Acceptance & Rules of Acceptance.pptx

Acceptance and rules of acceptance according to the Company Act 2013

1. Acceptance & Rules of Acceptance Presented By:- Kanhu Charan Sahoo Faijan Mustafa Sahil Kumar Barik Chapter- Offer And Acceptance(Business Law) With Cases And Examples

2. CONTENTS Meaning of Acceptance Who can accept Rules of Acceptance

3. Meaning Of Acceptance When the person to whom the offer is made signifies his/her assent thereto, the offer is said to be accepted . Section 2(b) of Indian ConractAct1872 Example : A says to B that he wants to sell his car for Rs.1,00,000.B says to A in reply that he is prepared to buy his car for 1,00,000 .Here B has accepted the proposal of A .

4. Who Can Accept An offer can be accepted only by the person to whom it is made . Acceptance by any other person is not a valid acceptance . If an offer is made by A to B, only B can accept or reject the offer . But if it is a general offer, then anybody can accept it . Case – Boulton Vs. Jones

5. Rules Of Acceptance Acceptance Must Be Absolute And Unconditional The acceptance ,to be binding , must be absolute and unqualified .Qualified acceptance is not a contractual acceptance . Example – A proposes to sell his watch to B for 1000, to which B says that he is prepared to pay only 800 for it .When a counter offer is made ,the original offer is no more valid ,and until the counter offer is accepted by the original offerer there can be no agreement .

6. 2. Acceptance must be communicated to the offeror If the acceptance of offer is not communicated to the person making the offer ,the acceptance is not valid in terms of law . Case – Brogdon vs. Metropolitian Rail Company A draft agreement relating to the supply of coal was sent to the manager of the company for his approval .the manager wrote the word ‘Approved’ and put the draft in his drawer intending to send it to the company’s solicitor for a formal agreement to be drawn up .the document remained in the drawer by oversight ,and the court ruled that there did not exist a contract since the acceptance was not communicated to the offeror .

7. 3. Acceptance must be made in the prescribed manner According to Section 7(2) of the Act ,if the person making the offer has prescribed a method for its acceptance ,the acceptance must be by that method . For Example : If the proposer wants the acceptance to be communicated by telegram,it must be done telegraphically.If the manner of acceptance is not prescribed ,the acceptance should be in an appropriate manner .

8. 4. The Proposer can not prescribe the method of Refusal The proposer needs to be informed if the offer made by him is accepted, but he cannot insist on him being ionformed of its non-acceptance . For Example : A writes to B that he wants to sell his car to him for 1,00,000 ,and if he (A) does not get reply from B by return post, he would presume that B has agreed to buy the car .The proposer cannot prescribe the method of refusal .

9. 5. An offer once rejected ,cannot be accepted until it is Renewed For Example : If A offers to sell 100 quintals of sugar to B at 1000 per quintals ,and B writes back that he is prepared to buy sugar only at 750 per quintal, B has rejected A’s proposal ,and if B sends another Telegram saying that he is prepared to buy at 1000 per quintal ,A is not bound by it because ,A’s original offer has been rejected by B .Technically ,the second communication from B to A is a new proposal from B .

10. 6. Acceptance may be Express or Implied Express acceptance may be written or by word of mouth whereas implied acceptance could be reflected by the action or behavior of the person accepting the offer . For Example : When a passenger boards a bus to go to a particular place for a fixed fare to be charged by the bus company ,it is a implied acceptance of the company’s offer which is symbolised by the passenger’s action in boarding the bus .

11. 7. An Action without the knowledge of the proposal is no Acceptance Acceptance can be given only by the person to whom the proposal is made . If a person does not have a knowledge of the proposal ,obviously has not been made to him and he cannot give his acceptance as such . When the offer comes to the knowledge of acceptor ,It is said to be complete .

12. 8. Acceptance can only be given by the person to whom the offer is made This is true to a specific proposal which can only accepted or not accepted by the person to whom it is made .However, a general proposal which is made to the public at large can be accepted by any person who has a knowledge of the proposal .

13. 9. Acceptance must be made before the lapse or withdrawal of an offer If the person making the offer has set a limit for its acceptance , the offer must be accepted within that time. If no time limit has been set ,the offer must be accepted within a reasonable time . For Example : A offers to sell his scooter to B for Rs.10,000 and wants B’s acceptance with in a week ,but did not receive any response from B . B sends his acceptance on the eighth day ,In such circumstances ,the proposal has lapsed ,and B cannot hold A answerable for his offer .

14. 10. Mental acceptance is no Acceptance Mere mental acceptance which is not expressed in words or in writing is not recognized as acceptance from legal standpoint . In other words , there must not only be a desire to accept, but the desire must be expressed in words /oral/written .