Question 3

David wanted to purchase a car. He searched through the local papers, theTrading PostandThe Herald Sunclassifieds. Eventually, he found a 1988 Volvo station-wagon. After remembering his grandmother's old car, he decided that it would be perfect. David rang the number in the advertisement and spoke to Sarah, the Volvo's owner.

Consider the following separate and unrelated scenarios:

Scenario A

After some negotiations, Sarah offers to sell David the car for $4,500. In response, David says "I need some time to think about it. I'll call you back soon". Five minutes later, David receives a call from his sister, Diana. Their mother has been rushed to hospital in Geelong. David and Diana immediately head to Geelong to look after their mother. Six months later, after returning to Melbourne, David wants to accept Sarah's offer. Is he able to?

Scenario B

After some negotiations, Sarah offers to sell David the car for $4,500 and says she will keep her offer open for the next 30 minutes. Five minutes later, while David was considering the offer, Sarah receives a call from Angelo who offers $5,500 for the car. She immediately accepts. David calls a few minutes later (within the 30-minute limit) and communicates his acceptance of her offer. Does David have a contract with Sarah?

Scenario C

After some negotiations, Sarah offers to sell David the car for $4,500. In response, David says "I need some time to think about it. I'll call you back soon." David calls back and offers Sarah $4,000 for the car. Sarah says it is not enough. David then says "I accept your earlier offer, and will pay you the $4,500." Sarah refuses. Advise David whether he has a contract with Sarah.