Acceptance of Offer in Contract Law

Acceptance of an Offer

• Silence amounts to acceptance of an offer in two cases:
• Where offeree agrees that non-refusal within a specified time shall amount to acceptance
• When there is a custom or usage of trade that specifies silence shall amount to acceptance

Acceptance by Conduct/Implied Acceptance

• Section 8 provides for acceptance of a proposal by conduct, rather than verbal or written communication
• Example: A cobbler sitting with a brush and polish implies acceptance of a person giving their shoes for polishing

General Rules as to Communication of Acceptance

• The communication of an offer is complete when it comes to the knowledge of the person to whom it is made (Section 4)
• Example: If 'A' makes a proposal to 'B' by post to sell a house, the offer is communicated on the day 'B' receives the letter, not when 'B' reads it
• Two key issues to consider: modes of acceptance and when acceptance is complete

Legal Rules regarding a Valid Acceptance

• Acceptance can only be given by the person to whom the offer is made (specific offer), but can be given by anyone with knowledge of the offer (general offer)
• Acceptance must be absolute and unqualified
• Acceptance must be communicated, but not necessarily in writing

Acceptance by Post

• When acceptance is given by post, communication of acceptance is complete as against the proposer when the letter of acceptance is posted
• Example: If 'B' accepts 'A's proposal and sends acceptance by post on 14th, communication of acceptance is complete on 14th as against 'A', and when the letter reaches 'A' as against 'B'

Delayed or No Delivery of Letter

• If the letter of acceptance is posted but never reaches the offeror, or is delayed in transit, it does not affect the validity of acceptance
• The offeror is bound by the acceptance if the letter is correctly addressed, adequately stamped, and duly posted

Acceptance by Telephone, Telex, or Fax

• If communication of an acceptance is made by telephone, tele-printer, telex, fax machines, etc., it completes when the acceptance is received by the offeror

The Place of Contract

• In case of acceptance by post, the place where the letter is posted is the place of contract

Communication of Acceptance in Case of an Agent

• Communication of acceptance is completed when the acceptance is given either to the agent or to the principal
• If the agent fails to convey the acceptance received from offeree, still the principal is bound by the acceptance

This quiz covers the exceptions to the rule of acceptance of offer in contract law, including silence as acceptance and acceptance by conduct or implied acceptance.