Acceptance

An acceptance is the 2nd step toward the valid contract, when an offer is
made by a person to another person then it is unto that another person
either to accept that absolutely or to deny but the possibilities of a valid
contract will only be if such another person accept the proposal made to
him without the acceptance. There shall be no contract. It is noticeable
point that for a thing to be an acceptance the condition required for valid
acceptance must be satisfied.

Meaning and Definition of acceptance

The word acceptance is defines in section 2B of Indian contract act,
According to this section when the person to whom the proposal is made
signifies his assent there to proposer is said to be accepted. By this
definition it appears that if a person whom the proposal was made is agreed
with the willingness of the person by whom the proposal was made and
such agreed is communicating by him to that person it is known as
acceptance.

Effect of Acceptance
Section 2B itself provide about the effect of acceptance, According to this
section when a proposal is accepted it becomes a promise. It means the
promise is a proposal which has been accepted by another party then the
role of acceptance is that it converts the proposal into promise.

Test of acceptance
For the acceptance, the essential requirement is that the parties had each
from a subjective perspective engaged in conduct manifesting their assent.
Under this meeting of the minds theory of contract, a party could resist a
claim of breach by proving that he had not intended to be bound by the
agreement, only if it appeared subjectively that he had so intended. This is
unsatisfactory, as one party has no way to know another's undisclosed
intentions. One party can only act upon what the other party reveals

objectively (Lucy V Zehmer,196 Va 493 84 S.E. 2d 516) to be his

intent. Hence, an actual meeting of the minds is not required. Indeed, it has
been argued that the "meeting of the minds" idea is entirely a modern
error: 19th century judges spoke of "consensus ad idem" which modern
teachers have wrongly translated as meeting of minds but actually mean
"agreement to the [same] thing"
The requirement of an objective perspective is important in cases where a
party claims that an offer was not accepted and seeks to take advantage of
the performance of the other party. Here, we can apply the test of whether a
reasonable bystander (a "fly on the wall") would have perceived that the
party has impliedly accepted the offer by conduct.
Condition for the valid Acceptance
For valid acceptance, certain conditions must be fulfilled. These are:
1. Acceptance must be absolute and unqualified:
Section 7(1) of the Indian Contract Act provides that 'In order to convert a
proposal into a promise, the acceptance must be absolute and
unqualified.....' A qualified and conditional acceptance amounts to a
counter offer which amounts to non acceptance. Moreover, an offer must be
accepted in full. If only a part of the offer is accepted, the acceptance will
not be valid. For example, X offers to sell 400 quintals of sugar to Y at a
certain price.
Y accepts to buy 280 quintals only. It is not a valid acceptance since it is not
the whole of the offer. In McPherson Vs. Alana, AIR 1951 SC 184, the
plaintiff offered Rs. 6,000 for the purchase of defendant's house and adding
that he could pay more if found reasonable, to which defendant replied,
"Won't accept less than Rs. 10,000" that was accepted by the plaintiff as
counter offer. Court held that no contract is concluded between the party as
second reply was a tender for the offer and not acceptance.
2. Acceptance must be in prescribed manner: Acceptance has to be
made in the manner prescribed or indicated by the offered. If the offer is

not accepted in the prescribed manner it is up to the offered to accept or

reject such acceptance. But when the acceptance is not in the prescribed
manner and the offered wants to reject it, he must inform the acceptor
within a reasonable time that he is not bound by acceptance since it is not
in the prescribed manner. If he does not do so within a reasonable time, he
will be bound by the acceptance. Where no manner is prescribed. When no
mode of acceptance is prescribed, acceptance must "be expressed in some
usual and reasonable manner."
3. Acceptance must be communicated:
The acceptance is valid only when it has been communicated to the offered.
A mere silence or mere mental acceptance not evidenced by words or
conduct is no acceptance. However, the offered, while making an offer,
cannot impose a burden on the other party to communicate his refusal or
rejection.
He can only prescribe the manner in which the offer is to be accepted. In
case Felt house Vs. Bindley (1863), 7 L.T. 835, F offered by a letter to
buy his nephew's horse for 30 saying if I hear no more about him, I shall
consider the horse is mine . The nephew sent no reply at all but told
Bindley, his auctioneer, not to sell that particular horse as he intends to sell
it to his uncle. Bindley, however, sold the horse by mistake. F sued
auctioneer.
It was held that F would not succeed as his nephew had not communicated
acceptance and hence there was no contract. In Delhi Development
Authority vs. Ravinder Mohan Aggarwal, 1999(3), SCC 172, it has
been held that mere noting on the file of acceptance of the bid is not
enough, it should be duly communicated. The knowledge of the bidder of
such noting is inconsequential and cannot give rise to contract.
4. Only authorised person should communicate about the
acceptance: In order to make an acceptance valid, it should be communicated
by the offeree himself or by a person who has the authority to accept. In case,
Powell vs. Lee (1908), 99 L.T. 284. P applied for the post of a headmaster in a
school.

The Managing Committee passed a resolution appointing P to the post but

this decision was not communicated to P. However, a member of the
Managing Committee, in his individual capacity and without any authority,
informed P about the decision. Subsequently, the managing committee
cancelled its resolution and appointed someone else. P filed a suit for
breach of contract. It was held that he was not informed about his
appointment by some authorized person; hence there was no
communication of acceptance.
5. Acceptance should be made within the time prescribed or
within a reasonable time: The acceptance should be given within the
prescribed time or within a reasonable time. What is a reasonable time
depends upon the facts of the case.
6. Acceptance before the lapse of proposal: An acceptance can be
valid and effective which is made before the lapse of the proposal. It means
the acceptance must have been made when the proposal was in existence.
For this purpose it s necessary to know in what condition a proposal is
lapsed. Section 6 of the contract act provides about the case in which a
proposal is lapse and some other cases is developed by the judicial
Interpretation.
Section 6 revocations how made:
A)by the communication of notice of revocation by the proposer to the
other party: Section 6 clause 1 empower the proposal that he may
revoke his proposal by giving notice revocation to the acceptor. But it
is required that such notice must have been given before the
acceptance of the proposal. Thus the notice of revocation should not
be effective if the proposal has already been accepted.
B) by the lapse of the time prescribed in such proposal for its
acceptance, or, if no time is so prescribed, by the lapse of a reasonable
time, without communication of the acceptance: A proposal is lapse at
the expiry of time which was given to the acceptor to its acceptance.
Thus if in the proposal the time for its acceptance is specified the
proposal is required to be accepted within such time and when such

time expires the proposal is lapsed. But for acceptance is not specified
the proposal is required to be accepted within reasonable time. On
the expiry og such reasonable time the proposal is lapsed. The
reasonable time is decided on the basis of fact and circumstances of
the case especially on the basis of nature of the subject matter or
importance the subject matter or need of subject matter.
C) by the failure of the acceptor to fulfill a condition precedent to
acceptance: When the proposal is made with the condition precedent
it is required that the acceptor should accept the proposal with
condition precedent . But if the acceptor fails in performing such
condition precedent or attempts to accept the proposal without
accepting such conditions the proposal shall be lapsed and the
acceptor is not entitle to accept it after this.
D)by the death or insanity of the proposer, if the fact of his death or
insanity comes to the knowledge of the acceptor before acceptance:
when the offered due or become insane before the acceptance of the
proposal and this fact come to the knowledge of the acceptor. The
proposal is lapsed by making counter offer.

Revocation of Acceptance

Section 5 of the contract act provides that the acceptance may be

revoked nay time but before the communication of acceptance is
complete against the acceptor. It means that acceptance cannot be
revoked when its communication is complete against the acceptor.
Thus by section 5 it is very clear that under Indian law contract
acceptance is revocable within particular time.
Adam vs lindcell 1818ER250

Complication of communication of acceptance

Section 9 of Indian contract act provides about the completion of

communication of acceptance according to this section the
communication of acceptance is complete against the proposer and
acceptor not at same time but at the different time as following.

Against the Proposer: The communication of acceptance become

complete against the proposer when it is put in course of
transmission to him so as to be out of the power of the acceptor
Against the Acceptor: The communication become complete
against the acceptor when it come in the knowledge of the proposer.

(1) The buyer may revoke his acceptance of a lot or commercial unit whose
non-conformity substantially impairs its value to him if he has accepted it
(a) on the reasonable assumption that its non-conformity would be
cured and it has not been seasonably cured; or
(b) Without discovery of such non-conformity if his acceptance was
reasonably induced either by the difficulty of discovery before
acceptance or by the seller's assurances.
(2) Revocation of acceptance must occur within a reasonable time after
the buyer discovers or should have discovered the ground for it and before
any substantial change in condition of the goods which is not caused by
their own defects. It is not effective until the buyer notifies the sellerof it.
(3) A buyer who so revokes has the same rights and duties with regard to
the goods Involved as if he had rejected them.

An acceptance may be revoked at any time before the communication of the

acceptance is complete as against the acceptor, but not afterwards.
Illustrations A proposes, by a letter sent by post, to sell his house to B. A
proposes, by a letter sent by post, to sell his house to B." B accepts the
proposal by a letter sent by post. B accepts the proposal by a letter sent by
post." A may revoke his proposal at any time before or at the moment when
B posts his letter of acceptance, but not afterwards. A may revoke his
proposal 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 the letter communicating it reaches A, but

not afterwards. B may revoke his acceptance at any time before or at the
moment when the letter communicating it reaches A, but not afterwards.

Revocation how made.A proposal is revoked A proposal is revoked"

(1) by the communication of notice of revocation by the proposer to the
other party;
(2) by the lapse of the time prescribed in such proposal for its acceptance,
or, if no time is so prescribed, by the lapse of a reasonable time, without
communication of the acceptance;
(3) by the failure of the acceptor to fulfil a condition precedent to
acceptance; or
(4) by the death or insanity of the proposer, if the fact of his death or
insanity comes to the knowledge of the acceptor before acceptance.

Case Law used in Assignment

1- Lucy V Zehmer,196 Va 493 84 S.E. 2d 516
2- In McPherson Vs. Alana
3- Felt house Vs. Bindley (1863), 7 L.T. 835
4- Authority vs. Ravinder Mohan Aggarwal, 1999(3), SCC 172
5- Powell vs. Lee (1908), 99 L.T. 284
6- Adam vs. lindcell 1818ER250

Contents
1)
2)

Case law used

Acceptance Introduction

3)
4)
5)
6)

Meaning and definition of acceptance

Effect of acceptance
Test of acceptance
Conditions for valid acceptance
a) Acceptance must be absolute and unqualified
b) Acceptance must be in prescribed manner
c) Acceptance must be communicated
d)Only authorized person should communicate about the
acceptance
e) Acceptance should be made within the time prescribed or
within a reasonable time
f) Acceptance before the lapse of proposal

7)
8)

Revocation how made

Revocation of acceptance
a) Against the proposer
b) Against the Acceptor
9)

Bibliography

Bibliography
Book sources:
Law of Contract- Avatar Singh

The Indian Contract Act, 1872

Class Notes

Internet sources:
Law Notes .In
Google- Wikipedia

These are the sources from where I took help for

completion of my contract project on the topic Revocation
of acceptance.