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19 lessons,
2h 26m
Communication of Offer and Acceptance
27 plays

Explanation of Communication of offer and acceptance

Priyal Agrawal
CS Student, AIR 21 in CS foundation,love Teaching, reading, travelling, novels, fashion freak, watch the lessons to knw more

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  1. Indian contract act, 1872

  2. ABOUT ME - Myself Priyal Agrawal "CS executive & Bcom 2nd year student "Cleared CS foundation (AIR 22) "Interested in exploring new things and reading novels "Follow me on Uacademy:

  3. COMMUNICATION OF OFFER AND ACCEPTANCE One important common requirement for both 'offer and 'acceptance' is their effective communication. Effective and proper communication prevents avoidable revocation and misunderstanding between parties. When the contracting parties are face-to-face, there is no problem of communication because there is instantaneous communication of offer and acceptance. In such a case the question of revocation does not arise since the offer and its acceptance are made instantly. The difficulty arises when the contracting parties are at a distance from one another and they utilise the services of the post office or telephone or email (internet).

  4. "the communication of offer is complete when it comes to the knowledge of the person to whom it is made". This can be explained by an example. Where 'A' makes a proposal to 'B' by post to sell his house for 5 lakhs and if the letter containing the offer is posted on 10th March and if that letter reaches 'B' on 12th March the offer is said to have been communicated on 12th March when B received the letter. Thus it can be summed up that when a proposal is made by post, its communication will be complete when the letter containing the proposal reaches the person to whom it is made. . Mere receiving of the letter is not sufficient, he must receive or read the message contained in the letter. He receives the letter on 12th March, but he reads it on 15th of March. In this case offer is communicated on 15th of March, and not 12th of March. 4

  5. two modes of communication namely, (a) by any act and (b) by omission, intending thereby, to communicate to the other or which has the effect of communicating it to the other. Communication by act would include any expression of words whether written or oral. Written words will include letters, telegrams, faxes, emails and even advertisements. Oral words will include telephone messages. Again communication would include any conduct intended to communicate like positive acts or signs so that the other person understands what the person 'acting or 'making signs' means to say or convey Communication of acceptance by 'omission' to do something Such omission is conveyed by a conduct or by forbearance on the part of one person to convey his willingness or assent. However silence would not be treated as communication by omission Communication of acceptance by conduct. For instance, delivery of goods at a price by a seller to a willing buyer will be understood as a communication by conduct to convey acceptance

  6. Let us now come to the issue of when communication of acceptance is complete. In terms of Section 4 of the Act, it is complete, (i) As against the proposer, when it is put in the course of transmission to him so as to be out of the power of the acceptor to withdraw the same; (ii) As against the acceptor, when it comes to the knowledge of the proposer Where a proposal is accepted by a letter sent by the post, the communication of acceptance will be complete as against the proposer when the letter of acceptance is posted and as against the acceptor when the letter reaches the proposer. For instance in the above example, if 'B' accepts, A's proposal and sends his acceptance by post on 14th, the communication of acceptance as against 'A' is complete on 14th, when the letter is posted. As against 'B' acceptance will be complete, when the letter reaches 'A'. Here A' the proposer will be bound by B's acceptance, even if the letter of acceptance is delayed in post or lost in transit. The golden rule is proposer becomes bound by the contract, the moment acceptor has posted the letter of acceptance. Acceptance over telephone or telex or fax: When an offer is made of instantaneous communication like telex, telephone, fax or through e-mail, the contract is only complete when the acceptance is received by the offeree, and the contract is made at the place where the acceptance is received

  7. REVOCATION OF OFFER AND ACCEPTANCE Revocation means to retract, to cancel or to withdraw. In some situations, even though the offeror has already made an offer to the offeree ,he may changes his mind and decides to withdraw the offer. If the offer is validly revoked, there will be no contract created. When Can Offer Be Revoked ? An offer remains open until it lapses or is withdrawn Section 5(provides that "A proposal may be revoked at any time before the communication of its acceptance is complete as against the proposer, but not afterwards therefore once an acceptance has been made, the offeror is no longer entitled to revoke his offer

  8. 1. An agreement enforceable by law is a 2. A void agreement is one which is the parties (c) Enforceable at the option of one party (d) Not (a) Promise (b) Contract (c) Obligation (d) Lawful promise (a) Valid but not enforceable (b) Enforceable at the option of both enforceable in a court of law. 3. An agreement which is enforceable by law at the option of one or more of the parties thereon but not at the option of the other or others is a (a) Valid Contract (b) Void contract (c) Voidable contract (d) Illegal contract 4. When the consent of a party is not free, the contract is (a) Void (b) Voidable (c) Valid (d) Illegal 5. In case of illegal agreements, the collateral agreements are: (a) Valid (b) Void (c) Voidable (d) None of these 6. An offer may lapse by: (a) Revocation (b) Counter Offer (c) Rejection of offer by offeree (d) All of these 8

  9. ANSWERS 1 (b) 2 (d) 3 (c) 4 (b) 5 (b) 6 (d) 7 (a)

  10. Thanks! any questions Ask in comments section below? 10