When the contracting parties are face to face with each other, there is immediate communication of offer and acceptance. The moment the offeree gives his acceptance there is a valid agreement. When the parties are at a distance from each other, the services of post office are utilized to enter into a contract. In this case the following rules apply,
Communicatio of offer:
section 4 explains, "the communition of a proposal is complete when it comes to the knowledge of the persone to whom it is made".
it means that communication of an ofer completes whin the letter containing an offer comes to the knowledge of the offeree.
Examples:
a- M offers by letter, to sell a van to N for Rs 10 lac. the letter reaches N on 10th march. communication of the offer is complete on 10th march.
b- Y sends a letter to Z offering to sell his motorcyle for Rs 45,000. the letter never reaches Z. the offer is not complete.
2- communication of acceptance:
the communication of an acceptance is complete;
a- As against the proposer, when it is put in course of transmintion to him, so as to be out of power of the acceptor.
b-As againstthe acceptor, when it comes to the knowledge of the proposer.(Sec.4).
it means that the communication of an acceptance completes, as against the offeror, when the letter of acceptance is posted to the offeror, i.e. when letter of acceptance is out of control of the acceptor. the communication of an acceptance completes, as against the acceptor, when the letter of acceptance comes to the knowledge of afferor.
Examples:
a- M offers, be letter, to sell a van to N for Rs 500,000. the letter reaches N on 8th march. N accepts by a letter sent by post on 9th march. the letter reahesM on 11th march. the communation of the acceptance is comlete.
As against M, when the letter is posted, i.e. on 9th march, and
As against N, when the letter is received by M, i.e. on 11 march.
b- K offered by post to purchase share of the company. the letter of allotment posted by the company never reached K. Held, the acceptance was complete as soon as the letter of acceptance was posted. (H.F.Insurance Co. vs. Grant).
3- communication of revocation:
revocation means cancellation. there may be a revocation of offer and acceptance. the communication of a revocation is complete;
a- as against the person who makes it, when it is put in course of transmition to the person to whom t is made, so as to be out of the power of person who makes it.
b- as against the person to whom it is made, when it comes to his knowledge. (Sec. 4).
it means that communication of revocation completes, as against the person, who makes it, when the letter of revocation is posted. the communication of revocation completes, as against the person, to whom it is made, when the letter of revocation comes to his knowledge.
examples:
a- M revokes his offer by letter on 10th may. the letter reaches N on 15th may. the revocation is complete as against M on 10th may, when the letter of revocation is posted. is is complete as against N on 15th, when the letter of revocation reaches him.
b- T offered by a letter on October 1st to sell goods to B in Islamabad. B received the offer on 11th and gave his acceptance on !8th. T wrote a letter revoking his offer. The letter was received by B on 20th. Held, the revocation was of no effect untill it reached B. A contract made on 11th when B accepted the offer. (Byrne vs. Van Timehoven).
Time of Revocation of Offer and Acceptance:
An offer may be revoked at any time before communication of its acceptance is complete as against the offeror, but not afterwards. An acceptance may be revoked at any time before communication of the acceptance is complete as against the acceptor, but not afterwards. (Sec.5).
Example:
A offers by a letter to sell his house to B. B accepts the offer by a letter posted on the 4th. The letter reached A on 6th. A may revoke his offer before B posts his letter of acceptance, i.e. 4th but not afterwards. B may revoke his acceptance before the letter of acceptance reaches A, i.e. 6th but not afterwards.
Communicatio of offer:
section 4 explains, "the communition of a proposal is complete when it comes to the knowledge of the persone to whom it is made".
it means that communication of an ofer completes whin the letter containing an offer comes to the knowledge of the offeree.
Examples:
a- M offers by letter, to sell a van to N for Rs 10 lac. the letter reaches N on 10th march. communication of the offer is complete on 10th march.
b- Y sends a letter to Z offering to sell his motorcyle for Rs 45,000. the letter never reaches Z. the offer is not complete.
2- communication of acceptance:
the communication of an acceptance is complete;
a- As against the proposer, when it is put in course of transmintion to him, so as to be out of power of the acceptor.
b-As againstthe acceptor, when it comes to the knowledge of the proposer.(Sec.4).
it means that the communication of an acceptance completes, as against the offeror, when the letter of acceptance is posted to the offeror, i.e. when letter of acceptance is out of control of the acceptor. the communication of an acceptance completes, as against the acceptor, when the letter of acceptance comes to the knowledge of afferor.
Examples:
a- M offers, be letter, to sell a van to N for Rs 500,000. the letter reaches N on 8th march. N accepts by a letter sent by post on 9th march. the letter reahesM on 11th march. the communation of the acceptance is comlete.
As against M, when the letter is posted, i.e. on 9th march, and
As against N, when the letter is received by M, i.e. on 11 march.
b- K offered by post to purchase share of the company. the letter of allotment posted by the company never reached K. Held, the acceptance was complete as soon as the letter of acceptance was posted. (H.F.Insurance Co. vs. Grant).
3- communication of revocation:
revocation means cancellation. there may be a revocation of offer and acceptance. the communication of a revocation is complete;
a- as against the person who makes it, when it is put in course of transmition to the person to whom t is made, so as to be out of the power of person who makes it.
b- as against the person to whom it is made, when it comes to his knowledge. (Sec. 4).
it means that communication of revocation completes, as against the person, who makes it, when the letter of revocation is posted. the communication of revocation completes, as against the person, to whom it is made, when the letter of revocation comes to his knowledge.
examples:
a- M revokes his offer by letter on 10th may. the letter reaches N on 15th may. the revocation is complete as against M on 10th may, when the letter of revocation is posted. is is complete as against N on 15th, when the letter of revocation reaches him.
b- T offered by a letter on October 1st to sell goods to B in Islamabad. B received the offer on 11th and gave his acceptance on !8th. T wrote a letter revoking his offer. The letter was received by B on 20th. Held, the revocation was of no effect untill it reached B. A contract made on 11th when B accepted the offer. (Byrne vs. Van Timehoven).
Time of Revocation of Offer and Acceptance:
An offer may be revoked at any time before communication of its acceptance is complete as against the offeror, but not afterwards. An acceptance may be revoked at any time before communication of the acceptance is complete as against the acceptor, but not afterwards. (Sec.5).
Example:
A offers by a letter to sell his house to B. B accepts the offer by a letter posted on the 4th. The letter reached A on 6th. A may revoke his offer before B posts his letter of acceptance, i.e. 4th but not afterwards. B may revoke his acceptance before the letter of acceptance reaches A, i.e. 6th but not afterwards.
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