Acceptance

Acceptance

Once an offer has been made the next step is for that offer to be accepted. The acceptance must be positive and unqualified; once an offer has been accepted there is a contract between the two parties. The acceptance must be communicated to the other party. This can happen in a number of ways. 

Methods of communication of acceptance:

Verbal Acceptance

This is easily established as long as the acceptance is clear and heard.

Acceptance by Conduct

Silence cannot be acceptance; some form of action is necessary.

Felthouse v Bindley (1862)

The sale of a horse was being negotiated by a letter; the final letter stated if Felthouse heard nothing he would presume that the offer had been accepted. The court held that this was not enough to constitute acceptance, a positive act is required.

Acceptance by post: The Postal Rule 

1. The postal rule only applies to letters of acceptance and not offers.
2. The postal rule only applies if the post is the usual method of communication between the parties.
3. Acceptance takes place when a correctly stamped letter is posted not when it is received. 
4. The claimant must be able to prove the acceptance was posted.

Adam v Lindsell (1818): This case clarified the postal rule and explained that acceptance takes effect at the moment of posting.

Electronic and instant forms of communication: the postal rule had to develop to keep up the development of technology for communication methods such as email and phone calls.

Entores v Miles Far East Corporation (1955): the court held acceptance by telex machine was made when the telex was received.