contract by correspondence is a state in which contract is made without actual meeting of the parties

1. OFFER AND ACCEPTANCE IN
CONTRACT BY CORRESPONDENCE
Presented by: Shreya Pandey
Roll no.:73
SAP ID:500041255

2. CONTRACT IN CORRESPONDENCE
 A contract is said to be in correspondence when:
 The contracting parties do not directly meet.
 when an offer is given by the offeror by
telegram
 If the offer is given by e-mails or
 If an offer is made on telephone.

3. OFFER MADE IN CORRESPONDENCE:
 An offer is made with the view of obtaining the view
of another party to do or abstain from doing a
particular thing.
 The offer must be communicated to the offeree by
the offeror.
 An offer is not made unless it comes under the
notice of the another party.

4. ACCEPTANCE IN CORRESPONDENCE:
 An offer is considered to be accepted as the letter of
acceptance has been posted to the offeror.
 The acceptance must be communicated by the
offeree to the offeror. Powell v Lee (1908) 99 LT
284
 If there is any condition on the offer to be followed by
the offeree at the time of acceptance then it must be
followed otherwise the contract will not be formed.
 Acceptance must be done before the time lapses. If
the offeree takes too long and then accepts the offer
then the offeror is mot binding to follow it.
 Hyde v Wrench [1840] EWHC Ch J90. this case
statest hat if there will be any modification done by
the offeree in the contract then the offeror is not
binding.

5. REVOCATION IN CORRESPONDENCE
 Revocation is the act of recall or annulment. It is
the reversal of an act, the recalling of a grant or
privilege, or the making void of some
deed previously existing.
 In contaract by correspondence the revocation
letter must reach the offeror before the letter of
acceptance if not then the contract will become
binding.
 An offeror can revoke the letter unless all the
conditions of contract are fulfilled by the offeree.
But as soon as he comes up with all the conditions
the contract will become binding on the offeror

6. POSTAL RULE
 As a rule of convenience, if the offer is accepted by
post, the contract comes into existence at the
moment that the acceptance was posted (Adams v.
Lindsell (1818) 106 ER 250). This rule only applies
when, impliedly or explicitly, the parties have post in
contemplation as a means of acceptance. It
excludes contracts involving land, letters incorrectly
addressed and instantaneous modes of
communication. The relevance of this early 19th
century rule to modern conditions, when many
quicker means of communication are available has
been questioned, but the rule remains good law for
the time being.

7. THEORIES ADVANCED TO DETERMINE THE
TIME OF FORMATION:
 There are two theories which determines the time
of formation:
 (1) Declaration theorier
 (i)declaration “strictu sensu”.
 (ii)expidition.
 (iii)reception
 (2) Information theories.

8. DECLARATION THEORIES:
 (1)declaration “strictu sensu”:
In contracts by correspondence, as soon as the will
of the offeree finds itself in the presence of the
express and existing will of the offeror, and adheres to
it in a manner equally express, the consent of the two
parties is realized and their wills take reciprocal
possession of one another.
(2)expidition:The acceptance of the offer binds, only
now we select that one point in time which is common
to all acceptances - the time of mailing a letter or
dispatching a telegram, etc.

9. (3)reception:
The adherents of this theory state that the contract is formed
only when the letter containing the offer is received by the offeror. They argue
that only on receipt is the acceptance truly definitive for then the offeree
cannot withdraw his acceptance.

10. INFORMATION THEORY:
 With this theory we have returned to the classical
situation. The written word must be seen just as the
spoken word is heard.The acceptance contained in
a letter or telegram is of no legal consequence until
it comes to the knowledge of the offeror. Only when
he knows that his offer has been accepted is the
contract formed.This approach seems quite
reasonable, yet when it is applied to contracts by
correspondence it creates a bias in favour of the
offeror. He knows when the contract has been
formed but the offeree is left in the dark. The
offeree does not know when his acceptance came
to the knowledge of the offeror.