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CONSTITUTING A BINDING CONTRACT: OFFER, ACCEPTANCE, CONSENSUS AD IDEM

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Dictum

In law, to constitute a binding contract between parties, there must be a meeting of the mind often referred to as consensus ad idem. The mutual consent relates to offer and acceptance. While an offer is the expression by a party of readiness to contract on the terms specified by him by which if accepted by the offeree gives rise to a binding contract, the offer only matures into a contract where the offeree signifies a clear and unequivocal intention to accept the offer. An offer can be accepted in such a manner as may be implied, such as doing an act which the person expecting acceptance wants done. On the other hand, an invitation to treat is simply the first step in negotiations between the parties to a contract. It may or may not lead to a definite offer being made by one of the parties to the other in the negotiation. In law therefore, an invitation to treat is thus not an agreement or contract. See Meka BAB Manufacturing Co. Ltd v. ACB Ltd (2004) 2 NWLR (PT. 858) 521. See also Unitab Nigeria Ltd v. Engr. Oyelola and Anor (2005) All FWLR (Pt. 286) 824 @ pp. 829-830; Okugbule and Anor v. Oyegbola and Ors (1990) 4 NWLR (pt. 147) 723; See also Afolabi v. Polymera Industries Ltd (1967) 1 All NLR 144; Nneji v. Zakhem Construction Nig. Ltd (2006) 12 NWLR (Pt. 994) 297; BFI Group Corporation v. Bureau of Public Enterprises (2012) LPELR-9339 (SC).

— B.A. Georgewill JCA. Stanbic IBTC Bank Plc V. Longterm Global Capital Limited & Ors. (CA/L/427/2016, 9 Mar 2018)

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SETTING ASIDE A VOIDABLE CONTRACT IS NOT AUTOMATIC

As I observed a moment ago, the setting aside of a voidable transaction cannot be automatic. If it were, there will then be no difference between a void transaction (whose setting aside is automatic) and a merely voidable transaction (whose setting aside depends on all the equities and surrounding circumstances).

– Oputa, JSC. Adejumo v. Ayantegbe (1989)

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WHEN AGREEMENT IS MADE

An agreement is made where there exists an offer, acceptance, consideration, capacity to contract and intention to create legal relationship. – Niki Tobi JSC. Yaro v. Arewa CL (2007)

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COURTS DO NOT MAKE CONTRACT FOR THE PARTIES

It is not the function of the court to make contracts between the parties. The courts duty is to construe the surrounding circumstances including written or oral statements so as attest the intention of the parties. Where the correspondence exchanged between the parties are read together, it can be assumed that the parties have come to an agreement.

– Adekeye JSC. Nwaolisah v. Nwabufoh (2011)

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PARTIES BOUND BY CONTRACTUAL TERMS IN ABSENCE OF FRAUD

The well laid down position of the law is that Courts do not rewrite contact for the parties where the terms of the contract are clear. In the absence of fraud, duress and undue influence, misrepresentation, the parties are bound by their contract. It is only parties to a contract that can sue and be sued on it.

– Rhodes-Vivour JSC. Alade v. Alic (2010)

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WHAT IS BREACH OF CONTRACT?

Breach of contract arises in a situation wherein a party to an agreement, fails to perform his own obligations, thereby causing damages to the other party or parties to the agreement, who have taken certain steps on the basis of the agreement. In order to prove breach of contract, the party asserting must clearly show what actions or omissions the defaulting party is guilty of that constitutes the breach.

– Tukur JCA. Odulate v. FBN (2019)

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