Business Law: Offer and Acceptance - Essay Example

The offer letter was also duly signed by Jennings, further confirming his intention to offer the car for sale to Wheeler. The offer letter, sent by any means like a post or through personal delivery, was duly received by Wheeler and this fact is confirmed by his subsequent action, viz., to accept the offer and tendering the sale price of $13,500 on 29 September.

Thus Jennings’ letter of September 1 to Wheeler is a valid offer on the date of its acceptance by Wheeler. This offer was not withdrawn or amended by Jennings before Wheeler communicated his acceptance.

Validity of acceptance

Wheeler responded to the offer letter by accepting it on 29 September and tendering the sale price. The date of acceptance is well within the validity period of the offer viz., October 9. However, it is seen that till September 15, there was no communication from Wheeler to Jennings and this period of silence can be construed as a fair and reasonable period of waiting for Jennings to decide on his next course of action if he thought that Wheeler may not be interested in the offer. However, since no consideration was exchanged between the two parties, Jennings was free to revoke his offer at any time.

The options available for Jennings as on September 15 are a) to wait for Wheeler’s response till the expiry of the validity period of the offer or, b) to withdraw his offer (rescind or revoke) and to sell off the item to another person. Waiting for Wheeler’s response till October 9 would have given unilateral freedom of action to Jennings since the validity of the offer expires on that date. In case Jennings was in a position to make the sale by an earlier date, he could do so but he should have first withdrawn his offer to Wheeler on the grounds that a) he received no consideration and b) he had waited for a reasonable time period viz. up to September 15 to hear Wheeler’s response. His action to dispose of the car without withdrawing the offer made to Wheeler created the dispute. Thus, as on 29 September, the offer subsisted and hence its acceptance automatically created a legally binding contract between the parties.

It is to be noted that Wheeler could have conveyed his acceptance by an earlier date but would still be able to make payment before October 9, as per the offer condition.

Contract and breach

An offer becomes a contract when it is accepted by the offeree unconditionally and within the validity period. Wheeler accepted the offer within its validity period and hence he entered into a valid contract with Jennings. Since Jennings disposed of the car without notifying the withdrawal of the earlier offer before its acceptance, he is in breach of the contract.