There are several issues that affect the concept of offer and acceptance in contract law. These issues usually affect the interpretation of the concept to suit different situations. They are as follows;
Artificiality
Clearly, there are situations in which the concepts of offer and acceptance have to be stretched and interpreted rather artificially, even though it is clear that the parties have agreed. This was the position of Lord Denning in Gibson v Manchester City Council (1979) in which he stated that he was in favor of looking at negotiations as a whole in order to determine whether there was a contract rather than trying to impose an offer and acceptance on the facts.
Revocation of unilateral offers
The problem of whether a unilateral offer can be accepted by part-performance has caused difficulties for the courts. It can be argued that since the offeree has not promised to complete the performance, they are free to stop at any time, so the offeror should be equally free to revoke the offer at any time.
This is generally considered unjust, and various academics have expressed the view that in fact an offer cannot be withdrawn once there has been substantial performance. American academics have contended that the offeror can be seen as making two offers: the main offer that the price will be paid when the act is performed, and an implied offer accompanying the offer that the main offer will not be revoked once the performance has begun. On this assumption, the act of starting performance is both acceptance of the implied offer, and consideration for the secondary promise that the offer will not be revoked the offer after the performance has started may be sued for the breach of the secondary promise.
Revocation of offers for specific periods
The rule that an offer can be revoked at any time before acceptance even if the offeror has said it will remain open for a specified time could be considered unfairly biased in favor of the offeror and makes it difficult for the offeree to plan their affairs with certainty.
An ‘all or nothing approach
The ‘all or nothing’ approach of offer and acceptance is not helpful in cases where there is clearly not a binding contract under that approach, and yet going back on agreements made would cause great hardship or inconvenience to one party. In a commercial situation, the pressure of time may mean that a company starts work on a potential project before a contract is drawn up and signed. They will be at a disadvantage if, in the end, the other party decides not to contract. The courts have for commercially matters found a way around the problem, by allowing what is called a quasi-contractual claim, but given the need for certainty in business transactions, it seems less than ideal.
Objectivity
The courts claim that they are concerned with following the intention of the parties in deciding whether there is a contract, yet they make it quite clear that they are not actually seeking to discover what was intended, but what, looking at the parties’ behavior, an ‘officious bystander’ might assume they intended. This can mean that even though the parties were actually in agreement, no contract results, as was the case in Felthouse v Bindley.
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