This is an extract of our Communication Of Acceptance document, which we sell as part of our GDL Contract Law Notes collection written by the top tier of Cambridge/Bpp/College Of Law students.
The following is a more accessble plain text extract of the PDF sample above, taken from our GDL Contract Law Notes. Due to the challenges of extracting text from PDFs, it will have odd formatting:
COMMUNICATION OF ACCEPTANCE
In some cases acceptance by conduct is permissible:
o This is the case in unilateral contracts: Carlill v Carbolic
Smoke Ball Co (1893)
This may seem difficult to reconcile with judicial points re ad idem
Incomplete negotiations may be overtaken by the parties'
Brogden v Metropolitan Railway (1876) - Brogden supplied coal to MR for two years without a contract.
Railway drew up contract to continue relationship.
Brogden made a counter offer (left some parts blank).
This was put in the desk draw.
HoL held that Brogden's counter-offer had been accepted by the conduct of the company in placing orders for coal on its terms.
Lord Blackburn: "if both parties have acted upon that draft and treated it as binding, they will be bound by it".
British Steel Corporation v Cleveland Bridge
 - shows limits of the realism of Brogden
British Steel received a letter of intent from
Cleveland, expecting a contract to follow shortly.
Requested BS started manufacture immediately.
Parties failed to reach a consensus.
Held no contract had arisen (BS could therefore claim on quantum meruit basis), Goff J found that it was impossible to say what the terms of this purported contract were.
No unilateral contract had arisen as terms were undecided.
Professor Atiyah argues that this case sets a limit to what can be done by taking a "realistic" view of contract formation.
Acceptance by Silence/Inactivity - Generally not held to be valid acceptance.
o Felthouse v Bindley (1862) - Uncle wrote to Felthouse offering to buy a horse, saying "If I hear no more about him, I
consider the horse mine at £30 15s". F never replied, but instructed auctioneer to sell everything except his horse which was already sold. Auctioneer sold horse.
Action for tort of conversion against auctioneer failed as there was no acceptance on the facts.
This case actually mostly turns on its facts and the
Statute of Frauds.
Willes J; "it is also clear that the uncle had no right to impose upon the nephew a sale of his horse …unless he chose to comply with the condition of writing to repudiate the offer".
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