BetterLawNotes-5 (2)

CONTRACT LAW

In principle, an offeror can withdraw or revoke his offer at any time until acceptance is effective.

Routledge v Grant (1828) 3 Car & P 267; 4 Bing 653

G wrote to R on 18th March with a proposal for G to take a tenancy of a particular house owned by R, possession to be given on 25th July. The letter stated that a definitive answer was to be given within six weeks. On 6th April, R replied accepting G’s offer and saying that possession would be given on 1st August. The following day, having received R’s acceptance, G wrote again to R withdrawing his proposal. On 29th April, and before the expiry of the original six-week period, R wrote to G saying that possession would be given on 25th July. Lord Best CJ held that R’s letter of 6th April was not an effective acceptance and that G’s offer had been revoked before R’s letter of 29th April was sent.

Communicating the Revocation

To be effective in withdrawing the offer, the withdrawal must itself be communicated. The postal rule does not apply to withdrawals.

Byrne & Co v Van Tienhoven (1880) 5 CPD 44

S, who carried on business in Cardiff, wrote to B, who carried on business in New York, on 1st October offering to sell 1,000 boxes of tinplates on certain terms. B received the letter on 11th October and replied by telegram the same day accepting the offer. B confirmed their acceptance by letter posted on 15th October. In the meantime, on 8th October S had posted a letter to B revoking the offer. This withdrawal letter arrived on the 20th October. Lindley J. held that a contract came into existence.

While the fact of revocation must be communicated to the offeree, it seems that communication need not be via the offeror himself.

Dickinson v Dodds (1876) 2 Ch D 463

On Wednesday 10th June Dodds offered to sell certain property to Dickinson, the offer to be left open until Friday 12th June at 9 am. On the Thursday afternoon Dickinson was told by his agent, Berry, that Dodds had agreed to sell the property to Allan. On the Friday morning at 7 am, Dickinson handed a written acceptance to Dodds only to be told that he was too late. The Court of Appeal held that Dodds’ offer had, to the knowledge of Dickinson, been withdrawn and was not therefore capable of acceptance.

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