Part B The law of obligations 3: Formation of contract I 498.2 Prescribed mode of communication
The offeror may call for communication of acceptance by specified means. Communication of acceptance
by some other means equally expeditious generally constitutes a valid acceptance unless specified
otherwise. This would probably apply also to acceptance by fax machine or email. The offeror would have
to use very precise wording if a specified means of communication is to be treated as mandatory.Yates Building Co v R J Pulleyn & Sons (York) 1975
The facts: The offer called for acceptance by registered or recorded delivery letter. The offeree sent an
ordinary letter which arrived without delay.
Decision: The offeror had suffered no disadvantage and had not stipulated that acceptance must be made
in this way only. The acceptance was valid.8.3 No mode of communication prescribed
The offeree can use any method but must ensure that their acceptance is understood if they choose an
instantaneous method of communication.Entores v Miles Far Eastern Corporation 1955
The facts: The claimants sent an offer by telex to the defendants' agent in Amsterdam and the latter sent
an acceptance by telex. The claimants alleged breach of contract and wished to serve a writ.
Decision: The acceptance took effect (and the contract was made) when the telex message was printed out
on the claimants' terminal in London. A writ could therefore be issued.8.4 The postal rule
The offeror may expressly or by implication indicate that they expect acceptance by means of a letter sent
through the post.The postal rule states that, where the use of the post is within the contemplation of both the parties, the
acceptance is complete and effective as soon as a letter is posted, even though it may be delayed or even
lost altogether in the post.Adams v Lindsell 1818
The facts: The defendants made an offer by letter to the claimant on 2 September 1817 requiring an
answer 'in course of post'. It reached the claimants on 5 September; they immediately posted a letter of
acceptance, which reached the defendants on 9 September. The defendants could have expected a reply
by 7 September, and they assumed that the absence of a reply within the expected period indicated non-
acceptance and sold the goods to another buyer on 8 September.
Decision: The acceptance was made 'in course of post' (no time limit was imposed) and was effective
when posted on 5 September.The intention to use the post for communication of acceptance may be deduced from the circumstances.Household Fire and Carriage Accident Insurance Co v Grant 1879
The facts: The defendant handed a letter of application for shares to the claimant company's agent in
Swansea for posting to the company in London. The company posted an acceptance which never arrived.
The defendant was called upon to pay the amount outstanding on his shares.
Decision: The defendant had to pay. The contract had been formed when the acceptance was posted,
regardless of the fact that it was lost.Key term