Communication of Acceptance Flashcards
Communication of Acceptance
Straightforwardly identified where the parties are dealing face to face
Not straightforward when not in the same place
Contract is normally formed when offeror receives acceptance from offeree
Problems with communication of acceptance when both parties are not togethet
Adams v Lindsell (1818) 1 B & Ald 681
1) Lindsell wrote to Adam offering to sell wool, requested a response in the course of post (2nd Sep) (next available opportunity)
2) Lindsell accidentally sent to wrong address – so Adams didn’t receive letter till 5th Sep
3) Adams posted response (acceptance) that day, but it did not arrive with Lindsell until 9th Sep
4) Lindsell had in the meantime (on 8th Sep) sold wool to another buyer
Contract is formed when offeror recieves acceptance HOWEVER exceptions include:
A good sense rule with exceptions:
1) The rule will not apply when the reason for lack of communication is due to negligence on the part of the offeror –> Rule of receipt
2) The rule might not apply when the postal rule is used
3)The offeror may waive the requirement to communicate (especially in unilateral contexts)
Rule of Reciept
Entores v Miles Far East Corporation [1955] 2 QB 327
> Acceptance sent by telex from Amsterdam to a machine in London – where was the contract formed? Contract was made in london because acceptance was recieved in London
Objective Assessment
Communication is received when it would reasonably be expected to have been received
E.g. if offeree sends email accepting offer at 1am in the night, that doesn’t necessarily mean acceptance has been received straight away, —> bur rather acceptance will be recieved when the offeror sees the email the next morning at 9am
Exceptions - Negligence of offeror - 1
E.G. offeree sends an an email accepting an offer, but it ends up in the offerors junk email
–> a reasonable person would OBJECTIVELY say that acceptance has been communicated EVEN THOUGH SUBJECTIVELY the offeror hasn’t seen the acceptance email because its in the junk email –> BUT CONTRACT IS STILL FORMED because how is the offeree supposed to know that their acceptance has ended up in junk emails
Exceptions - Postal Rule - 2
Acceptance is communicated when letter has been POSTED
EVEN applies even where the letter is lost (Household Fire and Carriage Accident Insurance Co Ltd v Grant (1879) 4 Ex D 216) –> doesnt make sense cause contract would still be formed even if letter got lost and the offeror wouldnt realise they have an agreement and entered a contract
THEREFORE the postal rule has been gradually eroded
Erosion of postal rule
The postal rule will only apply id both parties expect communication to happen through letter (Henthorn v Fraser [1892] 2 Ch 27)
The offeror may expressly or impliedly exclude its application (Holwell Securities Ltd v Hughes [1974] 1 WLR 155) –> offer was made and the offeror says he needed to receive acceptance by a certain time therefore the postal rule didn’t apply
EXCEPTIONS - Implied waiver of unilateral offer - 3
Waiver –> doesnt have to be done e.g. offeree doesnt have to communicated acceptance
What if the offeror revokes the offer before receiving acceptance?
Revocation must be communicated to the offeree (Byrne v Van Tienhoven (1880) 5 CPD 344)
Communication of revocation follows the rule of receipt
It follows that if acceptance is communicated before revocation is received, there is agreement
Implied obligation on the offeror
E.g. unilateral offer of the firsr person to walk from London to York will recieved 1 million
Offeror could techinically revoke offer even if offerees have done most of walk as they haven’t acctually accepted offer until they finally reach York
However there is implied obligation on offeror because in certain cases like this one the offeror has a duty to keep it open and can’t revoke the offer while the offerees are performing it
