Hyde v Wrench [1840]

Court: High Court

Facts: Mr. Wrench (D) initially offered to sell his farm to Mr. Hyde (C) for £1200. Hyde rejected this offer and later counter-offered £1000, stating it was his final offer. Wrench did not accept the counter-offer and instead maintained that his initial offer of £1200 was still valid. Hyde then made a new counter-offer of £950, which Wrench rejected. Hyde subsequently attempted to accept the original offer of £1000, but Wrench had already refused this offer. Hyde sued for breach of contract, arguing that the offer of £1000 was still valid.

Issue: Did Hyde’s counter-offer of £950 invalidate the original offer of £1000, and if so, could Hyde later accept the original offer to form a binding contract?

Held: The court held that there was no contract as Hyde’s counter-offer of £950 had effectively rejected Wrench’s original offer of £1000. Lord Langdale, delivering the judgment, reasoned that a counter-offer acts as a rejection of the original offer. As Hyde's counter-offer rejected the original offer, Hyde could not later revive and accept it. Consequently, there was no binding contract between the parties.

Key Judicial Statement: Lord Langdale MR stated, “The Defendant offered to sell it for £1000, and if that had been at once unconditionally accepted, there would undoubtedly have been a perfect binding contract; instead of that, the Plaintiff made an offer of his own, to purchase the property for £950, and he thereby rejected the offer previously made by the Defendant.”

💡Leveluplaw: Hyde v Wrench establishes that a counter-offer constitutes a rejection of the original offer. This case highlights the importance of understanding that once a counter-offer is made, the original offer is nullified, and the original offer cannot be accepted later. The decision underscores the principle that for a contract to be valid, acceptance must be unconditional and follow the terms of the original offer.