Reference no: EM131172003

On 21 February Andrew, who works as a salesman at Wholesome Vegetables Ltd, wrote to Ben, owner of a retail shop, offering to sell him 100 bags of potatoes at $10 per bag.

On 23 February, Ben posted a reply accepting Andrew's offer but adding that if he did not hear from Andrew, he would assume that the price included delivery to his (Ben's) shop.

On 24 February, before Ben's letter arrived, Andrew heard a rumour that the price of potatoes was about to slump dramatically. Andrew immediately sent a fax to Ben, stating that "prices include delivery".

Ben received Andrew's fax at 10 am on 24 February, where upon he immediately posted a letter confirming his acceptance of Andrew's terms.

Over lunch, however, Ben also heard the news about a slump in the price of potatoes, where upon he sent Andrew a text message stating: 'decline your offer of pots'.

The price of potatoes has now fallen to $7 per bag and Ben refuses to accept delivery of Andrew's pricey potatoes.

Questions:

Explain briefly all the requirements that must be met for a contract to exist between Andrew and Ben.

Explain, with reference to legal principles and case law, the legal effect of Andrew's letter of 21 February and Ben's reply on 23 February.

Analyze and explain, with reference to legal principles, the legal effect of Andrew fax and Ben's letter of 24 February

Explain, with reference to Ben's text message stating 'decline your offer of pots'.