Acceptance

Acceptance

Definition (AO1)

Acceptance is the expression by the offeree (by words or conduct) of assent to all the terms of the offer.

Must be a ‘mirror’ acceptance of all the terms - Cannot vary

Acceptance

Case

(Society of Lloyds v Twinn)

“The acceptance must correspond with the offer and must be clear and unqualified and would fail to take effect, if it attempts to vary the terms of the offer or to add new terms”

3 Methods of Acceptance:

Definition (AO1)

1. Words

2. Conduct

3. Performance

Methods of Acceptance - Conduct

Side note

Where the person does the conduct required to accept an offer without actually being aware of its existence (or has forgotten about the reward), this is not valid acceptance.

(Gibbons v Proctor) - Not aware

(R v Clarke) - Forgotten reward

Methods of Acceptance - Conduct

Case

(Brogden v Metropolitan Railway)

B suplied M with coal regularly without a contract. R sent a written contract to B. B altered, signed and returned the contract. Railway placed in a draw and continued to order coal. Seen as Acceptance when continuing to buy coal

Methods of Acceptance - Performance

Case

(Carlill v Carbolic Smoke Ball Co) - Performance
C performed terms of the offer

Acceptance by Silence

Rule (AO1)

There can be no acceptance from silence!

Acceptance by Silence

Case (AO3)

(Felthouse v Bindley)

Uncle wanted to buy Nephew’s horse and said “if I don’t hear from you, I’ll consider him mine.” Nephew was happy with this and told auctioneer to not sell the horse as had been sold to Uncle. Nephew's inaction did not amount to acceptance, confirming that silence cannot constitute valid acceptance.

Electronic Communication of Acceptance
Rule (AO1)

Acceptance must be communicated to and received by the offeror

TIMING IS KEY!!!

Consider almost instantaneous means of communication:

• Telephone - When offeror hears the acceptance

• Email - When acceptance is received not necessarily read (Thomas and Gander v BPE solicitors)

• Text - When offeror receives acceptance message

• Internet - Once customer is notified that goods have been shipped

Electronic Communication of Acceptance - Email
Rule (AO1)

Postal rule does not apply:

• The burden is on the offeree to make sure the acceptance gets through

• If acceptance message is interrupted and offeree knows this then he should repeat it and make sure it is received.

• If offeror knows the message is being sent but does not receive it, he should ask offeree to repeat it

• If message does not go through and no one is at fault then acceptance has not been communicated

Electronic Communication of Acceptance - Email
Case

(Thomas v BPE Solicitors) - 6pm was held to be in office hours

If an email is sent in office hours, acceptance takes place when the email is received, as sender can reasonably expect the recipient to be checking their messages i.e. 9am-5pm (office hours vary)

(Mondial Shipping v Astarte Shipping) - Outside office hours

Messages sent outside office hours will be deemed to have been received at the start of the next working day

Electronic Communication of Acceptance - Email (Consumer Contract)
Rule (AO1)

Under The Consumer Contracts (Information, cancellation and Additional Payments) Regulations 2013:

“Obligation is imposed on seller to provide certain information to consumers before acceptance is complete”

Info includes:

1. Description of Goods/Services

2. Details of price and any additional charges

3. Information about the seller

“An exchange of emails prior to a contemplated written contract does not amount to a completed contract

Buyer has an automatic right to cancel within 14 days

Electronic Communication of Acceptance - Email (Consumer Contract)
Case

(Pretty Pictures v Quixote Films)

Purchases Via a Website
Rule (AO1)

Business to Business = Electronic Commerce Regulations 2002

R12: “Display of items on the internet is an invitation to treat; customer’s order may be the offer”

Consumer Contracts = Distance Selling Regulations 2000

The Seller must:

1. Give the buyer clear information

2. Give Written information

3. Allow a cooling off period of 7 days to allow the buyer to change their mind.

International Communication of Acceptance
Case

(Entores v Miles Far East Corp)

C sent telex from England to Amsterdam. Q was where acceptance took place and held that the acceptance took place and was valid when received in England.

Acceptance by Post (Postal Rule)

Rule (AO1)

An exception to the general rule that it must be communicated and received. Contract is formed when acceptance letter is posted.

Exception:

1. Offeror can exclude postal rule by requiring notice of acceptance

2. Rule only applies where it is reasonable to use post in the first place

Acceptance by Post

Cases

(Adams v Lindsell) - Key case

Acceptance is effective once the letter of acceptance is posted, even if it is delayed or lost in transit.

(Holwell Securities Ltd v Hughes) - Excluded postal rule

Offeror required ‘notice in writing’ - Postal rule will not apply where it would lead to ‘manifest inconvenience or absurdity’

(Henthorn v Fraser) - Reasonable to use post

What is meant by ‘Posted’

Definition (AO1)

Posted means correctly stamped and addressed and put in a postbox or given to a mail worker authorised to accept letters for delivery.

The postal rule will not apply if a mistake in posting acceptance is the offeree’s fault i.e. not correctly stamped etc

What is meant by ‘Posted’

Case

(Re London v Northern Bank) - Definition of ‘posted’

(Getreide Import v Contimar) - Mistake in posting acceptance

Postal rule being unjust

Case

(Household Fire v Grant) - Unjust outcome

Methods of Communicating Acceptance

Rule (AO1)

When Offeror prescribes mode of acceptance:

• Offeree may accept by any method provided no less advantageous to the offeror.

Therefore - For the offeror to make method of communication mandatory, the offeror must expressly state that it is binding in the offer.

Where no method is prescribed - Offeree must use any reasonable method depending on:

• The nature of offer

  &

• Method of communicating offer

Methods of Communicating Acceptance

Case

(Manchester Diocesan Council v Commercial Investments Ltd)

O requested Acceptence to be sent to his address but the offeree responded in a different manner, which was still valid as it did not disadvantage the offeror.

Acceptance of a Unilateral Offer

Principle (AO1)

Where offeror makes offer requiring performance by offeree:

• Offeree is not bound to perform

• Offeror bound by offer when performance is complete

• Offeror cannot revoke offer after offeree has started to perform.

• There is no need to communicate acceptance to offeror

Acceptance of a Unilateral Offer

Case

(Errington v Errington) - Implied obligation

father promised to let son and daughter have his house if they paid the mortgage. Father died but agreement still legally binding since the young couple started paying the mortgage.

Tenders

Rule (AO1)

A party submitting a tender makes an offer. There is no obligation to accept any of them

Standing offer tenders are accepted anew with each order, forming a new contract. Revocation must occur before the order is made.

Tenders

Cases

(Spencer v Harding) - Tender Rule

(Great Northern Railway Co v Witham) - Standing order Tender