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Unit 2: Offer and Acceptance

12. On the 5th of a month A makes an offer to B, by a letter which reaches B on the 6th. On the Notes
7th B posts his letter of acceptance. Meanwhile, on the 6th A posts a letter to B revoking
the offer. On seeing it B sends a telegram to A on the 8th confirming the acceptance given

through his letter of the 7th. Discuss the legal effects of the three letters and the telegram.
[Hint: The contract is concluded between A and B on 7th when B posts the letter of
acceptance. It is assumed that the letter of A revoking offer reaches B after B has posted the
letter of acceptance. The telegram only confirms acceptance already given (Secs. 4 and 5).]

13. A offers, by a letter, to sell a certain article to B who receives the letter the next day.
B immediately posts his letter of acceptance. The same evening A posts a letter revoking
the offer. A’s letter of revocation and B’s letter of acceptance cross ing the post. Is there a
contract between A and B?

[Hint: Yes (Secs. 4 and 5)]
Answers: Self Assessment

1. implied 2. prospective shareholder 3. Acceptance
4. decline 5. claim 6. payment of money
7. non-gratuitous

2.12 Further Readings

Books G. Vijayaragavan Iyengar (2007), Introduction to Banking, Excel Books, New Delhi,
India.

S .S Gulshan, Business Law, Third Edition, 2006, Excel Books, New Delhi.
S.S Gulshan, Mercantile Law, Third Edition, 2006, Excel Books, New Delhi.

Online links http://business.gov.in/manage_business/contract_law.php
http://lawcommissionofi ndia.nic.in/1-50/Report13.pdf

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