Sham runs a mobile phone retail business. Anticipating a huge demand for the latest 2021 model of the Tianhua mobile phone, he contracted with TPL, the local supplier of Tianhua phones, for the purchase of 100 units of the 2021 Tianhua phone at a total cost of $40,000, to be delivered in 30 days.

Sham started accepting pre-orders for the phone from his customers. He advertised the availability of the 2021 Tianhua phone on his Facebook Business page and invited pre-orders at a unit price of $450, cash payment on delivery. The following exchange of Facebook messages took place between Sham and Goon (Sham's good friend).

Goon: do you have the Tianhua 2021 phone in rose gold colour?

Sham: yes, bro.

Goon: ok, I want 20 phones in rose gold.

Sham: it's a deal!

One week before the delivery date, TPL informed Sham that they were unable to deliver the phones by the deadline as agreed unless a surcharge of $2,400 was paid to cover the cost of expediting delivery. Sham was upset but he agreed to pay the surcharge, as he had already received many pre-orders of the new 2021 phones from customers. However, things took a turn for the worse the next day when Goon informed Sham that he did not want the phones anymore. When Sham protested, Goon insisted that there was no contract between them as he had merely expressed an interest in the phones and anyway, he had not paid.

Meanwhile, TPL managed to deliver the phones to Sham on time. However, when presented with a bill for $42,400 ($40,000 + $2,400), Sham told TPL that he was not going to pay for the surcharge because he felt it was unfair for TPL to charge him extra costs. As for the purchase price, Sham said that he could only pay $30,000 as the demand for the 2021 model had not been as good as he expected, and he was suffering losses after customers had backed out of their pre-orders. TPL was having liquidity problems at the time and reluctantly agreed to take the $30,000 in full settlement of the total outstanding. However, a week later, TPL told Sham that they intended to sue for the outstanding balance.

Required:

Advise Sham whether

a. He has a binding contract with Goon.

b. He is bound to pay the surcharge to TPL.

c. He is bound to pay the balance of the purchase price to TPL.