Introduction

The general rule is that acceptance must be communicated.

Method

An offeror may stipulate the mode of communicating acceptance. If so, the offeree must comply or use an equally effective method.

• Tinn v Hoffman & Co. (1873) 29 LT 271

  Facts:

  In a letter, the defendant offered to sell the plaintiff iron and requested reply by return of post.

  Issue:

  Did acceptance have to be by post?

  Held:

  Honeyman J: An equally expeditious method will suffice, such as a telegram or even a verbal message.

• Yates Building Co. Ltd v RJ Pulleyn & Son (York) Ltd (1975) 237 EG 183

  Facts:

  The defendant gave the plaintiff an option to purchase building land, stating notice of acceptance should be returned by registered or recorded delivery post between certain dates.

  The plaintiff returned a notice by ordinary post but within the time limit.

  The defendant, refused the notice stating: You will recall that clause 2 of the option agreement provides for notice to be sent by a registered or recorded delivery post. Your letter was not so sent....

  Issue:

  Was the acceptance sufficient?

  Held:

  There was no enforceable contract. There was a precise requirement that the notice had to be sent by registered or recorded delivery post and this was not complied with.

  An equally effective method will not suffice if the offeror has made clear a particular method is required.

Third party

Sometimes a third party may purport to accept an offer.

Silence

The general rule is that silence and mere inactivity do not constitute acceptance.

Therefore, an offeror cannot say that unless the offeree communicates a rejection he will be deemed to have accepted it. The onus should be on the offeree to communicate if he wishes to accept, not if he wishes to reject the offer.

• Felthouse v Bindley [1862] EWHC CP J35

  Facts:

  The plaintiff wanted to purchase a horse from his nephew. The horse was due to be sold at auction by the defendant.

  The plaintiff, in repesponse to a letter from his nephew about the sale, replied: If I hear no more about him, I consider the horse mine at £30 and 15s.

  The nephew did not reply but told the defendant not sell the horse. Accidently the defendant sold the horse.

  In order to sue the defendant, under tort law, the plaintiff was required to show that the horse was his property.

  The defendant argued there was no contract between the plaintiff and his nephew as there was no acceptance communicated.

  Issue:

  Was the nephew's silence capable of being acceptance of the plaintiff's offer?

  Held:

  There was no binding contract. The plaintiff could not impose the offer upon his nephew and require him to reject it. It was clear that the nephew intended to sell to the plaintiff however, he had not communicated this intention or done anything to bind himself.

  The decision in has been criticised because the nephew was not an unwilling offeree, needing to be protected by the rule that mere silence is not consent. Furthermore, he had indicated that he accepted the plaintiff's offer by telling the defendant not to sell the horse. However, the case has not been overruled.

• Re Selectmove [1995] 1 WLR 474

  Facts:

  A case involving a dispute over tax.

  Issue:

  The question of whether silence could constitute acceptance featured but was not essential to the decision in the case.

  Held:

  Gibson LJ obiter: Where the offeree himself indicates that an offer is to be taken as accepted if he does not indicate to the contrary by an ascertainable time, he is undertaking to speak if he does not want an agreement to be concluded. I see no reason in principle why that should not be an exceptional circumstance such that the offer can be accepted by silence....

Exceptions

An offer of a unilateral contract to the public at large can be worded to waive the need to communicate acceptance prior to a claim.

The postal rule creates another exception to the rule, by stating that acceptance is complete on posting.