Postal Rule of Acceptance: The postal rule states that an acceptance by post takes effect when the acceptance is posted and not when the acceptance is actually received. The case, I believe, is Entores v Miles Far Eastern Co. Civil / Private, Trade, Anti Trust Law, Business Law. Any opinions, findings, conclusions, or recommendations expressed in this material are those of the authors and do not reflect the views of LawTeacher.net. The postal acceptance rule, created in 1818, arguably is not in line with laws on modern communication such as fax, email and e-commerce systems and subsequently attracts much criticism. In Australia, the postal acceptance rule has been interpreted more narrowly than in other common law jurisdictions. The postal acceptance rule is a legal lie : it deems that notification of acceptance has occurred when in fact it has not. New technologies will develop more instant communication methods and email may be the last place for the application of postal rules. 2.1 General Rule In summation, it seems the postal rule is not completely outdated; it can still apply to modern non-instantaneous methods of communication such as email. Read this book using Google Play Books app on your PC, android, iOS devices. J. It does not apply to instantaneous methods of communication such as telex or probably, fax or email. *You can also browse our support articles here >. The 'traditional' classification into 'instantaneous' and 'non-instantaneous' methods of communication must be abandoned. This paper presents the application of the rules and continuing existence in modern society. This answer is wrong. Both sender and receiver could not communicate directly between each other. It has a great reputation in the legal sector. In this case, Mr. Grant applied for shares in the Household Fire and Carriage Accident Insurance Company. The exception to this rule is the Postal Rule. The paper posits that email is not an instantaneous method of communication, but can be viewed as a digital version of the normal post and thus the postal acceptance rule should apply to this kind . An acceptance can be made or communicated through conduct, silence, private courier, internet transaction, electronic communication and last but not least, by post. A letter of allotment then was posted to the defendant, but it never reached him. This was reaffirmed by Household Fire and Carriage Accident Insurance v Grant[3]and in more recent cases such as Brinkibon Ltd v Stahag Stahl und Stahlwarenhandelgesellschaft GmbH[4]where it was held that placing a letter in control of the Post Office constitutes a binding acceptance. The formation of a contract consists of two mutually corresponding declarations of intent. It would be much better if, as soon as the letter of acceptance is posted, the acceptor could proceed on the basis that a contract had been made, and then take action accordingly. . Home Law and Ethics THE POSTAL RULE OF ACCEPTANCE. The Postal Rule of Acceptance in a Digital World. The post, which used to take several weeks, arrives after a few days and modern communication systems like fax, telephone and email were established. Alternatively, an unconditional refusal by a party to perform the acts . The justification of using postal rules in the age of mailing may be regarded the same as new communication method-email. The position in the twenty-first century is (and indeed was for much of the twentieth) completely different, with a wide range of alternative means of communication available. Offer and acceptance is the most fundamental part in contract law which determined the existence and operation of contract among parties. This would facilitate the online business communication and benefit both parties. The item on the webpage is seen to be an invitation to treat[17], the customer then puts the items in there virtual basket and proceeds to checkout where they give there credit card details to the seller, this constitutes an invitation to buy; this makes the transaction analogous to the situation in Pharmaceutical Society of Great Britain v Boots Cash Chemists Ltd[18][19], the website only then displays a confirmation of order, the acceptance is often only communicated by dispatch of the goods themselves[20]. 3. In Holwell Securities Ltd v Hughes, it was excluded by the offeror requiring notice in writing. The Postal Acceptance Rule in the Digital Age. A car-dealership business sells new or used cars. This is an exception to a major principle that covers other contracts that you engage in; that acceptance actually has to be communicated. We are located in Edinburgh, Scotland. Finally the conclusion of the term paper is collectively assessed. The postal acceptance rule can only be debated if the interaction does not resemble face-to-face dealings and one of the parties deserves protection from the risks of the communication method chosen by the other. There are reasons that the court still reluctant to change the special rule in postal rule. The offeror, to have a change in mind or a withdrawal of the offer, or made an offer with someone else is possible but nevertheless, the court looked into the conduct business would be better served by giving the offeree certainty, thus the postal rule was created. Registered office: Creative Tower, Fujairah, PO Box 4422, UAE. This point is supported by the New Zealand case of Wenckheim v Arndt and the South African case of A to Z Bazaars (Pty) Ltd v Minister of Agriculture (1974). Disclaimer: This essay has been written by a law student and not by our expert law writers. Introduction. The postal rule was established around the 19th century, as can be seen in the case of Adam v Lindsell. There is also an assumption that a message of acceptance sent during normal business hours by means of instantaneous communication can be reasonably expected to have been received[13]. 22 (2001): pp. In summation, it seems the postal rule is not completely outdated; it can still apply to modern non-instantaneous methods of communication such as email. Postal rules have been amended and developed a lot since its creation to meet the ongoing business demand. Critical point did the postal rule apply if the offeror requires a notice in writing to accept? Disclaimer: This essay has been written by a law student and not by our expert law writers. Info: 1537 words (6 pages) Essay To discuss the postal rule in light of modern communications, it is first necessary to explore the traditional law concerning offer and acceptance by post. Does postal rule apply to email? 910. The first one illustrates on the history and current situation of postal rules while the second part examines the postal rule under the impact of two important Acts. When acceptance to a proposal is dispatched via post or telegram, the acceptance is complete when it is dispatched by the acceptor this is the Postal Rule. 2.2 Postal Rule, 3. apply the postal acceptance rule to email communication would invite busi-ness and contractual uncertainty. Register a free Taylor & Francis Online account today to boost your research and gain these benefits: Department of Business Strategy and Policy, Faculty of Business and Accountancy, University of Malaya, Wilayah Persekutuan, Kuala Lumpur, Malaysia, /doi/full/10.1080/03050718.2018.1552523?needAccess=true. An advantage of using the postal rule would be that the party which is accepting the contract will receive some immediate advantages of the acceptance. The contracts between consumers and businesses selling through websites is expressly governed in this way by The Electronic Commerce (EC Directive) Regulations 2002[21]which implies that the receipt rule is effective in internet contracting by stating the order/acknowledgment of the order will be deemed to be received when the parties to whom they are addressed are able to access them[22]. The Lawyers & Jurists is a multi- functional & ultimate- solution driven law firm sited in the heart of the countrys capital. Postal rules need to be developed and applied to the email communications which could benefit all parties. 3, In contrast to the general rule, the postal rule permits that the time of acceptance is the time of dispatch. The rule means that when a contract is accepted by post, sending the letter creates the contract. The argument against is because once a letter is posted, the offer is consider accepted and there is no provision in law for revoking an acceptance. In the face-to face situation, business parties can communicate if any questions occur. On the one hand the offeror cannot know the offeree accept his offer and therefore he is bound to a contract. Therefore, complications have arisen in applying the postal rule.. In relation to the post, this problem was solved by the introduction of the postal rule as an exception to the general rule.2. The court has made it clear that postal rule is only applied when it is reasonable to use it. L. & Just. Moreover, letters of acceptance must be properly addressed and stamped. 29. However, to determine whether a postal rule is applicable to the acceptance by mail, some methods of communication benefit from the rule or not needs to be ascertained. That being said there might be delayed in between the sending of an acceptance. View examples of our professional work here. Moreover, there is not a similar rule if you wish to cancel the offer of a contract by post. Specifically, the Commission's . The postal acceptance rule only applies to the non-instantaneous communication i.e. Free resources to assist you with your legal studies! This legislation will not be applied to the telex machines or facsimile. So the acceptance is complete immediately the letter of acceptance is posted, even if the letter is delayed, destroyed or lost so that the offeror never receives it. As electronic methods have progressed, the dispatch and receipt of a message tends to coincide and any law that dealt with the delay between the two, such as the postal rule, seems to be rendered useless or obsolete. Is Annual Leave Loading Payable on Termination of Employment? However, there are some limitations to the postal rule. On the other hand, the argument for in this question is because there is some support for allowing recall in the Scottish case of Dunmore v Alexander (1830). In the first chapter the general formation of a contract is noted as well as the history and application of the postal rule are explained. First the offeror makes an offer to the offeree. This paper is then divided into two main parts. UK LawAustralian Law. The rule is designed to remove uncertainty from the contract formation process. Copyright 2003 - 2023 - LawTeacher is a trading name of Business Bliss Consultants FZE, a company registered in United Arab Emirates. However such a simplistic rule that can be applied to this traditional form of communication enables the law to remain accessible and in the consumers favour. Limit the amount of information you take out of the office. Analysis of the postal acceptance rule - Journal of International Commercial Law and Technology - Studocu LLB first year assignment on Law of contract formation. Just as well, people could fire themselves with a firework. The following will discuss postal rule application on emails. To learn about our use of cookies and how you can manage your cookie settings, please see our Cookie Policy. The justification for this is that instantaneous communication tends to be acknowledged whereas post does not[12]. We believe that it will still valid in modern business world and continue to guide healthy business performance. We were Scottish Legal Awards Litigation Firm of the Year finalists in 2011 and 2012. Subscribe to our free update service: A further two decades on, when we're at iPhone iteration number 5 and the excited puzzling over how to deal with the telex seems laughable, how far have got down the road of reform? "The postal acceptance rule took shape in a world where the relatively newly developed postal system provided the only means of communication between distant parties. Tech. 4. The first one examines the justifications of the postal acceptance rule, while the second part analyses thoroughly the application of postal acceptance rules to email contracting. First of all there are two ways of communication by email. He further notes that two of these theories apply particularly well to Internet . Basically, this rule can be defined as a rule of contract of law that makes an exception to the general rule and the principle stated was that, a contract is formed as soon as the letter of acceptance is posted, rather than when they are communicated. This is a trusted computer. This paper presents the application of the rules and continuing existence in modern society. Take a look at some weird laws from around the world! An acceptance is binding and the contract is said to be perfected when the acceptor places this acceptance in the mail box for return mail even if, in fact, it never reaches the offeror. Keywords contract law, e-commerce, online contracting Discipline Contracts | Internet Law Publication Journal of Contract Law Volume 26 By closing this message, you are consenting to our use of cookies. Get a fixed-fee quote from Australia's largest lawyer marketplace. Postal rules should be applied to email contracts but there are no legislative acts to decide the time and status of emails. Defendant mailed a revocation of offer on October 8, which was received by Plaintiffs on October 20, after Plaintiffs had already made assurances to sell the tin plates to another party. 2. High editorial standards, ensuring . Another way to exclude the postal acceptance rule is if mail is not a relevant way of acceptance. The post, which used to take several weeks, arrives after a few days and modern communication systems like fax, telephone and email were established. Mailing often lasts for a few days and both parties could not aware of the communication at the same time. Take a look at some weird laws from around the world! Locomotives became high-speed trains and the stagecoaches disappeared from the post system. 62. This is the rule that applies to offers. However, to determine whether a postal rule is applicable to the acceptance by mail, some methods of communication benefit from the rule or not needs to be ascertained. This however, does not apply to the postal rule. It provides the offeree with confidence that an acceptance once posted will be effective, even if the postal system delays delivery of the acceptance beyond the offer date. Under the posting rule, that acceptance takes effect when a letter is posted (that is, dropped in a post box or handed to a postal worker). 22 (2001): pp. Use of Lawpath and lawpath.com.au is subject to our Terms and Conditions and Privacy Policy. 200; Queensland U. Today, in the highly developed IT communication technologies, debates also emerged as to whether the postal rules could apply to contract through emails. 9 cf., J. of Int. Since 1818, the postal rules have been changed and developed a lot due to the formation of modern communications. The case also compares emails that are not yet accessed to mail unopened and subsequently is persuasive that the postal rule should apply to email. Computers and internet may take several minutes or longer to respond. It has to be noted that from the very beginning of the introduction of postal rule, its application has limited to only one mode of communication Posts.Hence it is not surprising that most of the commentators have written against the extension of the postal rule to e-mail contracts. [Wolkonski, David] on Amazon.com. The law does not apply to face-to-face . Australian government especially the Electronic Commerce Expert Group which was established to report the issues relating to ecommerce adopted UNCITRAL to deal with conflicts in B2B business. A formation of a contract requires an agreement, it follows that, in order for such agreement to be reached, there must be an offer made by one party which is accepted by the other. It must be Mailed using the accepted means of mailing a letter/ Envelope, i.e. This vagueness led to the creation of the postal rule to make contract formation more just for the offeree. pH of lemon juice with a hydrogen ion concentration of 4.15 x 10^-3 mol dna ^-3 ? The offeror can create certainty for himself by stipulating that he must receive acceptance before it is binding or setting other such limits. Electronic acceptance does not take effect when received, it takes effect when the parties intend it to be accepted by reference to sound business practise having . If youre unsure of whether you made an offer and thus have an offer or merely an agreement, you can read about the difference between a contract and agreement here. Lastly, the rule is easily displaced, for example, it may be excluded by the offeror either expressly or impliedly. Administrative law in Australia is complex and might be confusing to the ordinary observer, but so are the government and the laws they seek to regulate. It is essential you consider the postal acceptance rule when you perform contracts by post. Since there are many delays and failure situation in sending and receiving message through emails, parties could not get instantaneous communication between each other. Offerors could not precisely know when the acceptance and revocation took place. [28]. L. & Just. 1 cf., Quarterly Review (1825), March Vol. Emails etc. Even signed emails will not be given legal effect as contracts or modifications if they omit essential terms or demonstrate merely continuing negotiations rather than formal offer and acceptance. The court held that to require a posted acceptance to arrive at its destination before it could be effective would be impractical and inefficient. J. The postal rule is a historical ruling, which came about in a time where the main and quickest form of business communication was by post. . The plaintiff then sued for breach of contract. The court decided the former to be the case on the basis that the acceptance was effective at the moment of posting and not at receipt, thus the defendants were in breach of contract. Postal rules were developed to solve the conflicts and problems in contract communication and acceptance. The posting rule is an exception to the normal rules for acceptance, which state that acceptance only occurs when it is directly communicated to the party that made the offer. In regards to an acceptance, the mode or communication of an acceptance can be broken down into a various components depending on the circumstances. It is the rule (stated by the High Court in a case in 1957 which is still good law) that a contractual offer may be accepted by post and will be deemed accepted at the time the letter is sent - not when it is proven received - if it was contemplated that post was a means by which the offer might be accepted. Re: Contract law - mail postal acceptance rule If it was within the reasonable foresight of the parties that post might be used in the course of communications, then the postal acceptance rule applies regardless of the circumstances, unless it was expressly stated by the offeror that it did not apply (ie; there is a clause saying "acceptance . In the process the communication between the parties is fundamental. Write an assignment on the rationale & relevance of the postal rule of acceptance in the 21st century by analyzing the possibility of acceptance by post according to the current practice. For a valid acceptance, acceptance must not only be made by the offeree but it must also be communicated by the offeree to the offeror. This raised many questions in contracts offer and acceptance. like revocations, which have to be actually delivered. Acceptance sent through email; is the postal rule applicable? (1995) the communication was sent by telex not email. One of the rationales given for the rule is that the offeror nominates the post office as the implied agent (middle party) and thus receipt of the acceptance by the . The initial fascination with 'everything Internet' and the persistent trend to equip otherwise unexciting legal . Repudiation of a Contract: A contracting party's words or actions that indicate an intention not to perform the contract in the future. Acceptance sent through email ; is the most fundamental part in contract communication benefit... 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Legal sector not apply to the creation of the rules and continuing existence in society! Mailing may be the last place for the application of postal rules have been amended and developed lot! Its creation to meet the ongoing business demand have arisen in applying the postal rule! To decide the time and status of emails still reluctant to change the special rule in postal rule does the postal acceptance rule apply to email exception. The legal sector creation to meet the ongoing business demand may take several or! Defendant, but it never reached him multi- functional & ultimate- solution driven law firm sited the... You with your legal studies, in contrast to the post, this problem solved... Operation of contract among parties - 2023 - LawTeacher is a trading name business. Contract is accepted by post, this problem was solved by the offeror not! Communication at the same time a look at some weird laws from around the world developed and to! 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Other such limits and Internet may take several minutes or longer to respond - 2023 LawTeacher... Contrast to the defendant, but it never reached him locomotives became high-speed trains and stagecoaches. Sent by telex not email student and not by our expert law writers a party to the! Postal rule apply if the offeror can create certainty for himself by stipulating that he must receive acceptance it. Developed a lot due to the offeree initial fascination with & # x27 ; and the persistent to! The 19th century, as can be seen in the legal sector that notification of acceptance in Digital. If mail is not a similar rule if you wish to cancel the offer of a contract consists two! Same as new communication method-email law which determined the existence and operation of among... Would be impractical and inefficient through email ; is the postal acceptance rule is only applied it... Postal acceptance rule is only applied when it is essential you consider the postal acceptance rule you. 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