...research after receiving your mail last week regarding some questions of the postal rule of acceptance and the case of Masters v Cameron (1954) 91 CLR 353. After researching those issues, and based on acceptance set out below, I believe that you will obtain some exact concepts of acceptance on the contract. Thus, I will explain the postal acceptance rule and whether it still operates in Australia or not, discuss how businesses generally modify the postal acceptance rule, and conclude the case of Masters v Cameron more fully below as I understand them. * Postal Acceptance Rule The postal acceptance rule or the mailbox rule, created in 1818, is a term of common law contracts and affect communication of acceptance. It is defined as acceptance by post has been requested or use an appropriate and reasonable means of communication between the parties, then acceptance is taken effect immediately upon the letter posted. This rule determines the timing of acceptance of an offer when mail is concerned as the medium of acceptance. The general principle is that a contract is formed when acceptance is actually communicated to the offeror. Thus, an offer made by letter is not effective until or unless received by the offeree. Acceptance is effective as soon as it is posted. The major case in the postal acceptance rule is Adams v Lindsell (1818) B & Ald 681 that a contract was formed when the acceptance letter was posted. As the case described, Adams posted a letter to Lindsell, offering...
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...Clarification of Rules of Acceptance in Making Business Contracts Dr. Md. Abdul Jalil Associate Professor of Law Department of Business Administration, Faculty of Economics and Management International Islamic University Malaysia (IIUM) E-mail: abduljalil@iiu.edu.my, abd_jalil2@yahoo.com Abstract Business firms and Business corporations enter into thousands of contracts everyday. Making a formal and written contract is very important for business corporations and firms although oral contracts are accepted and recognized by law. There are certain rules on making a valid formal contract. If the business firms do not have knowledge of those contract formation rules and they make contracts in ignorance of those rules, their contracts would be liable to be declared as null and void by the court of law if it is referred to it to determine its validity or to get a remedy for breach of contracts by one of the parties in the contract. In this paper I have not discussed all the elements of a valid contract. I have discussed only one of the fundamental elements of a valid contract that is ‘acceptance’. In a business contract, there must have be an ‘offer’ and an ‘acceptance’, to make a valid contract, if not the contract will not be valid, recognized and enforceable in the court of law. The objective of this paper is to clarify the rules of making a valid ‘acceptance’ which may lead to making a binding contract between the parties. Keywords: Offer, Acceptance, Rules of acceptance, Communication...
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...PRESENTED: Should Postal rule be discarded? In the paper we will discuss the postal rule and simultaneously take up the case laws related to the particular issue. First, we will introduce the postal rule. After that, we will point out the main features. At last we will critically analyse the rule and conclude. The whole paper is based on the English jurisdiction. When the parties are located at a distance from each other and are contracting through postal communication it is difficult to decide when the contract is concluded. There are two possibilities in such a case: 1. The contract is concluded when the acceptance is posted. 2. The contract is concluded when the acceptance is received. A similar situation arose in Adams v. Lindsell. On September 2, 1817, the defendants sent a letter offering to sell wool to the plaintiffs. The letter reached the plaintiffs on 5th of the same month. The plaintiffs posted the acceptance on the same evening but it reached the defendants on September 9. The defendants waited till September 8 and then sold it to some other party. They were sued for the breach of contract. The defendants argued that there should have been no binding contract unless and until the plaintiff’s answer is received by them and, therefore, they were free to sell the wool to some other party on September 8. But the court said: If it were so, no contract could ever be completed by post. For if the defendants were not bound by their offer when accepted by the...
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...the handbag; otherwise, he would sue her for breach of contract. This legal issue is that whether there are both valid offer and acceptance bringing Cindy into a legally binding contract and the display of handbag in Lam’s shop is either an offer or an invitation to treat. A legally binding contract requires five essential elements, which are offer, acceptance, consideration, intention to form a contract and capacity. Where all these elements are present, a legally binding contract comes into effect. An offer is an expression of willingness by a person to contract on certain terms which must be clear and capable of acceptance by another person. It can be made in any form by the offeror and should be communicated to the offeree to become effective. But what words are used is unimportant. Invitation to treat is simply an expression of willingness to enter into negotiations which, it is hoped, will lead to the conclusion of a contract at a later date. Generally, a statement to a specific person usually constitutes an offer. Meanwhile, a statement such as general advertisement or a display of goods is usually an invitation to treat because it is made to a very large group of people. An acceptance is a final and unqualified expression of assent to the terms of the offer, which may be in forms of writing, oral expression, electrical means or conduct. There are several established rules on acceptance. One of them is acceptance must be communicated to the offeror. In Pharmaceutical...
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...case, first and foremost we need to identify this is an invitation to treat or an offer or proposal. An offer should be contrasted with an option and an advertisement. According to Section 2(a), Usop has made an offer or proposal to sell his car with a price RM 8 750 and he provided enough details for an offeree to reach him. The first person who see the advertisement is Sarah. On Monday morning, Sarah called Usop and offer RM8000 to buy the car instead of RM 8 750, the price offer by Usop. However, Usop neither agree or disagree to the offer. Then later, Usop decided to sell his car to Sarah by posting a letter of agreement, however when he read Betty’s notice, he decided to withdraw his proposal to Sarah. The issue arise here, either the acceptance is complete or not? Whether an agreement between Sarah and Usop is properly formed and either Usop can revoke the acceptance once he posted the letter of agreement? If the acceptance is complete and an agreement is formed, there is no question of revocation. On the other hand, the issues between Betty and Usop is regarding the communication of acceptance.Whether the communication of the proposal is completed or not between Betty and Usop and when the communication is completed between them?. As we see in case of The Best Deal, the communication of acceptance by Betty is complete, however, it is questionable when the completion of the acceptance of communication take place either at 11.00 a.m. when Betty left message or at 4.30...
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...Lecture 2 – Offer & Acceptance Principles of contract law: Contract Formation - How a Contract is Made Terms - The Substance of Contract Vitiating Factors - Factors which Undermine a Contract Discharge - How a contract is fulfilled or ended Remedies - The Cures for a Breach of Contract For a contract to be legally binding, it has to fulfill 4 key elements: 1. Offer 2. Acceptance 3. Consideration 4. Intention to create legal intentions A. TYPES OF CONTRACT (pg 60) • Simple Contacts o Written o Oral • Special Contracts o Contracts by deed or contracts under seal o Always in writing o Written document is called a deed o Contracts under seal do not require consideration to be enforceable Written and Oral Contracts (pg 60) (1) Oral Contracts (Parol Contracts) o Difficult to ascertain the precise terms of the contact in event of dispute (2) Written Contact o Useful as it provides evidence of the parties’ contractual obligations o Forefront Medical Technology (Pte) Ltd v Modern Pak Pte Ld (2006) o Contracts for certain transactions must be evidenced by a written note of memorandum otherwise they are unenforceable Eg. Assignment of copyright and transfer of real property # NOTE: Parol Evidence Rule Primacy of a written agreement over oral statements : Oral (Parol) evidence will not be admitted in a court action to add to , vary, amend or contradict a written contract - Evidence Act S94 – Engelin Teh Practice LLC v Wee Soon Kim Anthony (2004) *Exceptions*: Extrinsic...
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...The postal rule (of acceptance) is the fifth and last of the relevant sub-rules affecting communication of acceptance. It can be summarized as, “If, and only if, the postal service is an acceptable method of communication between offeror and offeree, a letter of acceptance takes effect immediately upon posting, rather than upon receipt, and acceptance is therefore taken to have been communicated (to the offeror) at the time of posting the letter.” The rule itself was established in the 19th Century when the only communication between mutable parties was to deal wit each other via mail. There was none of the types of communication that we have today. Thus contracts were created face-to-face or by correspondence. The rationale for the creation of the postal law came form the case Adams v Lindsell which involved the sale of wool between two parties, the defendant wrote to the plaintiff about the selling of some fleeces and required an answer via the post. The response letter was misdirected and not received till three days later and the plaintiff posted there letter on the same day but was not received until four days latter. On the day before it arrived the defendants not having received a reply by the date they expected sold all of the wool. The defendant agued that there could not be a contract until the letter was received. The judgment of this was that if contracts were not created until the acceptance letter was received then...
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...posted an offer on Monday 2 June by letter to Naiker but his offer was delayed by postal strike. Upon receiving Ahmad’s offer on Thursday 5 June, Naiker wants to seize the opportunity and wrote back an immediate letter of acceptance to Ahmad on Friday 6 June. However, Naiker’s letter of acceptance was delayed again and only reaches Ahmad on Monday 9 June. In the meantime, when Ahmad did not receive any replies from Naiker and believed that he is not interested in purchasing the piano anymore, and hence sold the piano to Janice, the third party in this case. [Issues] The issue is whether there is an enforceable contract even though Ahmad has no control over the postal strike that delayed the arrival of both the letter of offer and acceptance. At the same time, whether Ahmad is responsible for Naiker's loss of piano since he was unaware of the acceptance letter that was posted on Friday 6 June and only till it arrived on Monday 9 June and hence, Ahmad did not post any revocation of offer to Naiker. These can be supported by Agreement, Postal Rule and Revocation of Offer by Offeror. [Relevant Law and Application] Agreement is one of the essentials needed to form a contract. In terms of making an agreement, there must be an offer and an acceptance in return. In this case, it was clear that Ahmad has posted an offer by letter to Naiker and Naiker has also returned an immediate letter of acceptance back to Ahmad. Despite having delays for the letter of acceptance to reach Ahmad...
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...fax ‘Cheque preferred for advertised amount. Yours for that unless I hear from you on the contrary.’ On receipt of the fax Chris posted a Cheque for $10,000. However at 6:45pm on Friday evening, Tom decided not to sell the car to Chris and sent a fax to him to his office to tell him so. The office had closed for the weekend when the fax arrived. Chris did not see it until earlier Monday morning. Chris’s letter arrived at tom’s address on Saturday but was not opened by him until late Monday morning. On Saturday tom sold the car for $8,000 in cash. Chris now claims that tom is in breach of contract. Advise Chris of his legal position. 1st Issue Is Tom’s advertisement in the Weekly Motor Sports Magazine an offer or an invitation to treat? * Rule or Law: A preliminary stage in which one party invites the other to make an offer. * Advertisements for a bilateral contract These are the type of advertisements which advertise specified goods at a certain price,...
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...whether there is a valid contract or the offer may be terminated. In order to the contract being valid and enforceable, there is a need for the conduct of an offer and an acceptance. Rule For an offer to be valid, it contains some rules, including lapse of time. When an offer is made, it does not last forever. An offer stated to open for a specific period, lapse if the there is no acceptance within that time. If there is no set time for acceptance is stipulated in the offer, the implication of lapse will be exercised after a reasonable time, depending on the facts and circumstances in each case. (see Ballas v Theophilos (No2) (1957) 98 CLR 193; [1957] HAC 90). If the acceptance is come after the offer has lapsed, the acceptance will not be valid. Application In this case, Chan offers to sell his car to David and David asked for some time to think about it. It can be noticed here that David gets back to Chan after long time thinking, which caused the offer lapse. Moreover, there is no binding options about specific period is stipulated to keep the offer open for offeree. The acceptance is not valid because the offer has been terminated due to the lapse of time. Conclusion There is no legally binding contract which has been formed between Chan and David. Case 2 Issue This problem indicates the issue about breach of contract. However, breach of contract only occurs when a legal contract has been formed. Therefore, a second issue is also addressed, whether a contract is valid. In terms...
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...dealer placed an advertisement in a weekly motor sports magazine offering to sell a triumph (Tr6)for $10,000. RULE OF LAW: Rule of law for an Offer - is a statement of willingness of a contract on specified terms if accepted, it shall become a binding contract. Argument/Counter Argument: firstly, the advertisement was public to the eyes of citizens and it will attract interested outsiders, because of an invitation to treat. Whereas, Chris acceptance to the advertisement leads to a binding contract with the offeror, Tom. After he saw advertisement he immediately posted an acceptance letter with $8000 cash, alongside his office fax number. The offer was accepted when chris sent the letter to tom accepting the offer. Both parties communicated by fax, when the letter itself was sent to the offeror in which Tom read it and accepting the check. -According to the case of Carlill vs Carbolic Smokeball, the defendant manufactured a "Smokeball" to prevent flu and whoever used it over a specified period of time, each will receive $100. Carlill saw the advertisement, which states an invitation to treat. She used the Smokeball under her specified terms and still caught the flu. She went to collect her $100 benefit but the company refuses to pay her. When the claim was made they said there was no contract. It was held that an offer made to the world at larg, can become a contract with those who fulfilled the conditions. Based on the conditions, Chris performed within the conditions of using...
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...Element of contract The objectives of element of contract are to explain the requirement of a valid offer and acceptance which lead to the formation of a contract provided other essential elements, In other word intention to create legal relations and ,in most cases, consideration are also present. problem also arise in connection with the need for writing in some cases and the capacity of the parties. That it decides that where an offer is in the form of a promise for an act, the performance of the act is the acceptance and that offers of this type may be made to a particular person or to the world at large ,In other word to any unmentioned person or persons. Definition of contract A contract may defined as an agreement enforceable by law between two or more persons to do or abstain from doing some act or acts, their intention being to create legal relation and not merely to exchange mutual promises. I order to decide whether a contract has come into being, it is necessary to establish that there has been agreement between the parties .In consequence, it must in general be shown that an offer was made by one party(called the offeror )which was accepted by the other party(called the offeree).i Offer is one of the elements that make for a valid contract, and is the main focus of our lesson.there are six elements to a contract. These elements include, offer, acceptance, consideration, capacity, form a contract Offer Offer is an announcement of a person willing to...
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...1(2007) The Postal Acceptance Rule in the Digital Age∗ Dr. Marwan Al Ibrahim Asst. Professor in commercial and Company law, Amman Arab University for graduate studies – Jordan Dr.Ala’eldin Ababneh Assistant Professor in Private Law at Amman Arab University for Graduate Studies-Jordan. Mr. Hisham Tahat PHD student, University of Aberdeen Abstract: This article examines the application of the postal acceptance rule to email acceptances. Different views have been argued against the application of traditional rule like the postal acceptance rule, which was established in 1818 as a legal norm in contract formation to modern communications like the email. The paper presents the arguments and rationale behind the application of this rule and contends its applicability to the modern communication via e-mail. The paper posits that email is not an instantaneous method of communication, but can be viewed as a digital version of the normal post and thus the postal acceptance rule should apply to this kind of contracting. Keywords: E-commerce, Email, Contract law, Conclusion of Contract, Postal Acceptance Rule. 1. Introduction The conclusion of distance contracts has been one of the controversial issues in the law of contract formation. It raises some question marks, especially with regard to the type of rules that should govern the timing of contract formation. More specifically, a strong debate has been emerged recently as to whether the postal acceptance rule may apply in respect...
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...1(2007) The Postal Acceptance Rule in the Digital Age∗ Dr. Marwan Al Ibrahim Asst. Professor in commercial and Company law, Amman Arab University for graduate studies – Jordan Dr.Ala’eldin Ababneh Assistant Professor in Private Law at Amman Arab University for Graduate Studies-Jordan. Mr. Hisham Tahat PHD student, University of Aberdeen Abstract: This article examines the application of the postal acceptance rule to email acceptances. Different views have been argued against the application of traditional rule like the postal acceptance rule, which was established in 1818 as a legal norm in contract formation to modern communications like the email. The paper presents the arguments and rationale behind the application of this rule and contends its applicability to the modern communication via e-mail. The paper posits that email is not an instantaneous method of communication, but can be viewed as a digital version of the normal post and thus the postal acceptance rule should apply to this kind of contracting. Keywords: E-commerce, Email, Contract law, Conclusion of Contract, Postal Acceptance Rule. 1. Introduction The conclusion of distance contracts has been one of the controversial issues in the law of contract formation. It raises some question marks, especially with regard to the type of rules that should govern the timing of contract formation. More specifically, a strong debate has been emerged recently as to whether the postal acceptance rule may apply in respect...
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...Question 2 (a) Under contract law, this problem is engage with the postal acceptance rule which is a ‘term of common law contracts which determines communication between the parties by mail when a contract has been composed. The basic idea of the rule is to accept offer that is sent before received the revocation of the offer. However, if a communication is sent rejecting the offer, and a later communication is sent accepting the contract, then the first one to be received by the offerer will prevail’ (Contracts Law: Mailbox Rule, n.d). The issue in this case is whether there has been a valid acceptance of the offer to create a legally binding contract between Benny of Azman’s. According to Section 2-(a) of Malaysian Contracts Act 1950, ‘when a person signifies to another his willingness to do or to abstain from doing anything, with a view to obtaining the assent of that other to the act or abstinence, he is said to make a proposal’. Section 2(b) states that ‘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’. Generally, silence of the offeree does not constitute an acceptance of the offer even though the offerer would consider offeree's silence. In accordance to another case, Felthouse v Bindley (1862) EWHC CP J 35 (Court of Common Pleas, n.d, the offerer wrote the offer mail to his nephew to buy his horse saying "If I hear no more about him, I consider the horse mine...
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