Majority of the arguments on the mode of acceptance have revolved around the receipt rule and the postal rule
Majority of the arguments on the mode of acceptance have revolved around the receipt rule and the postal rule. The receipt rule states acceptance becomes effective once received by the offeror, and by the postal rule; acceptance is effective once the letter of acceptance is posted. Yet, with either the receipt or the postal rule, an offeror may lack the knowledge that a contract has been formed. Also, in view of technological advancements and the various instantaneous means of communication, for example, SMS, Call services, Emails, there is the likelihood that the traditional nature of the postal system will be negated. Yet, even instantaneous means of communication has been identified to possess a higher likelihood of failing to communicate acceptance compared to the post. For example, with the Email, the effectiveness of a communicated acceptance can be affected by security settings on the addressee’s side designed to counteract viruses and spam and so prevent the message from being delivered or to be delivered to the junk folder. Furthermore, although instantaneous transmission is viewed as constituting a pre-requisite of real-time communications, it is not seen as a decisive feature in establishing the time of formation and so does not reduce communication risk or failures.
Nevertheless, a worthy solution to determining acceptance in electronic contracts, was offered in the reasoning of Lord Wilberforce in Brinkibon v Stahag und Stahlwarenhandelsgesellschaft mbH that, “the question whether acceptance become effective on dispatch or on receipt must be resolved by reference to the intention of the parties, by sound business practice and by a judgment of where the risks should lie.” Also, according to Karl “the letter of contract law states that the maker of an offer has the right to define how the offer may be accepted.” On this ground, it appears that the easiest way to determine acceptance is for the parties to state the acceptable mode of communicating acceptance in their contract terms and conditions. In practice, this is often done within the vendor’s terms and conditions.
