Spencer v Harding [1870]

Court: Court of Common Pleas

Facts: The defendants issued a circular inviting tenders for the sale of stock from Messrs G Eilbeck & Co, specifying that the stock would be sold at a discount in one lot and that payment was to be made in cash. The claimants submitted the highest tender but were refused the stock by the defendants. The claimants argued that the circular constituted a binding offer and that, by submitting the highest tender, they had accepted this offer.

Issue: Did the circular inviting tenders constitute a binding offer, or was it merely an invitation to treat?

Held: The court ruled in favor of the defendants, holding that the circular was not a binding offer but an invitation to treat. Willes J, delivering the judgment, noted that there was no explicit wording in the circular committing the defendants to sell to the highest bidder. Instead, the circular was an invitation for interested parties to submit tenders, which the defendants were free to accept or reject. There was no obligation on the defendants to sell to any particular tenderer, even if their bid was the highest.

💡Leveluplaw: This case clarifies the legal distinction between an offer and an invitation to treat in the context of tenders. It establishes that an invitation to submit tenders does not bind the issuer to accept any offer, even if it is the highest. This principle protects parties who solicit tenders from being automatically committed to accepting the terms proposed by any bidder, maintaining their discretion in contractual negotiations.