Page 25 - DMGT102_MERCANTILE_LAWS_I

Unit 2: Offer and Acceptance

Notes
Example:
(i) A shopkeeper received an order from a customer – a household lady. He executed the
order by sending the goods. The customer’s order for goods constitutes the offer which
was accepted by the shopkeeper by sending the goods. It is a case of acceptance by conduct.
Here the shopkeeper is accepting the offer by the performance of the act (i.e., sending the
goods).
(ii) A loses his dog and announces a reward of ` 500 to anyone who brings his dog to him. B
need not convey his acceptance of the offer, which is a general one. If he finds the dog and

gives it to A, he is entitled to the reward as he accepted the offer by doing the required
act.
Implied acceptance. Acceptance is implied when it is said to be gathered from the surrounding
circumstances or the conduct of the parties.

Example:
(i) A enters into a bus for going to his destination and takes a seat. From the very nature of the
circumstance the law will imply acceptance on the part of A.

(ii) A’s scooter goes out of order and he is stranded on a lonely road. B, mechanic who
observes this starts correcting the fault. A allows B to do the same. From the nature of the
circumstances A has given his acceptance to the offer of B.
Who can accept an offer. We have mentioned earlier that a specific offer can be accepted only by

the person to whom it is made. The rule of law is that if A wants to enter into a contract with B
then C cannot substitute himself for B without A’s consent. However in the case of a general offer
it can be accepted by anyone by complying with the terms of the offer.

Example:
(i) A purchased B’s business. Prior to the purchase, A was working as the manager of B. C,
to whom B owed a debt, placed an order with the latter for the supply of certain goods. A
supplied the goods even though the order was not addressed to him. C refused to pay A for
the goods because he, by entering into contract with B, intended to set-off his debt against
B. Held, the offer could be accepted by B only and not by anyone else. [Boulton v. Jones 157
ER 232].

(ii) The case of Carlill v. Carbolic Smoke Ball Co. (Supra) illustrates that a general offer can be
accepted by anyone by complying with the requirements of the offer.
Essentials of a valid acceptance. The following are the essentials of a valid acceptance:

(i) It must be absolute and unqualified and according to the exact terms of the offer (s.7),
(ii) It must be communicated to the offeror,
(iii) It must be according to the mode, if any, prescribed by the offeror (s.7),
(iv) It must be given within the time specified, if any, otherwise it must be given within a

reasonable time,
(v) It must be made before the offer lapses or is terminated, revoked or withdrawn. If the offer
has already lapsed then there is nothing to accept,
(vi) It must be given by the person to whom the offer is made. However, in the case of a general
offer, acceptance can be given by any member of the public.

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