Legal Rules for Communication under the Act
1. Intention of the Offeror to establish Legal Ties [Section 2(b)]: For an offer to be considered legitimate, the offeror must have the intention of establishing legal ties. It is common for social or domestic agreements to lack this aim, and as a result, they are not legally enforceable.
2. Communication of Acceptance and the Mode of Communication (Section 7): The offeree is required to convey acceptance to the offeror in a way that is either explicitly stated in the offer or inferred by the offer. Except in situations in which there is a process of dealing, or where silence is the typical way between the parties, silence does not generally signify acceptance.
3. Exemption for Unilateral Contracts (Section 5): In the event of unilateral contracts, where acceptance is conducted by performance, the offeror is not permitted to withdraw after performance has been commenced, provided that the offeree is actively carrying out the act.
4. Instant Methods of Communication [Section 4(3)]: In transactions in which the parties are located in separate locations and communication is instantaneous, for example, by phone or email, the withdrawal of the offer does not take effect until the offeree receives it.
5. Electronic Communication and the Formation of Contracts: Recognise the legality of contracts that are made by electronic communication, as the Indian Contract Act recognizes the use of electronic methods for offer, acceptance, and revocation of contracts.
Communication of Offer, Acceptance and Revocation
When it comes to the field of contract law, efficient communication is a fundamental component that determines the process of forming, accepting, and rescinding offers. In 1872, the Indian Contract Act was created, which offers a thorough foundation for comprehending the dynamics of communication within contractual relationships. To shed light on the intricacies that drive these essential components of contract formation in India, this essay dives into the fundamental concepts that underline the communication of offer, acceptance, and revocation.
A clear and definite offer is required under Section 2(a), which states that “An offer must be able to create a legally enforceable agreement and must be clear and definite. Uncertainty and the possibility of disagreements might result from terminology that is ambiguous or vague.”
Geeky Takeaways:
- When contracting parties are face to face and negotiate in person, there is an instantaneous communication of offer and acceptance which gives rise to a valid contract.
- A valid contract comes into existence when the moment the offeree gives his absolute and unqualified acceptance to the proposal made by the offeror.
- The question of revocation does not arise in cases where an offer is made and accepted instantly at the same time.
- Thus, communication plays an important role in the Indian Contract Act, 1872.
Table of Content
- Communication of an Offer
- Legal Rules for Communication under the Act
- Communication of an Acceptance
- Communication of Revocation
- Time during which an Offer or Acceptance can be Revoked
- Effect of Delay or Loss of Letter of Acceptance in Postal Transit
- Accidental Formation of a Contract
- Contracts over the Telephone
- Conclusion
- Frequently Asked Questions (FAQs)
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