The Sales of Goods Act,1930
--
Indian Contract Act ,18 .
Business laws Lecture -8
14
By- Kunal Mandhania
Recap of previous
lecture
1 of
Invitationa
2
4
Topics to be
1 Acceptance.
covered
2 communication of offer
and Acceptance .
4
2)
Acceptance
.
-
Definition Hear
fo
[ .
T G
.
-
(B).
.
-
Rules/Essentials-valid. -
A -
whom
when person to ① Acceptance must be absolute and
·
was made . merret).
proposal unqualified. (Neale Is
↓ to
gives his apent / ② Acceptance can be made by party
consent whom offer was made(Boulton VS Jones).
↓ should be communicated to
he is said to make ③ Acceptance
().
metropolitan railway
offeror (Brogden is.
valid acceptance to acceptanc
not amount
a
④ mere silence will
Proposal when
·
should be wade within fried
⑤ Acceptanc
accepted becomes time or reasonable time before offer lapse.
acceptance/promise -
should be in some
⑥ A zcep tance made
usual mode .
usual
-
prescribed mode or
Phrase - - Acceptance to offer
is like lighted match
filled with gun powder .
-
Is to rain
Anson :
=
offerree
made had full
Explanation ⑦ when offer was
, party
. But if offerree gives
-
it
opportunity
O to reject
it becomes
promise or a
acceptance ,
then
cannot
a obligation and after acceptance offeree
or withdrawn or revoke the promise.
reject
train filled with gun powder
similarly
once
stop destruction
is lighted ,
then no
body can the
Di Here train with gunpowder is
symbolised
as
offer. and lighted match stick as acceptance.
and Acceptan
o ffer
a
of
communication knowledge
-
to
offer Comm -
.
When offer comes
of offere
=
complete . .
comes to
When acceptance
Acceptance -
Comm" complete knowledge of offeror .
comes to
When is
when acceptance
contract -
knowledge of offeror
:
made
By Later
When communication complete.
↑
-
to
Ser [
Acceptance
H
↓ f ↓
When
comes
offer
to [
Agains
offeren
-Against
Accepto
Ax
knowledge to
When acceptance When acceptance
of letter is Comes to
offeree posted i e
.
knowledge
into course
(Secy) put of offeror
-
.
of transmission .
-
offelar
Eg Acceptor
.
-
-
G
10 Jan 10 Jan i
san
-
Anurad
offer
letter
Leach
17 Jan
sop
send
: Kunal - 18 Jan
read.
* [18 Jan
Y
sola 19 Jan
seel & 193 an.
Acceptance
-
- Reach .
letter
als
#27
F
san
273
.
2 - - --
post
Solution !
=
① offer comm complete -Jan. --
② When is communication
of
acceptance complete
.
letter
19Tan-when acceptance
⑨ Against offero -
posted
Acceptive 27
⑥ Against
an
revoke offer s before posting
③ Till when can offeror letter it befor
acceptance19 time
July-post
Till when can acceptor >
- Before acceptance
-
Before
revace -
accep tance letter reach offere 27 Jan.
contract made 19 Jan
⑤
-
When is
T
To be continued , - -
make-proposal
=
promise -
-
.
Waept
.
ACCEPTANCE
Definition “When the person to whom the proposal is made signifies his
⑤and
Section 2(b) assent thereto, proposal is said to be accepted.
According to Sir William Anson “Acceptance is to offer what a lighted match is to a train of
1Q
. .
Al
gun powder”. Acceptance converts the offer into a promise and then it- is too late to revoke it. This
/
-
-
means as soon as the train of gun powder is lighted it would explode. Train of Gun powder [offer]
in itself is inert, but it is the lighted match [the acceptance] which causes the gun powder to explode.
di The significance of this is an offer in itself cannot create any legal relationship but it is the
B acceptance by the offeree which creates a legal relationship. Once an offer is accepted it becomes
C
a promise and cannot be withdrawn or revoked. An offer remains an offer so long as it is not
f accepted but becomes a contract as soon as it is accepted. and
party has to perform
obligation cel
Legal Rules regarding a valid acceptance
1. Acceptance As per section 7 of the Act, acceptance is valid only when it is absolute
counter
conditional acceptance
must be and unqualified I =
absolute and
Acceptance support
.
offer.
X
-
unqualified
G
M offered to sell his land to N for £280. N replied purporting to accept the
offer but enclosed a cheque for £ 80 only. He promised to pay the balance
ain
-
&
of £ 200 by monthly instalments of £ 50 each. It was held that N could not
-
exam
-
enforce his acceptance because it was not an unqualified one. [Neale vs.
Merret [1930] W. N. 189].
2. Acceptance can In case of a specific offer, it can be accepted only by the person to whom
be given only by it is made Blocklehort-esones
the person to ↓
whom offer is Boulton-
Case Law: Boulton vs. Jones (1857) -
made
Facts: Boulton bought a business from Brocklehurst. Jones, who was
come Broklehurst’s creditor, placed an order with Brocklehurst for the supply of
can -
certain goods. Boulton supplied the goods even though the order was not
same in his name. Jones refused to pay Boultan for the goods because by
= entering into the contract with Blocklehurst, he intended to set off his debt
against Brocklehurst. Held, as the offer was not made to Boulton,
therefore, there was no contract between Boulton and Jones
3. The acceptance To conclude a contract between the parties,the acceptance must be
must be communicated in some perceptible form
communicated
Brogden vs. Metropolitan Railway Co. (1877)
Facts: B a supplier, sent a draft agreement relating to the supply of coal
Exam to the manager of railway Co. viz, Metropolitian railway for his acceptance.
ente The manager wrote the word “Approved” on the same and put the draft
agreement in the drawer of the table intending to send it to the company’s
solicitors for a formal contract to be drawn up. By an over sight the draft
Business Laws 17 | P a g e
thenaccept
mal a
give acceptanc by
-
↑
4. Acceptance
must be in the
O
prescribed mode
agreement remained in drawer. Held, that there was no contract as the
manager had not communicated his acceptance to the supplier, B
Where the mode of acceptance is prescribed in the proposal, it must be
accepted in that manner. But if the proposer does not insist on the
proposal being accepted in the manner prescribed after it has been
accepted otherwise, i.e., not in the prescribed manner, the proposer is
presumed to have consented to the acceptance
5. Time Acceptance must be given within the specified time limit, if any, and if no
time is stipulated, acceptance must be given within the reasonable time
and before the offer lapses
6. Mere silence is The acceptance of an offer cannot be implied from the silence of the
not acceptance offeree or his failure to answer, unless the offeree has in any previous
conduct indicated that his silence is the evidence of acceptance
answereCase Law: Felthouse vs. Bindley (1862)
wa
should Facts: F (Uncle) offered to buy his nephew’s horse for £30 saying “If I hear
no more about it I shall consider the horse mine at £30.” The nephew did
oftencontainof
&
① not reply to F at all. He told his auctioneer, B to keep the particular horse
Amendi
out of sale of his farm stock as he intended to reserve it for his uncle. By
a
compliance
mistake the auctioneer sold the horse. F sued him for conversion of his
to property. Held, F could not succeed as his nephew had not communicated
ste
amount
be
the acceptance to him.
acceptance .
notamon
② mere silence will
Define the term acceptance under the Indian Contract Act 1872. Explain the legal rules
regarding a valid acceptance. (7 marks) Jan 21
Communication Of Offer and Acceptance
1. When the contracting parties are face-to-face, there is no problem of communication because
there is instantaneous communication of offer and acceptance
2. The difficulty arises when the contracting parties are at a distance from one another and they
utilise the services of the post office or telephone or email (internet)
3. Communication of offer: In terms of Section 4 of the Act, “the communication of offer is
complete when it comes to the knowledge of the person to whom it is made”. offerree .
=
4. Communication of acceptance – (sec 4) Egst !
(i) As against the proposer, when it is put in the course of transmission to him so as to be out of
the power of the acceptor to withdraw the same;
(ii) As against the acceptor, when it comes to the knowledge of the proposer.
For instance in the above example, if ‘B’ accepts, A’s proposal and sends his acceptance by post
on 14th, the communication of acceptance as against ‘A’ is complete on 14th, i.e. when the letter
is posted. As against ‘B’ acceptance will be complete, when the letter reaches ‘A’.Here ‘A’ the
proposer will be bound by B’s acceptance, even if the letter of acceptance is delayed in post or lost
in transit
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