Question

Susan, a Jumping Pound, Alberta farmer, had four productive milk cows that she wished to sell for $800.00 each. George a neighboring farmer had been looking at the cows but he wanted to consider others before he made a decision. Susan offered to sell George the cows for $600.00 each, if he would take all four cows. George still wanted to think about this so Susan told him she would leave the offer open for four days and that he could e-mail his acceptance if he wished.

Two days later, Susan received an offer from Tony to buy all four cows for $700.00 each on the condition that they were delivered to his farm in Jumping Pound. She phoned George later that day and advised him that she had accepted Tony's offer. George is angry since Susan had said he had four days to think about it. Susan accepted Tony's offer believing the delivery cost to be about $100 per cow to Jumping Pound, Alberta when in reality the shipping costs were to Jumping Pound, Manitoba at $800 per cow. Susan did not know that Tony's farm was located in a town with the same name in Manitoba, that is Jumping Pound, Manitoba not Jumping Pound, Alberta.

a. Does George have any legal remedy against Susan? Fully explain your answer stating the legal rules that would apply.  

b. What would be the circumstance if George had e-mailed his acceptance before he received the call from Susan?  Fully explain your answer stating the legal rules that would apply.

c. Is Susan bound by the terms of the agreement she made with Tony? Explain.

Answer 1

Answer 2

a. George may have a legal remedy against Susan based on the principle of offer and acceptance. In this case, Susan made an offer to sell the cows to George for $600.00 each if he took all four cows. This offer created an option contract where George had a specified time (four days) to accept the offer. However, before the expiration of the four-day period, Susan accepted Tony's offer to buy the cows at a higher price.

The key issue here is whether Susan's offer to George was still open and capable of acceptance when she accepted Tony's offer. Generally, an offer can be revoked at any time before acceptance, unless there is an option contract or other consideration given to keep the offer open for a specified period.

In this case, Susan stated that she would leave the offer open for four days, creating an option contract. Therefore, George may argue that he had the right to accept the offer within the specified period, and Susan's acceptance of Tony's offer before the expiration of the four days was a breach of the option contract. George could seek remedies such as specific performance (forcing Susan to sell the cows at the agreed price) or damages for breach of contract.

b. If George had e-mailed his acceptance before he received the call from Susan, there would be a stronger argument for George to have a legal remedy. By sending his acceptance before Susan accepted Tony's offer, George would have effectively communicated his acceptance and formed a valid contract with Susan. The moment George's acceptance was sent, it would be considered effective, and Susan accepting Tony's offer afterward would not impact the contract between George and Susan.

c. Susan may be bound by the terms of the agreement she made with Tony. When Susan accepted Tony's offer, a contract may have been formed between them. However, the crucial aspect here is the mistake regarding the location of Tony's farm. If Susan can prove that she entered into the agreement with Tony based on a mutual mistake regarding the location (Jumping Pound, Manitoba instead of Jumping Pound, Alberta) and that the mistake was material to the contract, she may have grounds to argue for the contract's rescission or modification. The mistake would need to be significant enough to affect the parties' intentions and the nature of the agreement. Susan should seek legal advice to determine the specific legal rules and remedies available in her jurisdiction.