The postal rule is an exception to the general rule that acceptance is only

The postal rule is an exception to the general rule

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- The postal rule is an exception to the general rule that acceptance is only completed when it is communicated to the proposer. - s.4(2) provides that the communication of an acceptance is binding (a) On the proposer, when the acceptor puts the acceptance in a course of transmission to the proposer in such a manner so as to be out of the power of the acceptor and (b) On the acceptor, when the acceptance comes to the knowledge of the proposer. - An example is given in illustrating (b) to s.4(2) where if B accepts A’s proposal by a letter sent by post, the communication of the acceptance is complete (a) As against A, when the letter is posted and (b) As against B, when the letter is received by A. - In Ignatius v Bell [1913] , it was held that an acceptance which had been posted but did not reach the offeror on time was good acceptance. OTF, the parties had contemplated on the use of the post as the means of communication of acceptance. The risk was on the offeror. - Example using the diagram: (a) The communication of acceptance is completed and binds A the moment B posted his acceptance on 5th Jan. The fact that the letter does not reach A or being delay do not matter as its A risk. (b) B’s acceptance will make him binding once his letter of communication reaches A ( comes to A’s knowledge ) on 7th Jan. 1 Jan 3 Jan O ff er Acceptance 7 Jan 5 Jan
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Revocation of Proposals and Acceptances: (A) Proposals There are several ways in which a proposal may come to an end 1. Rejection Once the proposal is rejected, it is terminated. A counter-offer containing terms not in the original offer would also cause the offer to come to an end: Hyde v Wrench. However, a proposal is not rejected merely by asking or requesting for further information: Stevenson v McLean . 2. Lapse of time A proposal may lapse through time. s.6(b) provides that a proposal is revoked by the lapse of time prescribed in the proposal for its acceptance, or if no time is prescribed, by the lapse of reasonable time. What is a reasonable time is a question of fact and depends on matters like the nature of the subject matter and the mode to used to communicate the offer. 3. Failure to fulfil a condition precedent to acceptance s. 6(c) provides that a proposal is rejected by the failure of the acceptor to fulfil a condition precedent to acceptance. In Aberfoyle Plantations Ltd v Khaw Bian Cheng (PC) [1960] , the plaintiff and the defendant had entered into a sales and purchase agreement for the sale of a rubber plantation. The agreement was conditional upon the vendor obtaining an extension of the lease. The purchaser paid a deposit under the agreement and the vendor failed to get an extension of the lease. The PC held that since the condition was not fulfilled, there was no contract. Thus, where a proposal is conditional and the condition is not satisfied, the proposal will lapse as provided for under s.6(c) .
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  • Winter '17
  • Daniel

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