germany

promise as being revocable. Simone’s promise can be seen as being nongratuitous because when the condition is purified by the discovery and return of the necklace she will clearly receive a benefit, and therefore writing is not required for the constitution of the promise. A potential benefit inherent in the promise is sufficient to render it non-gratuitous. Alternatively, the courts could adopt a contractual analysis such as that used in Carlill v. Carbolic Smoke Ball Co.38 in which an advertisement such as the present one was held to be an offer (offer of £100 to purchaser of defender’s product who suffered flu after using it).

england

The answer in either case is not clear in English law although it is suggested that whilst Raymond could recover against Simone, other persons who had relied on the offer/promise made in the newspaper could not recover.

In English law, an offer of a reward is described as an offer of a unilateral contract. In civil law systems, a ‘unilateral contract’ is one in which only one party assumes an obligation. In English law, the expression ‘unilateral contract’ is used in a much different sense. The defining characteristic of such a contract is that acceptance occurs – or is at least said to occur – by the performance of the requested act. Whether the performing party must know about the offer and be performing in order to satisfy the condition is less clear, but need not concern us here. The question of consideration is not generally raised in such cases, it being assumed that performance is consideration. It should be mentioned, however, that, as various commentators have noted,39 performance in such cases is arguably more properly interpreted as a condition of receiving the benefit, rather than as something done in exchange for the promise.

In practice, the main difficulty raised by unilateral contracts is that raised by this case: what is the effect of a purported withdrawal once a party has commenced performance of the condition? In principle, the offeror should be able to withdraw at any point prior to complete performance, since offers can in general be withdrawn prior to acceptance. Where no reliance has been placed on the offer, this principle is indeed applied, and the offer can be withdrawn. The withdrawal must be communicated, but, while there are no English cases in point, English commentators have assumed that notice of withdrawal need not reach everyone

312 the enforceabilit y of promises

who has heard the offer; it is enough if a reasonable method of communication is used, such as the original medium.40

The result is less clear where a party has incurred expenses in reliance on the offer. According to the orthodox rules, the offer should be capable of being withdrawn at any point prior to acceptance, that is, before completion of the performance. But strict application of this rule would appear capable of leading to injustice and thus it is not surprising that in some cases courts have held that the offer cannot be withdrawn once the plaintiff has commenced performance. In Daulia Ltd v. Four Millbank Nominees Ltd,41 a vendor told buyers that if the buyers showed up the next morning with their part of a contract for sale of land engrossed and signed together with a banker’s draft deposit, the vendors would enter a written contract. It was held that the vendor could not withdraw the next morning after the buyers showed up and, more generally, that there was an implied obligation on the part of the offeror not to prevent the condition becoming satisfied, which obligation arose as soon as the offeree started to perform.42 Precisely what constitutes ‘starting to perform’, and whether and how this is different from ‘preparations to perform’, has not been discussed in English cases, though presumably the courts would try to draw some sort of distinction between the two.

More significantly, the Daulia decision is not followed consistently. In Luxor (Eastbourne) Ltd v. Cooper,43 the appellants promised that if the respondent agent introduced a buyer for their cinemas at the stated price, on completion of the sale the respondent would be paid £5,000. The respondent introduced a buyer, but the appellants refused to proceed with the sale. The court held that the unilateral contract was complete only on actual sale so that the respondent received nothing. The distinction between Luxor and Daulia would appear to be that, in the court’s view, in the former case, but not the latter, it was the normal understanding of parties that the risk of non-completion lay entirely on the agent. This risk was offset by the high rewards earned in cases where completion occurred.

It is difficult to say how a court would apply this distinction to a revocation of reward case (none of the cases in point deal with rewards). Treitel suggests, in the absence of any clear authority, that ‘it is probable that an

40See, e.g., Treitel, Contract, 40, which cites an American case as authority.

41[1978] Ch. 231.

42See also Errington v. Errington [1952] 1 KB 290, where it was held that a father’s promise to turn over a house to his son and daughter-in-law if they paid all the mortgage could

offer of a reward for the return of lost property could still be withdrawn after someone had spent time looking for the property without success, but not after he had actually found it and was in the process of returning it to the owner’.44

It is suggested that this approach is most likely to be followed in Case 14(b), where the advertisement is made ‘to the world’ in a newspaper. No court is going to be very keen on a ruling which in theory could allow thousands of disappointed reward-seekers to claim compensation from Simone. Raymond has a stronger claim because in his case (as in Daulia) the offer was made to him personally, rather than to the world at large. In tort cases dealing with detrimental reliance (e.g., negligent misrepresentation, negligent provision of services), the closer the relationship of the parties the more likely a finding of liability (see Case 5).45 The significance of Raymond being a private detective is unclear. On the one hand, it can be assumed that he would not look for the necklace without some hope of collecting the reward, and that Simone would be aware of this. On the other hand, a court might reason that the possibility of a reward being revoked is, as in Luxor, one of the risks of the business. On balance, I think it unlikely a court would allow revocation once Raymond had begun to search.

Assuming that it is too late for Simone to withdraw her offer to Raymond, what is the effect of attempting to withdraw? In theory an ineffective withdrawal has no effect, and, in the case of a unilateral contract, the other party should be free to try, if he wishes, to complete performance just as if nothing had happened. Performance would of course need to be complete by the relevant expiry date, here the date indicated on the reward or, lacking such a date, a reasonable period. If Raymond failed to find the necklace, he could not collect anything.

The situation is more complex if Raymond ceases looking for the necklace because he wrongly believes that the purported withdrawal is effective or because he believes, perhaps rightly, that Simone is no longer interested in recovering the necklace. It seems likely that an English court would seek to allow Raymond a measure of recovery here, assuming that Raymond was acting reasonably, but the basis on which an award could be made is not clear. There are no cases in point.

One possibility is that Raymond could claim that the withdrawal was in effect an ‘anticipatory breach’ of the contract. An anticipatory breach occurs where one party, before the time at which he is to perform, informs