Ethical Perspective $7\mathrm{.}1$

Dickinson v Dodds $(1876)2$ Ch D $463($CA$)$

George Dickinson was one of several people interested in buying a piece of land from John Dodds. On Wednesday, John wrote to George, offering to sell the property and promising to hold that offer open until Friday morning. While George was considering his options on Thursday, he learned that John was negotiating with another potential buyer. George immediately tried to accept the offer, but he was unable to find John that night. He finally caught up with him the next morning and expressed his desire to buy the property. By that time, however, George had learned from a third party that John had already sold to someone else.

George sued John for failing to fulfil his promise to keep the offer open. The lawsuit failed. The court held that

John's promise was unenforceable because it was entirely gratuitous. ${?}^{19}$ George had not provided anything of value in exchange for John's promise to hold his offer open until Friday.

Questions for Discussion

Do you approve of John's behaviour? What do you think of the fact that the law allowed him to break his promise? Is the law that governs firm offers morally acceptable?

Although firm offers are revocable, most successful business people honour such promises. What reasons might motivate them to do so$?$

OPTIONS Since a firm offer is not enforceable, what can an offeree do to make sure that an offer is held open? The solution consists of an option. An option is a contract in an option is a contract in which a person