Harvey v. Facey

Three telegrams, sent between Jamaica and what is now Belize, decided a question every first-year contract student eventually asks: if I ask you your price and you tell me, have you actually offered to sell? The Privy Council said no — and gave contract law one of its cleanest illustrations of the gap between information and offer.

Parties

L. M. Harvey and others — plaintiffs/appellants; sent a telegram asking for the lowest price of a property and then purported to "accept" the reply as an offer to sell.

Facey — defendant/respondent; the owner in possession of the property, who answered only the price inquiry and never agreed to sell.

Facts

Facey, the owner of a property known as Bumper Hall Pen, was negotiating with the Mayor and Council of Kingston (Jamaica) for its possible sale to the town. While Facey was travelling by train, Harvey sent him a telegram: "Will you sell us Bumper Hall Pen? Telegraph lowest cash price — answer paid." Facey replied by telegram: "Lowest price for Bumper Hall Pen £900." Harvey then sent a third telegram: "We agree to buy Bumper Hall Pen for the sum of nine hundred pounds asked by you. Please send us your title deed in order that we may get early possession." Facey did not reply to this third telegram and refused to complete a sale. Harvey sued, contending that Facey's telegram quoting £900 was an offer which Harvey's third telegram had validly accepted, so as to form a binding contract of sale.

Issues Raised

1. Did Facey's telegram stating "Lowest price for Bumper Hall Pen £900" amount to an offer to sell the property to Harvey, capable of being accepted?
2. Was Harvey's first telegram — containing two questions, "Will you sell?" and "telegraph lowest cash price" — itself an offer that Facey's reply could be read as accepting?
3. If Facey's reply was not an offer, could Harvey's third telegram ("We agree to buy... for the sum... asked by you") itself constitute a valid, accepted offer forming a contract?

Arguments Contended

On behalf of Harvey (Appellants): It was argued that Facey's telegram, quoting a definite figure of £900 in direct response to a request to "telegraph lowest cash price," was in substance an offer to sell at that price — the only reasonable reading of a specific price quoted in response to a specific request to sell. It was argued that Harvey's third telegram, agreeing to pay exactly the sum named, was a valid and unqualified acceptance of that offer, so that a binding contract of sale had come into existence on ordinary offer-and-acceptance principles, and Facey was bound to convey title.

On behalf of Facey (Respondent): It was argued that Harvey's first telegram asked two separate, independent questions — whether Facey was willing to sell at all, and, separately, what his lowest price would be — and that Facey's reply answered only the second question, supplying a figure, while remaining silent on the first. It was argued that merely stating a price in answer to an inquiry is not, and was never intended as, an expression of willingness to sell; Facey never said "yes" to the question "will you sell," and a court could not read an offer into a telegram that, on its face, communicated only information about price, not an intention to be bound.

Court's Reasoning

The Privy Council held that Harvey's first telegram in fact contained two distinct questions: first, whether Facey would sell, and second, if so, what his lowest price was. Facey's telegram in reply dealt only with the second question and did not answer the first at all — it neither said he would sell nor that he would not; it was confined to stating a price. The Board held that the mere statement of the lowest price at which an owner would sell, if he sold at all, does not by itself imply any willingness on his part to sell to the person who asked for that information — it is, at most, an invitation to treat, or a supply of information, not an offer. Since Facey had never, either expressly or by implication, indicated that he was willing to enter into a contract of sale, there was nothing capable of being turned into a binding agreement merely because Harvey chose to treat the price quotation as though it were an offer. The Board also held that Harvey's own third telegram, purporting to "agree to buy... for the sum... asked," could not itself be accepted as forming a contract, since it was, at best, an offer by Harvey — one that was never accepted by Facey, who neither replied to it nor did anything to signify assent.

Judgement

The Privy Council held that there was no concluded contract between Harvey and Facey. Facey's telegram was merely an answer to a request for information as to price, not an offer to sell; Harvey's third telegram was, at best, an offer that was never accepted by Facey. The appeal was dismissed, and the decision of the courts below (holding there was no contract) was affirmed.

Legal Principle / Ratio

A mere statement of the price at which a person is willing to sell property, made in response to an inquiry, is not by itself an offer to sell to the inquirer — it is only a supply of information (or, in modern terms, an invitation to treat). An offer must show a clear intention to be bound on acceptance of specified terms; supplying a price figure, without more, does not carry that intention. Only when a party expressly or impliedly signifies willingness to sell on stated terms — not merely quotes a figure — is there an offer capable of being converted into a contract by acceptance.

Significance

Harvey v. Facey is the leading authority distinguishing a genuine offer from a mere statement of price or supply of information — the same principle that later underlies the broader "offer vs. invitation to offer" distinction taught for shop displays, price lists, quotations, and tenders. It is regularly cited in Indian contract law (including in cases interpreting Section 2(a) of the Indian Contract Act, 1872) to test whether a communication crosses the line from information into a legally operative offer. Because negotiations often proceed by stages — inquiry, response, further response — this case supplies the essential reminder that each stage must be examined separately for the specific intention it communicates, rather than assuming that any reply naming a figure is automatically an offer open for acceptance.

Exam-Important Points

• Facts in one line: Harvey asked Facey to "telegraph lowest cash price" for a property; Facey quoted £900; Harvey "accepted" that figure, but Facey never actually agreed to sell.
• Holding: Privy Council held no contract — Facey's telegram was only a statement of price, not an offer; Harvey's own "acceptance" telegram was itself an unaccepted offer.
• Key principle: a statement of price in answer to an inquiry is not an offer — it lacks the intention to be bound that a genuine offer must show.
• Classic exam trap: students often assume quoting a specific figure automatically creates an offer — the Privy Council's point is that Facey answered only the "what price" question, never the separate "will you sell" question.
• Frequently paired with the shop-window/invitation-to-offer rule as the two standard illustrations of communications that look like offers but are not.

Facts, bench and citation verified against the Judicial Committee of the Privy Council's own reported judgment (lawcases.net) and independent case-summary sources including e-lawresources.co.uk and Quimbee.