Question:

Legal Principles:
1. When one person signify to another person his willingness to do or not do something (abstain) with a view to obtain the assent of such person to such an act or abstinence, he is said to make a proposal or an offer.
2. The communication of the offer is complete when it comes to the knowledge of the person to whom it is made.
3. Communication of acceptance is complete when it is put in the course of transmission to him as to be out of the power of the acceptor to withdraw the same and when it comes to the knowledge of the proposer.
4. In case of the proposer, the communication of the acceptance is complete when he puts such acceptance in the course of transmission.
5. The communication in case of the acceptor is complete when the proposer acquires knowledge of such acceptance.
6. An offer may be revoked at any time before the communication of its acceptance is complete as against the proposer, but not afterwards.
Facts: G offered to sell the L fleeces of wool for a certain price. G requested that the response be made by post. This letter was misdirected by G so that it was not received for 3 days after it was sent. L decided to accept the offer and responded on the same day. This was posted on the 5th July but not received until the 9th July. However, G decided on the 8th July that as he had not received a response so decided to sell the wool to someone else. But L argued that a contract had been created as he had accepted their offer. Decide.

  • No contract was formed as L accepted the offer even before he received the offer by post. Contract will be entered upon when L had received the offer and then written to him saying that the terms were agreed.
  • The contract was entered on the 9th September when the acceptance was received by G.
  • G is free to withdraw his offer before 9th September.
  • The contract was entered on the 5th September when the acceptance was posted, not when it was received.
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The Correct Option is D

Solution and Explanation

The correct option is (D):The contract was entered on the 5th September when the acceptance was posted, not when it was received..
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