Acceptance and Revocation of Offer

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ACCEPTANCE:

Section 7 of Indian Contract Act:

In order to convert a proposal into a promise the acceptance must –

(1) be absolute and unqualified.

(2) be expressed in some usual and reasonable manner, unless the proposal prescribes the manner in which it is to be accepted. If the proposal prescribes a manner in which it is to be accepted; and the acceptance is not made in such manner, the proposer may, within a reasonable time after the acceptance is communicated to him, insist that his proposal shall be accepted in the prescribed manner, and not otherwise; but; if he fails to do so, he accepts the acceptance.

 

REVOCATION OF PROPOSALS AND ACCEPTANCE:

Section 5 of Indian Contract Act:

A proposal may be revoked at any time before the communication of its acceptance is complete as against the proposer, but not afterwards.

An acceptance may be revoked at any time before the communication of the acceptance is complete as against the acceptor, but no afterwards.

  • Payne v. Cave   (1789) 3 TR 148   [Summary]
  • Byrne v. Van Tienhoven    [1880] 5 CPD 344   [Summary]
  • Dickinson v. Dodds   (1876) 2 Ch D 463   [Summary]   [Full Text]
  • Martin Walford v. Charles Miles    [1992] ADR.L.R. 01/23   [Summary]

Countess of Dunmore v. Alexander   (1830) 9 Sh 19

Revocation was allowed in this case involving simultaneous arrival of the two messages. The case is often cited in support of the proposition that the acceptance may nevertheless be revoked by a letter reaching the offer or before the letter of acceptance.(Aubrey, 1965: 1018).

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