ESSENTIALS OF VALID ACCEPTANCE

ACCEPTANCE

When the person to whom the proposal is made signifies his assent, it is an acceptance of the proposal. An accepted proposal is called a promise or an agreement. (Section 2 (b). The person who accepts the proposal or offer is known as acceptor. The acceptor should do something to signifies his intention to accept.
For example: ‘A’ offers to sell his horse to ‘B’ for Rs 500. ‘B’ accepts the offer to purchase the horse for Rs. 500. This is acceptance.

ESSENTIALS OF VALID ACCEPTANCE

1. Acceptance must be absolute and unconditional: An acceptance must be unconditional & unqualified. Accepting an offer with conditions, variations and reservation amounts to counter offer and rejection of the original offer.
For example: ‘M’ offered to sell land to ‘N’ at $280, ‘N’ replied accepting the offer and enclosing $30 and promising to pay the balance amount by monthly instalments of $50 each. Since ‘N’ accepted the offer subject to making payments in instalments, it was held that the acceptance was conditional and qualified. [Neele v.s Mrritt (1930)]





2. Acceptance must be communicated to the offerer: If the offeree remains silent and does nothing to show that he has accepted the offer, no contract is formed. The acceptor should do something to signify his intention to accept. Thus acceptance must be communicated to the offerer himself. A communication to any other person is as ineffectual as if no communication has been made.
For example: The leading case on the point is FELT HOUSE V.S BINDLEY (1862)
‘F’ offered to buy his nephew’s horse for £30- 15s, adding. “If I hear no more, I shall consider the horse is mine at £30- 15s”. The nephew did not reply, but told his auctioneer not to sell the horse, as it was sold to his uncle. But the auctioneer sold it by mistake to a third party. F sued him for conversion of his property. It was held that there was no communication of acceptance. Mental acceptance or uncommunicated assent does not result in a contract.
3. Acceptance must be made within a reasonable time: Acceptance to be valid must be made within the time allowed by the offeror and if no time is specified, it must be made within a reasonable time.
For example: The leading case on this point is RAMSGATE VICTORIA HOTEL CO. V.S MONTEFIORE (1866)
A Person applied for a share in a company in June. He cannot be bound by an allotment made late in November.





4. It must be according to the mode prescribed or usual or reasonable mode: Section 7 (2) states that if the acceptance is not made in the manner prescribed, the proposer may within a reasonable time after the acceptance is communicated to him, insist that the acceptance must be made in the manner prescribed. Failure on the part of the offerer to do so will imply that he has accepted the acceptance although it is not in the desired manner.
For example: An offer was made in the following terms. “I intend to sell my house for Rs. 1,000. If you are willing to have it writes to ‘F’ at his address”. Instead of writing to ‘F’ the purchaser sent an agent to ‘F’ and agreed to purchase. It was held that the seller was bound by the acceptance and there was no violation of section 7 when the purchaser, instead of writing to the particular person, met him personally to communicate his acceptance.
Where no mode of acceptance is prescribed, acceptance must be expressed in some usual and reasonable manner, such as mail.
5. The acceptor must be aware of the proposal at the time of the offer: If the acceptor is not aware of the existence of the offer and conveys his acceptance, no contracts come into being.
For example: ‘A’ sold his business to his manager ‘B’ without disclosing the fact to his customers. ‘C’ a customer, who had a running account with ‘A’, sent an order for the supply of goods to ‘A’ by name. ‘B ‘received the order and executed the same. ‘C’ refused to pay the price to ‘B’. It was held that there was no contract between ‘B’ and ‘C’ because ‘C’ never made any offer to ‘B’ and as such ‘C’ was not liable to pay the price to ‘B’.





6. Acceptance must be given before the offer lapses or before the offer revoked: It means that acceptance must be made while the offer is in force i.e. before the offer has been revoked or offer has lapsed.
For example: A prospective resignation to quit a post is an offer and it can be withdrawn before the resignation is accepted by a competent authority.
7. Acceptance cannot be implied from silence: No contract is formed f the offeree remains silent and does nothing to show that he has accepted the offer
For example: The leading case on this point is BROGDON V.S. METROPOLITAN RAILWAYS CO. (1877)
A draft agreement relating to the supply of coal was sent to the manager of a railway company for his acceptance. The manager wrote the word ‘approved’ on the agreement but by an oversight, the document remained in his drawer. Held there was no contract as it was only mentally accepted and there was no expression of his mental determination.