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ACCEPTANCE, Types of communication - Coggle Diagram
ACCEPTANCE
DEFINITION
S26(b) CA1950
"When a person to whom the proposal is made signifies his assent thereto, the proposal is said to be accepted : a proposal when accepted, becomes a promise."
Can be made by :
- Conduct
(Carlill's case where the response to the challenge to use smokeball constituted acceptance)
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S5(2) CA1950
Revocation of acceptance :
May be revoked at anytime before the communciation of acceptance is complete.
(1) CONDITIONS
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Must be expressed in some usual and reasonable manner, unless the offeror prescribes the manner in which it is to be accepted.
If the offer stipulates the mode of acceptance, then acceptance must take place according to the method specified.
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(2) DURATION
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Sometimes an offeror does not specify how long the offer will be kept open. If so, court have to decide a reasonable length of time it should be kept open (Ramsgate Victoria Hotel v Montefiore (1866))
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Types of communication
Emails
The court held acceptance takes place the moment the email is received by the offeror.
Mere silence is NOT acceptance (Felthouse v Bindley)
THREE exceptions that acceptance must be communicated :-
- Offeree benefitted when he could have rejected the offer; silence may be acceptance.
- Where performance is acceptance (Carlill's case).
- Where the mode of communication specified is the post.
However, if the offeree benefits when he has the time to reject the offer, silence may acceptance.
Example :
Weatherby v Banham
A proposer sent food to the promisee, prescribing the promisee accepts the proposal by consuming the said food. In this situation the act of consuming the food amounted to an acceptance even if the promisee kept silent (not communicating to proposer).
Postal rule
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If both parties agreed to use post as a mode of communcation, then acceptance takes place the moment the letter is posted provided the letter is to be properly stamped and correctly addressed.
Sent - 29/1 < this is Acceptance
Letter received - 30/1
Example :
Adams v Lindsell
D made an offer to sell goods requiring an answer 'in the course of post'. P wrote back accepting the offer. The letter of acceptance was lost and delayed. In the meantime, D sold the goods to someone else.
Held - The acceptance was made when P posted the letter in the post box and NOT when it reached the offeror. There was a valid contract.
Postal Rule of Revocation
- It can be revocation of offer/acceptance.
- Revocation takes effect the moment the letter is received and NOT when it is posted.