Facts
On 6 June 1840, Wrench offered to sell his farm to Hyde for £1,000. Hyde's agent replied with an offer of £950. Wrench considered this and, on 27 June, refused it.
On 29 June, Hyde wrote that he would now accept the original offer of £1,000. Wrench didn't proceed with the sale, and Hyde sought specific performance of what he said was a binding contract.
Issue
Was there a contract? Specifically, could Hyde accept Wrench's original £1,000 offer after making his own counter-offer of £950?
Decision
Lord Langdale MR held that there was no contract. Hyde's bill for specific performance was dismissed.
Reasoning
By offering £950, Hyde made a counter-offer. A counter-offer does two things: it puts new terms on the table, and it rejects the original offer. Once rejected, the original offer no longer exists and can't be accepted.
Hyde's letter of 29 June couldn't revive the £1,000 offer by accepting it. At most, it was a fresh offer by Hyde to buy at £1,000, which Wrench was free to accept or refuse. He refused.
Why it matters
Hyde v Wrench is the foundation of the rule that an acceptance must be a mirror image of the offer. If the reply changes the terms, it's not an acceptance. It's a counter-offer, and the original offer dies.
The rule has important limits and applications:
- Requests for information. In Stevenson, Jacques & Co v McLean (1880) 5 QBD 346, a buyer asked whether the seller would accept delivery over two months. That was an inquiry, not a counter-offer, so the original offer stayed open.
- The battle of the forms. In Butler Machine Tool Co Ltd v Ex-Cell-O Corporation (England) Ltd [1979] 1 WLR 401, the buyer's order on its own terms was a counter-offer. When the seller signed and returned the buyer's acknowledgement slip, it accepted the buyer's terms. This "last shot" approach was confirmed in Tekdata Intercommunications Ltd v Amphenol Ltd [2009] EWCA Civ 1209.
- Other ways an offer ends. Rejection and counter-offer sit alongside revocation (which must be communicated: Byrne & Co v Van Tienhoven & Co (1880) 5 CPD 344), lapse of time, failure of a condition and death.
How it comes up in exams
Offer and acceptance problems usually include a chain of letters, emails or phone calls. Work through each communication in order and classify it:
- Is it an offer, an invitation to treat, a counter-offer, a request for information or an acceptance?
- If it's a counter-offer, the earlier offer is dead. Any later "acceptance" of the old offer is only a new offer.
- Check timing rules, such as the postal rule for acceptances (Adams v Lindsell (1818) 1 B & Ald 681) and the receipt rule for revocations.
On SQE1, expect scenarios where a buyer replies "yes, but at a lower price" or "yes, if delivery is next week". The correct answer will usually turn on whether that reply was a counter-offer.
Frequently asked questions
What was decided in Hyde v Wrench?
The court held that when Hyde offered £950 in response to Wrench's offer to sell his farm for £1,000, that counter-offer rejected the original offer. Hyde's later attempt to accept the £1,000 offer therefore created no contract.
What is the difference between a counter-offer and a request for information?
A counter-offer proposes different terms and rejects the original offer. A request for information, such as asking whether credit terms are available, leaves the original offer open (Stevenson, Jacques & Co v McLean (1880) 5 QBD 346).
How does Hyde v Wrench apply to the battle of the forms?
When businesses exchange standard terms, each new set of terms usually operates as a counter-offer. The contract is often made on the last set sent before performance begins (Butler Machine Tool Co v Ex-Cell-O Corp [1979] 1 WLR 401).
Can a rejected offer ever be revived?
Only if the offeror makes it again. The offeree can't revive it by purporting to accept, but the offeror is free to accept that "acceptance" as a new offer.