Brief of Dahlia Ltd v Four Millbank Nominees

Brief of Dahlia Ltd v Four Millbank Nominees by Legum

Dahlia v Four Millbank Nominees [1978] Ch 231 Court of Appeal

Material Facts:

The appellant-plaintiffs (herein appellants), Dahlia Ltd, sought to buy property from the defendants. Although there was no written agreement between the appellants and the defendants for the purchase, the appellants claimed they obtained a unilateral offer from the defendants that if they obtained a banker’s draft for the purchase, a written contract would be completed. The appellants obtained the banker’s draft, but the defendant refused to complete the contract.

Issue:

1. Whether or not Four Millbank Nominees could withdraw their unilateral offer after Dahlia Ltd had started performance.

Holding:

1. It was held that once performance starts, revocation cannot be valid.

Ratio Decidendi:

Goff LJ stated that although an offeror has the right to require full performance to be bound, the offeror has an obligation not to prevent the offeree from satisfying the conditions of the contract dictated by the offeror. This obligation, according to Goff LJ, arose as soon as the offeree starts to perform. Prior to the start of performance, however, the offeror is free to revoke.

Comments:

What are your comments on the case and the ruling?

Dahlia v Four Millbank Nominees [1978] Ch 231 Court of Appeal

Material Facts:

The appellant-plaintiffs (herein appellants), Dahlia Ltd, sought to buy property from the defendants. Although there was no written agreement between the appellants and the defendants for the purchase, the appellants claimed they obtained a unilateral offer from the defendants that if they obtained a bankers draft for the purchase, a written contract would be completed. The appellants obtained the bankers draft, the defendant refused to complete the contract.

Issue:

1. Whether or not Four Millbank Nominees could withdraw their unilateral offer after Dahlia Ltd had started performance.

Holding:

1. It was held that once performance starts, revocation cannot be valid.

Ratio Decidendi:

Goff LJ stated that although an offeror has the right to require full performance in order to be bound, the offeror has an obligation not to prevent the offeree from satisfying the conditions of the contract dictated by the offeror. This obligation, according to Goff LJ, arose as soon as the offeree starts to perform. Prior to the start of performance, however, the offeror is free to revoke.

Comments:

What are your comments on the case and the ruling?

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