Session 5.ppt

7/27/2019 Session 5.ppt

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Acceptance S.2(b) defines acceptance as, when the 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.

Thus, the acceptance is the assent given to a proposal, and it has the

effect of converting the proposal into promise.

Communication by external manifestation or overt act.- it is required that

the assent should be signified or expressed, and by any act or omission by

which the party accepting intends to communicate his assent or which has

the effect of communicating.

Fall of the hammer in case of an auction sale is an act amounting to

acceptance.

In certain circumstances, the oferees silence, coupled with such conduct

as takes the form of a positive act, may constitute an acceptance. 2


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CONT

8. Must be given before the offer lapses or before the offer is withdrawn

9. Cannot be implied from silence

Offer & acceptance is complete when communicated.

When we accept & post a letter duly stamped,& it gets lostthe contract is

complete

Rejection of offer-express-notice reaches the offeror -

Implied-counter offer&conditional acceptance


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Acceptance By Conduct

Acceptance by conduct is action in terms of the offer. Cases of unilateral promises /

general offers, demand some act in return for the promise to pay.

S.8. provides that, performance of the conditions of a proposal, of the acceptance of

any consideration for a reciprocal promise which may be offered with a proposal, is an

acceptance of theproposal. Such proposals demand acceptance by performance.

Communication to offeror:

Acceptance must be communicated to the offeror himself. A communication to any

other person is as ineffectual as if no communication has been made.

An offeror cannot impose upon the offree the burden of refusal.

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Communication From Acceptor

The communication of acceptance should be from a person who has the

authority to accept. Information received from an unauthorized person is

ineffective.

Powel v. Lee (1908): the plaintiff was applicant to the headmastership

of a school.

When communication not necessary:

When the offeror prescribes a particular mode of acceptance, then all

that the acceptor has to do is to follow that mode. There may be an offer

which impliedly indicates that acting on its terms will be a sufficient

acceptance. Announcement to pay reward for discovering a lost thing is

an offer of this kind.6


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Mode of Communication

Acceptance should be in prescribed manner: acceptance has to be made in the manner

prescribed or indicated by the offerer, any other manner may not be effective,

particularly where the offerer clearly insists that the acceptance shall be made in the

prescribed manner.

Elliason v. Henshaw (1819): A offered to buy flour from B requesting that an

acceptance should be set by the wagon which brought the offer.

A minor departure from the prescribed mode of communication should not upset the

fact of acceptance provided that the communication is made in an equally expeditious

way.

This AngloAmerican rule has not been strictly followed in the Indian Contract Act.

S.7 deals with this matter.

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Revocation Of Acceptance

According to English law an acceptance once made is irrevocable.

In India, on the other hand, acceptance is generally revocable. An acceptor

may cancel his acceptance by a speedier mode of communication which

will reach earlier that the acceptance itself. Section 5 states the relevancy.

The case if both acceptance and revocation of acceptance reach together,

as per illustration of S.5, the acceptance will be deemed to have been

revoked.

Countess of Dunmore v. Alexander (1830): a proposal of service made by

a letter sent through agent. Offer and revocation received at the same time.

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Contract Over Telephone

It has the same effect as any other ordinary agreement discussed sofar. But the offeree must make sure that his acceptance is properlyreceived, heard and understood by the offeror.

Eg1-A makes an offer to B and at the same time a train/car passesand an important word is not audible there is no contract until hehas reconfirmed what he had said.

Eg2-(Entores Vs Miles )Far East Corporation (1955) say A makesan offer to B over a telephoneand the line goes dead in between sothat A doesn't hear Bs word ofacceptance. There is no contract atthat point. He may not though knowwhen actually the line went

dead but since he doesnt conclude off so he must reconfirm bycalling back. [The principle of the Entores case wasendorsed by theSupreme Court in Bhagwan Dass Kedia Vs Girdharilal,AIR(1966)

Session 5.ppt

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