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Unit 2: Offer and Acceptance

Effect of silence of the offeree or his failure to reply. The acceptance of an offer cannot be implied Notes
from the silence of the offeree or his failure to reply.

Example: A offered by a letter to buy his nephew’s T.V. set for ` 3,000, saying, “If I hear no
more from you, I shall consider the T.V. set is mine at ` 3,000”. The nephew did not reply at all,
but he told an auctioneer who was selling his T.V. set, not to sell that particular T.V. set as he had
sold it to his uncle. By mistake, the auctioneer sold the set. A sued the auctioneer for conversion.
Held, A could not succeed as his nephew had not communicated acceptance and therefore there
was no contract. However, if the offeree has by his previous conduct indicated that his silence
means that he accepts then the acceptance of the offer can be implied from the silence of the
offeree. Further, in the case of a general offer it is not necessary to communicate the acceptance if
it is made by acting upon the terms of the offer [Carlill v. Carbolic Smoke Ball Co., Supra].
Acceptance must be according to the mode prescribed [s.7]. Where the offeror prescribes a
particular mode of acceptance then the acceptor should follow that mode. In case no mode of
acceptance is prescribed by the offeror, then the acceptance must be according to some usual
and reasonable mode. If the offeror prescribes a manner in which the offer is to be accepted and
the acceptance is not made in such manner, the offeror may, within a reasonable time, after the
acceptance is communicated to him, insist that his offer shall be accepted in the prescribed mode
and not otherwise, but if he fails to do so he is deemed to have agreed to the acceptance.

Example: A sends an offer to B through post in the usual course. B should make the
acceptance in the “usual and reasonable manner” as no mode of acceptance is prescribed. He
may accept the offer by sending a letter through post in the ordinary course within a reasonable
time. However, if A had asked for an acceptance by telegram then B should accept the offer by
telegram. In case B accepts the offer by a letter then A may insist that the acceptance should be
in the prescribed mode. But if A (the offeror) does not insist within a reasonable time that the
acceptance be in the prescribed mode, then he is bound by the acceptance though not made in the
prescribed mode.
An agreement to agree in the future (futuristic agreements). Law does not allow making of an
agreement to agree in the future. The parties must agree on terms of the agreement. The terms

of the agreement must be either definite or capable of being made definite without further

agreement of the parties.
2.7 Completion of Communication of Offer and Acceptance [S. 4]

It is necessary to communicate offer to the offeree and the acceptance to the offeror. When is
it that the communication is considered to be completed? The communication of an offer is
complete when it comes to the knowledge of the person to whom it is made. Where A proposes
by a letter to sell his car to B at a certain price, the communication of the offer is complete when
B receives the letter. The completion of communication of acceptance has two aspects, viz; (i) As
against the offeror and (ii) As against the acceptor. The communication of acceptance is complete
(i) As against the offeror when it is put into a course of transmission to him so as to be out of
the power of the acceptor; (ii) As against the acceptor, when it comes to the knowledge of the
offeror. Thus, in the above example, if B accepts A’s offer by sending a letter through post, then
the communication of acceptance is complete (i) As against A when the letter is posted by B; and
(ii) As against B when the letter is received by A.
Revocation of offer and acceptance [s.5]. It is possible for the offeror to revoke the offer before
it is accepted by the offeree but not later. Similarly, the offeree may revoke acceptance, till the
communication of acceptance is complete as against him but not later. Thus, in the above example
A may revoke his offer at any time before or at the moment, when B posts his letter of acceptance,
but not afterwards. B may revoke his acceptance at any time before or at the moment when

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