In fact, the efficacy of, or need for, the rule to generate performance at that point has been doubted. The assumption that the safety, provided for the offeree by the postal rule, produces, or is needed to produce, performance as soon as possible, is open to question. However, even if that assumption is accepted, the balance point of economic efficiency can be strongly contended to be different in relation to more modern, and much faster, means of communication.
There are now multiple fast, cheap, means by which the offeree can accept, and can check receipt of acceptance. They not only markedly reduce the potential for an intervening revocation, they also very significantly diminish the time before performance by both parties can safely commence. Allocating the non-fault risk of loss, or delay, of the acceptance, to the inappropriate party — the offeror — should no longer be viewed as a price which has to be paid for the benefit of performance commencing swiftly.
To the contrary, unless a very strong approach is taken to the reasonableness of using the post, which would simply render the postal rule meaningless, even maintaining the postal rule just in relation to the post, may be seen to be inefficient.
We have seen that it was not a basis of the postal rule that it puts the, non-fault, risk of the loss, or delay, of an acceptance on the offeror. That was not a function of the rule. It was an undesirable side effect of it, and it should certainly not be seen as a reason to extend, or even maintain the rule. It is in fact a reason to apply a receipt rule.
Further, it would seem that if the postal rule ever was economically efficient, it should not be so viewed now. However, the postal rule does put the risk of loss or delay due to the fault of the offeror, on the offeror, and, more importantly, it deals with the revocation issue.
The potential for the revocation issue to arise is considerably less with faster means of communication, but it is not removed. Such an exercise is difficult to conduct, but it seems extremely unlikely that it comes down in favour of extending the postal rule, and the telex cases could be seen as indicating that the courts reached that conclusion.
However, it can be contended that the telex cases did not simply envisage abandoning the benefits of a dispatch rule, but left the situations where it would impact positively to be returned to when the need arose. These examples are largely concerned with the gap between dispatch and receipt, which creates the potential for the revocation issue.
In short, Lord Wilberforce was concerned that the extension of the postal rule should not simply be denied in those situations where a dispatch rule would have benefits. Plainly, he envisaged that a different rule, or rules, might be needed to deal with those circumstances. It is the revocation issue which will be specifically addressed, but as will be clear, the same approach could be used to produce the allocation to the offeror of the risk of loss or delay occasioned by the fault of the offeror.
One way of dealing with the revocation issue, without the postal rule would be through legislation taking the same approach as the DCFR and CISG, so that the acceptance would only be effective on receipt, but a revocation could not be effective once an acceptance had been dispatched. However, absent such legislation, what must be considered is whether the revocation issue could be dealt with at common law, without the postal rule.
A revocation problem arises in relation to the commencement of the actions required under a unilateral offer. In Errington v Errington v Woods [] 1 KB , where a father had made a down payment, purchased a house on a mortgage, and told his son and daughter in law that they could live in it, and that he would convey it to them, if they paid off the mortgage, Denning LJ took the line that at :.
Consideration should be given to dealing with the revocation issue by means of an implied term. What must be looked at is the implication of a term in law. Replacing the postal rule with an implied term will need a degree of specificity of the term, and reliability of the implication, which means that there could be no reality in seeking to give it existence as a term implied in fact, which is generated by the intention of the parties. A term implied in law does not face those problems, and the role of such terms makes it an apposite approach.
Such an implied term would have the necessary specificity, and reliability of implication, to replace the role of the postal rule in relation to the revocation issue. The particular implication will be returned to below. However, first we should consider the determination of an implication in law.
It is the implication, in law, of a previously unrecognised term which causes difficulties. He stated at [36] :. Necessity is, indeed, not what should be focussed on.
It is plain that implying a previously unrecognised term in law will rarely be simple. However, when what is under consideration is a term implied in law taking on the role of the postal rule in relation to the revocation issue, the situation is, in one way, relatively straightforward.
To an extent, nothing new would be taking place. There is a longstanding acceptance of the need to deal with the revocation issue. However, clearly there are aspects of the implication contended for here which are not straightforward. In using an implied term to substitute for the postal rule we would be doing more than implying a term in law: we would also be implying the contract containing it.
The pre-contractual context is one in which the courts are particularly cautious about intervening, but the long existence of the postal rule should alleviate such concerns in relation to dealing with the revocation issue.
This would mean that the unreality of a rule creating a bilateral contract upon mere dispatch of an acceptance need no longer be accepted, but it becomes clear that what is in question is the reaching of a point in the contracting process which means that a revocation is inappropriate.
The insight this brings to its role will give pause. Of course, what is envisaged here is a very limited intrusion on freedom of contract. The offeror has, in a very real sense, passed beyond mere negotiation. He, or she, has made an offer, and the only question is whether he, or she, is able to take advantage of the time between the dispatch and receipt of an acceptance to escape from what would have been a contract had there been no such time gap.
Further, the greatest pressure for development of a general principle of good faith in English Law comes from our closer involvement with European Law, and the law of other European countries, where such principles are prevalent, and also from increasing reference to good faith in other common law jurisdictions McKendrick , They do not provide a drive towards particular requirements, and if English law does move towards a principle of good faith, it will develop in its own way: cautiously, and reflecting its emphasis upon certainty and freedom of contract.
In the former, Leggat J did strive to limit the impact, beyond the particular case, of the finding of an implied term concerned with good faith, by seeking to identify it as a term implied in fact, rather than law, 15 and in the latter, the court had to construe an express term referring to good faith, and took a narrow approach, in doing so. Terms implied in law are being recognised as a means of dealing with good faith problems, and the revocation issue is narrow, and has long been met by the postal rule.
Implying a term in law to replace its impact in relation to the revocation issue would not be incautious, and should not conjure any visions of the floodgates being opened to the levels of uncertainty, and infringement of freedom of contract, fears of which can be evoked by references to good faith.
Plainly, it would be more succinct to state the requirement by referring to whether the method of communication was non-instantaneous, which is when there is scope for such an event. Plainly, face-to-face communication does not fall within it, 16 and e-mail does. The same points could be made in relation to communications carried out by Instant Messaging, where there may be simultaneous two-way communication or a message can be left to be received later Mik , There should, however, be a further reflection of the restriction on the postal rule that it only applied where it was reasonable to use the post.
Thus, when the offer was made, it might have been reasonable to use e-mail to accept, but by the time the acceptance takes place, it would only be reasonable to do so by a telephone conversation, or by Instant Messaging if it was first established that simultaneous communication was taking place.
BBTC Co. As previously explained, when the notice of exercise of the option is viewed as an acceptance of an irrevocable offer, such notice is clearly covered by section Please help us improve our site! No thank you. Please fill out the contact form below and we will reply as soon as possible. Discussion Question What do you think about the mailbox rule? The offer is accepted once the acceptance is communicated.
In this situation, the moment when the letter is mailed by the offeree. The general rule provides that acceptance is communicated up on dispatch of the letter and becomes effective once the offeror receives the letter. However, the letter communicating the acceptance must be dispatched timely and in a proper manner so as to avoid any inconveniences.
If the acceptance letter is dispatched within the correct time, a valid contract is established. This means that the time the offeror receives the letter is not a determining factor.
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