The general rule for acceptances by post is that they take effect when they are posted, rather than when they are communicated. The main reason for this rule is historical since it dates from a time when communication through the post was even slower and less reliable than it is today. Even now, there is some practical purpose for the rule, in that it is easier to prove that a letter has been posted than to prove that it has been received or brought to the attention of the offeror.

The postal rule which was laid down in Adams v Lindsell (1818) saw the court decide that a contract was concluded as soon as the acceptance was posted.

The postal rule was applied to the acceptance by telegram in Cowan v O’Connor (1888) where it was held that an acceptance came into effect when the telegram was placed with the post office.

Application of the postal rule

  • The letter must be posted. This means a letter is in the control of the post office.
  • Use of postal service must be reasonable. Only when it is reasonable to use the post to indicate acceptance can the postal rule apply.
  • Manifest inconvenience and absurdity.

Effect of the postal rule

The postal rule has three main practical consequences:

  1. A postal acceptance can take effect when it is posted, even if it gets lost in the post and never reaches the offeror.
  2. Where an acceptance is posted after the offeree posts a revocation of the offer, but before that revocation has been received, the acceptance will be binding (posted acceptances take effect on posting, and posted revocations take effect on communication).
  3. The contract is completed at the time of posting, so it has priority over any other contract concerning the same subject matter which was made after the original acceptance was posted but before it had reached the offeror.

Exceptions to the postal rule

  • Offers requiring communication of acceptance. An offeror may avoid the postal rule by making it a term of their offer that acceptance will only take effect when it is communicated to them.
  • Instant methods of communication. When an acceptance is made by an instant mode of communication, such as telephone or telex, the postal rule does not apply.
  • Misdirected acceptance. Where a letter of acceptance is lost or delayed because the offeree has wrongly or incompletely addressed it through their own carelessness, it seems reasonable that the postal rule should not apply, although there is no precise authority to this effect.

Withdrawal of postal acceptance

Where the postal rule applies, it seems unlikely that an offeree could revoke a postal acceptance by phone or some other instant means of communication before it arrives. The Scottish case of Dunmore v Alexander (1830) does appear to be such revocation, though the court’s views were only obiter on this point.

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