Acceptance, Contract Law and email

Hello,

I have a question where:

Barry makes an advert for a bottle of wine (invitation to treat). Claire emails barry asking for three (offer).

At 10pm Barry checks his email and replies to Claire confirming her order and stating that the wine will be dispatched upon receipt of a cheque for the full amount payable.

Clarie watches a wine show and finds out the wine sucks. At 11pm she rings Barry to cancel but Barry says it's too late. Claire checks her email and there is the confirmation email from Barry.

My questions:

1.

Is Barry's reply an acceptance?

2.

A counter-offer as "sending out the item on receipt of payment" could be classed as a condition?

3.

A counter-offer as "payment via cheque" could be seen as a condition?

4.

The email is acceptance and the last bit of the sentence is consideration - Barry is promising to send the item when Claire has sent the payment. As far as I can tell Claire asking for three is a promise that she will pay.

5.

How does email communication work with acceptance? Is the acceptance binding as soon as the email is sent? Do you have any cases/references to back this up?

Thanks!

Reply 1

zillysteph

1

Kemik

Hello,

I have a question where:

My questions:

1.

Is Barry's reply an acceptance?

2.

A counter-offer as "sending out the item on receipt of payment" could be classed as a condition?

3.

A counter-offer as "payment via cheque" could be seen as a condition?

4.

The email is acceptance and the last bit of the sentence is consideration - Barry is promising to send the item when Claire has sent the payment. As far as I can tell Claire asking for three is a promise that she will pay.

5.

How does email communication work with acceptance? Is the acceptance binding as soon as the email is sent? Do you have any cases/references to back this up?

Thanks!

just intrigued as to why you want to know when it says you study accounting...

Reply 2

Kemik

OP

14

I do a law module. It mainly goes in to contract law.

Reply 3

zillysteph

1

right ok

so...yeah barry's phone call is an acceptance, and the consideration is her paying him the cheque. I don't see why you have classed this as a counter-offer, nothing about the original offer has changed.

in terms of whether it still counts as valid acceptance as she only opened up her email is all down to your argument. If you follow the case law on the postal rule, i.e. once a letter is posted, that classifies as an acceptance irrespective of when the recipient receives/opens the letter, then you could say the acceptance is binding. However there is no law on email as of yet, unless some has been developed in the last year (i studied contract last year).

Here is an extract from one of my essays on postal rules/emails from last year

"The law particularly in new modern forms of communication like e-mail is very unclear and as said by Lord Wilberforce in Brinkibon v Stahag Stah und Stahlwarenhandels GmbH , ‘No universal rule can cover all such cases: they must be resolved by reference to the intentions of the parties, by sound business practice and in some cases by a judgment where the risks should lie’. It unfortunately leaves defendants and claimants unsure of where they stand legally. If the postal rules are in effect, and we are applying them to e-mail as well, then under Adams the relative speed it takes each method of communication to arrive at its destination is irrelevant given that the offer or the acceptance (whichever formality is being stipulated) is binding from the moment it is actioned, so for posting – the moment the letter is placed in the post-box and for e-mail the moment the sender presses the send button on their computer.

The alternative is that the postal rule should not be applied to e-mail given the fact that the sender will usually be made aware of whether their e-mail has been sent or not; and instead there should be an application of the rule governing instantaneous methods of communications, like telefax and telecommunication as set out in Entores Ltd. v Miles Far East Corp. This sets out that acceptance must be both communicated and received for a contract to be formed. "

Hope this helps :smile:

Reply 4

Kemik

OP

14

Thanks Zillysteph. The reason I was asking if Barry's confirmation email is acceptance is because he states "the wine will be dispatched upon receipt of a cheque for the full amount payable."

I wasn't sure if him saying payment by cheque is a condition. Maybe she wants to pay by cash? Or maybe I'm looking in to it too much :P

Your extract really helped though. I'm gonna do some research on that case and see if I can include it.

So far I've pinned the case down to having three outcomes. One, Barry's email is a counter-offer due to requesting payment by cash. Claire isn't bound. Two, Barry's email is acceptance and the email should be treated with the postal rule, therefore revocation was too late. Claire is bound. Three, Barry's email is acceptance but it has to be communicated to Claire. Claire revoked the offer successfully before receiving acceptance and so she isn't bound.

Do you believe the question is mainly aiming for an answer of "it depends on how email is looked at?"

Reply 5

redjon1

Kemik

So far I've pinned the case down to having three outcomes. One, Barry's email is a counter-offer due to requesting payment by cash. Claire isn't bound. Two, Barry's email is acceptance and the email should be treated with the postal rule, therefore revocation was too late. Claire is bound. Three, Barry's email is acceptance but it has to be communicated to Claire. Claire revoked the offer successfully before receiving acceptance and so she isn't bound.

Sounds good.

Kemik

Do you believe the question is mainly aiming for an answer of "it depends on how email is looked at?"

You certainly need to discuss that, but I'm not sure I'd go so far as to say that that's what the question is "mainly aiming for". Zillysteph is right about the law not being settled with regard to e-mails, but it would be extremely surprising if the courts chose to apply the postal rule because (a) the postal rule is arbitrary and much-criticised and (b) there is now some weight of authority supporting a different rule for instantaneous methods of communication (Entores, Brinkibon, Mondial v Astarte).

Reply 6

gedmcvay

See case law Golden Ocean group Ltd v Salgaocar mining Industries pvt (2012).
Hope this helps

Reply 7

DeanTJ1995

1

Original post by gedmcvay

See case law Golden Ocean group Ltd v Salgaocar mining Industries pvt (2012).
Hope this helps

I think you're about six years too late here...

Reply 8

Nas7eef

1

Hello Zillysteph,What if in a situation where, the offerror states that he wants an answer by Friday (x date) at 4.00pm. The offerree sends acceptance via email but the business server was down and the offeror could not access his emails until lets say Saturday (x 1 date) 2.00 pm. Is there a contract formed at this stage? Or is it the responsibility of the offerror to wait until the maintainence is over to check his emails basis that he provided email as a means of communicating acceptance and should have taken such situations into consideration?

Reply 9

RAY RICS

0

Original post by Kemik

Hello,

I have a question where:

My questions:

1.

Is Barry's reply an acceptance?

2.

A counter-offer as "sending out the item on receipt of payment" could be classed as a condition?

3.

A counter-offer as "payment via cheque" could be seen as a condition?

4.

The email is acceptance and the last bit of the sentence is consideration - Barry is promising to send the item when Claire has sent the payment. As far as I can tell Claire asking for three is a promise that she will pay.

5.

How does email communication work with acceptance? Is the acceptance binding as soon as the email is sent? Do you have any cases/references to back this up?

Thanks!

Firstly, in the case of instantaneous communication such as e-mail the moment it is sent is the moment that it counts regardless of when it is actually read by the recipient.

However, Barry's reply is NOT an acceptance as he has added a new term relating to the method of payment which Claire did not include in her offer to buy. Maybe Claire doesn't have a check book, maybe she wanted to use her funds in Paypal or her credit card or maybe she expected to receive the goods before paying for them. So Barry's reply is, in fact, a counter offer.

Notwithstanding this, Claire is protected by the Consumer Contracts Regulations https://www.which.co.uk/consumer-rights/regulation/consumer-contracts-regulations which replaced the distance selling regulations and, as such will have the right to cancel within 14 days, even if Barry was successful in arguing that a contract to buy the wine / sell was formed by their exchanges.

Furthermore, there would be an implied term that the wine was of reasonable quality, unless Barry's advert stated that it was not, which I doubt as Claire would have not changed her mind about it if the already knew it was poor quality, so Clair could make a claim of mis-representation and have the contract (if it existed and could not be cancelled within 14 days in any case) and move to have the contract rescinded.

So, Barry would not be able to force Claire to continue with the purchase of the wine on those three counts.

To summarise: -

No valid acceptance hence no contract.
Cancelable within 14 days under Consumer Contracts Regulations
And rescindable if Claire could prove mis-representation.

Ray

Reply 10

Mimir

20

Original post by Nas7eef

.

Original post by RAY RICS

Ray

Thanks for your replies, and the very comprehensive answer, but please do try not to resurrect threads from 2007 :smile:

Acceptance, Contract Law and email

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