THE LAW OF CONTRACT

The Law of Contract



The Law of Contract

1- Referring to the scenario Olive is liable to Paul and Quentin The postal rule concerns to communications of acceptance by cable, encompassing telegram, but not to instantaneous modes such as telephone, telex and fax. The postal rule will not apply:

•(i) Where the letter of acceptance has not been properly dispatched, as in Re London and to the north Bank (1900), where the letter of acceptance was presented to a postman only authorised to deliver posted letters and not to collect it. (Sealy, L.S. 2001 Pp. 16)

•(ii) Where the note is not properly addressed. There is no authority on this point.

•(iii) Where the express periods of the offer exclude the postal direct, ie if the offer identifies that the acceptance must come to the offeror. In Holwell Securities v Hughes (1974, below), the postal rule was held not to request where the offer was to be acknowledged by "notice in writing". Actual communication was required. (Halsbury's Laws 2007 Pp. 12)

(iv) It was said in Holwell Securities that the rule would not be directed where it would produce a "manifest inconvenience or absurdity". There should be an offer and this should be accepted to make an agreement. While this would in the first example appear to be self explanatory, it is significant to distinguish between what the regulation states allowances to a valid offer. An offer can be made orally, in composing or by way of conduct. Regardless as to the kind of the offer, it is the enthusiasm or aim of the individual making the offer (the offeree) which is of significance, and that is clearly subjective. If a individual states that I desire to sell this orange for £1.00 but then mistakenly advertises it for 1p, and that offer is accepted, then a legitimate agreement will be upheld. Simply because there was a error in the offer, it does not invalidate the contract. There was an aim to sell on the part of the offeree. It is important to differentiate at this issue although between an offer and an “invitation to treat”.

In this case Olive is liable to Paul because If acceptance by post has been requested or where it is an appropriate and reasonable means of communication between parties, acceptance is complete as soon as the acceptance is posted, even if the letter is delayed, destroyed or lost in the post so that it never reaches the offeror. The rule supposess that agreement breakers realise the natural consequences of their break but where the deficiency exceed those parameters, it should be shown that the contract breaker was aware of the exceptional attenuating factors when the agreement was went into into. The test was further evolved in Victoria Laundry v Newman commerce (1949) where it was held that the test for remoteness is if the decrease is reasonably foreseeable as a liable outcome, and depends on the defendant's knowledge. Finally, in the Heron II (1969), the test laid down ...