Postal rule CASES
In English law, the postal rule is an exception to the general requirement for acceptance of contracts to be communicated, stating that acceptance is effective upon posting, rather than when received by the offeror.
Definition and Principles
The postal rule applies when acceptance by mail is considered appropriate. Once acceptance is correctly posted, a binding contract is immediately formed, regardless of delays or failure in delivery.
Key Conditions
- Proper Posting: Acceptance must be correctly addressed, stamped, and posted.
- Reasonable Method: Postal acceptance must be an agreed or reasonable mode of communication.
- Exclusion: Parties may explicitly exclude the postal rule in their contract.
Practical Implications
The rule provides certainty and protection for offerees, enabling reliance upon acceptance once dispatched. Offerors must clearly specify acceptance methods if postal rule application is undesired.
Limitations
The postal rule does not apply to instantaneous forms of communication such as email, fax, or telephone.
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Holwell Securities attempted to exercise an option to purchase property by posting a letter which never reached the defendant. The Court of Appeal held that the postal rule did not apply because the option required 'notice in writing to' the vendor, meaning actual communication was necessary. The appeal was dismissed....
Entores made an offer via Telex from London, which was accepted by Telex from Amsterdam. The Court of Appeal held that for instantaneous communications like Telex or telephone, a contract is complete when acceptance is received by the offeror, not when sent. The contract was therefore made in London where...
Facts The defendants, wool-dealers in St. Ives, sent a letter to the plaintiffs, who were woollen manufacturers in Bromsgrove, on 2 September 1817, offering to sell them a quantity of wool. The defendants required an answer ‘in course of post’. Critically, the defendants misdirected this letter to ‘Bromsgrove, Leicestershire’, instead...