Ans.1) Acceptance
must be given by the person to whom the proposal is made:
An acceptance to be valid must be
given only by a person to whom offer has been given. In other words, acceptance
must move from the offeree and no one else.
Example : X offered to sell his house to Y. Here only Y can accept
the offer.
However, acceptance can also be given by an
Agent on behalf of his principal.
2) Acceptance
can be given only when the acceptor has the knowledge of the offer:
Acceptance cannot be given without the
knowledge of offer.
Leading Case : Lalman
Shukla Vs. Gauri Dutt.
3) Acceptance
must be absolute and unconditional:
It is another important essential
element of a valid acceptance. A valid contract arises only if the acceptance
is absolute and unconditional. It means that the acceptance should be in total
(i.e. of all the terms of the offer), and without any condition.
Thus, an acceptance with a variation
is no acceptance. It is simply a counter offer. A counter offer puts an end to
the original offer, and it cannot be revived by subsequent acceptance. Example : X offered to sell his house for Rs. 1,80,000 to Y. Y wrote a
letter stating that he was prepared to buy it for Rs. 1,60,000. This is a
counter offer, and not acceptance. Now, if Y accepts the original offer to buy
the house for Rs. 1,80,000, X will not be bound to sell the house, because Y’s
counter offer has put an end to the original offer.
Leading Case : Nihal Chand Vs. Amarnath, AIR 1926 Lah. 645
If only a part of offer is accepted, then the
acceptance is invalid and without any legal effect. If the offer is accepted
with some condition then also the acceptance is invalid and without any legal
effect.
4) Acceptance
must be given within the time pre-scribed or within a reasonable time:
Sometimes, the time limit is fixed
within which an acceptance is to be given. In such cases, the acceptance must be
given within the fixed time limit. In case, no time is prescribed, the
acceptance should be given within a reasonable time. The term ‘reasonable time’
depends upon the facts and circumstances of each case. Example : X applied for shares in a company in July. The
allotment (acceptance) of shares was made in late December. X refused to take
shares. It was held that the allotment of shares was not within a reasonable
time, therefore X was not bound by the allotment.
Leading Case: Ramsgate Victoria Hotel Co. Vs. Monteflore
(1866) LR I Ex. 109
5) Acceptance
must be given before the lapse of offer:
A valid contract can arise only when
the acceptance is given before the offer has elapsed or withdrawn. An
acceptance which is made after the withdrawal of the offer is invalid, and does
not create any legal relationship.
Example : X offered, by a letter, to sell his horse to Y
for Rs. 2500. Subsequently, X withdrew his offer by a telegram which was also
received by Y. After the receipt of this telegram. Y accepted the offer by a
letter, and posted the same. In this case, the acceptance is invalid as it was
made after the effective withdrawal of the offer.
6) Acceptance
must be communicated:
It is an important and essential
element of a valid acceptance. The definition of acceptance as given in Sec.
2(b) emphasises this requirement. According to this Section, the consent to the
offer should be signified (i.e. indicated or declared). In other words, the
acceptance is completed only when it has been communicated to the offeror. It
may be noted that until the acceptance is communicated, it does not create any
legal relations.
Example: X offers to buy Y’s
plot of land for Rs. 10 lakhs. Y discusses the proposal with Z his own lawyer,
and agrees to sell the plot for Rs. 10 lakh. But Y does not communicate the
acceptance to X. In this case, no contract comes into existence between X and Y.
Thus, a mere mental determination to accept is
not acceptance unless it is accompanied by an external indication. The
requirement is that there should be some external manifestation of acceptance.
7) Acceptance
must be communicated to the offeror himself:
A valid contract arises only if the
acceptance is communicated to the offeror himself. If acceptance is
communicated to the person, other than the offeror, it will not create any
legal relationship. In fact, such communication is no communication at all.
Example : X offered to purchase Y’s horse and wrote a letter
saying, “If 1 hear no more about the horse. 1 shall consider the horse mine at
£35". To this letter no reply was sent, but Y instructed Z an auctioneer,
not to sell the horse as it was already sold to X. By mistake, Z put up the horse for auction and sold it. X
filed a suit against Z on the ground that under the contract the horse had
become his property and Z is liable for conversion of his property. But his
action failed. In this case X in his own mind accepted the offer. But he had
not communicated his acceptance to Y.
Leading Case: Felthouse Vs. Bindley (1863) 7LT 835
However, if the offer is made by an agent on
behalf of his principal, then the acceptance may be communicated, either to the
principal or his agent.
8) Acceptance
must be in the prescribed manner:
It is the legal rule of the acceptance
that it must be accepted in the prescribed manner. If the offer is not accepted
in the prescribed manner, then the offeror may reject the acceptance within
reasonable time. It may however, be noted that, if the offeror does not reject
the acceptance within a reasonable time, then he becomes bound by the
acceptance. [Sec. 7(2)]
Example : X offered through a letter, to sell his car to
Y for Rs. 2,70,000. He also wrote that it should be accepted by letter only. Y
instead of writing a letter, sent his authorised agent to X conveying the
message that he has accepted the offer. Y’s acceptance is not in the prescribed
manner. X may reject it within reasonable time. But if he does not reject
within reasonable time, he shall be deemed to have accepted the acceptance, and
a valid contract will arise between X and Y.
9) Acceptance
must be given in some usual and reasonable manner:
It is another important legal rule of
an acceptance that where no mode is prescribed, acceptance must be given in
some usual and reasonable manner. In such cases, the mail course is considered,
a very reasonable manner.
Leading Case: Dunlop Vs. Higgins (1848) I HLC 381
10) Acceptance
must show an intention that acceptor is willing to fulfil the terms of the
offer:
A
valid contract can arise only when the acceptance is given with the intention
of fulfilling the terms of the contract. An acceptance which is made jokingly
and without any intention of entering into a contract, is invalid and does not
create any legal relationship.
11) Acceptance
may be express or implied:
An acceptance, which is expressed by
words written or spoken, is called an express acceptance. [Sec. 9]
Example: X wrote to Y in a letter, “I want to sell my
black horse for Rs. 12,000".Y replied by a letter “I am ready and willing
to buy your black horse for Rs. 12,000". Here Y’s acceptance is express
acceptance as it is made in writing. Acceptance is implied when it is inferred
from the conduct of the parties.
Example : At
an auction sale of a car, X is the highest bidder. The auctioneer accepts the
bid (i.e. offer) by striking the hammer on the table. It is an implied
acceptance. Here, auctioneer’s conduct of striking the hammer on the table
shows that the auctioneer has accepted the highest bid.
12) Acceptance
cannot be presumed from silence. Mere silence is not acceptance:
Sometimes, the acceptor does not
convey his decision to the offeror/and keeps silent. In such a case, his
silence does not amount to acceptance. Similarly, the offeror does not have the
legal rights to say that if no answer is received within a certain time, the
offer shall be deemed to have been accepted.
He (the offeror) cannot impose a
condition that offeree’s silence will be regarded as equivalent to acceptance.
Leading Case: Felthouse
l/s. Bindley (1863) 7 LT 835.
Example: X offered his car to Y for Rs. 95,000, and
wrote that if he did not hear from him (Y) within a week, he would assume that
he has accepted offer. No reply was given by Y. In this case, no valid contract is concluded between X and Y. 
