont, 1 De G. & S. 397. (u) Gibbons v. N. E. Metrop. Asy. lum District, 11 Beav. 1. (x) English & Foreign Credit Co. v. Arduin, L. R. 5 H. L. 64; per Lord Westbury, at p. 79. (y) Perrett's ca., 15 Eq. 250. 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 (z). 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 (a). pone con contract, the terms, bodied in strument. One further caution is needed. All rules about the Parties formation and interpretation of contracts are subject to may postthe implied proviso, "unless a contrary intention of the clusion of parties appears." And it may happen that though the though parties are in fact agreed upon the terms-in other words, agreed on though there has been a proposal sufficiently accepted to till emsatisfy the general rule-yet they do not mean the agree-bodie ment to be binding in law till it is put into writing or into formal ina formal writing. If such be the understanding between them, they are not to be sooner bound against both their wills. "If to a proposal or offer an assent be given subject to a provision as to a contract, then the stipulation as to the contract is a term of the assent, and there is no agreement independent of that stipulation" (b). Whether such is in truth the understanding is a question which depends on the circumstances of each particular case; if the evidence of an agreement consists of written documents, it is a question of construction (not subject to any fixed rule or presumption) whether the expressed agreement is final (c). 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 (2) Duke v. Andrews, 2 Ex. 290. (a) Baines v. Woodfall, 6 C. B. N. S. 657, 28 L. J. C. P. 338. The facts unfortunately do not admit of abridgment. (b) Chinnock v. Marchioness of Ely, 4 D. J. S. 638, 646. (c) Rossiter v. Miller, 3 App. Ca. 1124, 1152. Agree. ment must 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" (d). Still more is this the case if the first record of the terms agreed upon is in so many words expressed to be "subject to the preparation and approval of a formal contract" (e). But again: "it is settled law that a contract may be made by letters, and that the mere reference in them to a future formal contract will not prevent their constituting a binding bargain" (ƒ). And in Brogden v. Metropolitan Ry. Co. (g), it was held by the House of Lords that the conduct of the parties, who in fact dealt for some time on the terms of a draft agreement which had never been formally executed, was inexplicable on any other supposition than that of an actual though informal consent to a contract upon those terms. The tendency of recent authorities is to discourage all attempts to lay down any fixed rule or canon as governing these cases. The question may however be made clearer by putting it in this way-whether there is in the particular case a final consent of the parties such that no new term or variation can be introduced in the formal document to be prepared (h). Certainty of Terms. An agreement is not a contract unless its terms are be certain. certain or capable of being made certain. 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 (d) Ridgway v. Wharton, 6 H. L. (e) Winn v. Bull, 7 Ch. D. 29. (g) 2 App. Ca. 666: see Lord Cairns' opinion. (h) Lord Blackburn, 3 App. Ca. at p. 1151. In addition to cases already cited see Lewis v. Brass, (C. A.) 3 Q. B. D. 667. 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 57. 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 (i). 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 conversant with affairs of the kind in which the contract is made would understand them. The question then is, can such a sense be arrived at with reasonable certainty? One or two instances will serve as well as many. An agreement to sell an estate, reserving "the necessary land for making a railway," is too vague (). An agreement to take a house "if put into thorough repair," and if the drawing-rooms "handsomely decorated according to the present style," has also been dismissed as too uncertain to be enforced (1). One might at first sight think it not beyond the power of a reasonable man or twelve reasonable men were (4) Guthing v. Lynn, 2 B. & Ad. 232. (k) Pearce v. Watts, 20 Eq. 492. (1) Taylor v. Portington, 7 D. M. & G. 328. |