The document summarizes key legal concepts around acceptance in contract law: 1. Acceptance is the manifestation of assent to the terms of an offer, forming an agreement or contract. It must conform completely to the offer. 2. For a valid acceptance, communication to the offeror is required. Acceptance takes effect when put in the course of transmission (against offeror) or when knowledge is received (against acceptor). 3. Case law examples demonstrate that acceptance must meet all offer terms, lapse if not communicated in a reasonable time, and not be implied from silence alone. A mere mental acceptance without external expression is not valid.

1. Presented By: Group 06
Faraz Ahmed (BL-1462)
Habib Raza (BL-1456)
Tahir Ali (BL-1464)

2. ACCEPTANCE
 Section 2(b) of the Contract Act defines
the term 'acceptance’ as
 "when the person to whom the
proposal is made signifies his assent
thereto, the proposal is said to be
accepted.
 A proposal when accepted becomes
a promise. "

3.  A contract emerges from the acceptance of
an offer. Acceptance is the act of
assenting by the offeree to an offer .
 In other words, it is the manifestation by
the offeree of his willingness to be bound
by the terms of the offer.
 This means ‘when the offeree signifies his
assent to the offeror, the offer is said to be
accepted’.

4.  Section 9. Promises, express and implied. In
so far as the proposal, or acceptance of any
promise is made in words, the promise is
said to be express. In so far as such
proposal or acceptance is made otherwise
than in words, the promise is said to be
implied.
 An acceptance may be express or implied.
 • It is express when it is communicated by
words, spoken or written or by doing some
required act.
 • It is implied when it is to be gathered from
the surrounding circumstances of the cases or
the conduct of the parties.

5. Who can Accept an Offer?
 Acceptance of a particular offer: When
an offer is made to a particular person, it
can only be accepted by him alone. If it
is accepted by any other person, there is
no valid acceptance.
 The rule of law is clear that if you
propose to make a contract with ‘A’,
‘B’ cannot substitute himself for a A ‘
without your consent (agent).

6.  Acceptance of a general offer
 When an offer is made to world at large,
any persons to whom the offer is made
can accept it.
 [Mrs.Carlill Vs.Carbolic Smoke ball
Co.(1893)

7. Legal Rules as to
Acceptance
 The acceptance of an offer is the very essence of a
contract.
 To be legally effective, it must satisfy the following conditions:
1. It must be absolute and unconditional i.e., it must conform with
the offer.
2. It must be communicated to the offeror
3. It must be according to the mode prescribed or usual and
reasonable mode.
4. It must be given within a reasonable time.
5. It cannot precede an offer.
6. It must show an intention on the part of the acceptor to fulfill
terms of the promise.
7. It must be given by the party or parties to whom the offer is
made.
8. It must be given before the offer lapses or before the offer is
withdrawn.

8.  It must be absolute and unconditional
 It must conform with the offer
 An acceptance, in order to be binding, must be
absolute and unqualified [Sec.7(1)] in respect
of all terms of the offer, whether material or
immaterial, major or minor.
 If the parties are not ad idem on all matters
concerning the offer and acceptance, there is
no contract.
 Examples:
 a) ‘A’ made an offer to ‘B’ to purchase a house
with possession from 25th July. The offer was
followed by an acceptance suggesting possession
from 1st August. Held, there was no contract. [
Rutledge Vs .Grant (1828)]

9.  it must conform with the offer.
 Examples:
 M offered to sell a piece of land to N at
500,000
 N accepted and enclosed 100000 with a
promise to pay the balance by monthly
installments of 50000 each.
 Held, there was no contract between M
and N, as the acceptance was not
unqualified.

10.  2.It must be communicated to the offeror
 To conclude a contract between the parties, the acceptance
must be communicated in some perceptible form. Section 3 of
Act
 Mere acceptance without communication is not binding. 2008
CLD 356 LAHORE-HIGH-COURT-LAHORE
 Bidding succeeded but was to be finally approved from
Privatization board. Meanwhile litigation started and bidding
approval not communicated, held no contract. A mere resolve or
mental determination on the part of the offeree to accept an
offer, when there is no external manifestation of the intention to
do so, is not sufficient. [ BhagwandasKedia Vs. Giridharilal
(1966)]
 a) ‘A’ tells ‘B’ that, he intends to marry ‘C’. But tells ‘C’
‘nothing of his intention. There is no contract even if ‘C’ is
willing to marry ‘A’.
 b) A draft agreement relating to supply of coal was sent to
the manager of a railway company for his acceptance. The
manager wrote the word “approved” and put the draft in the
drawer .
 Held, there was no contract. [Brogden Vs. Metropolitan Rail

11.  3.It must be according to the mode prescribed or
usual and reasonable mode.
 The communication must be according to the mode prescribed [
Sec.7(2)]
 • Eg. If the Offeror has sought the communication of acceptance
from offeree by telephone, it cannot be given by post.
 • In case, the acceptance is made in a manner other than the
mode prescribed but the offeror does not raise any objection
within a reasonable time, the acceptance will be binding.
 4. It must be given within a reasonable time
 The acceptance to an offer must be given within a reasonable
time. If it is not given within a reasonable time, the offer lapses.
 In Ramsgate Victoria Hotel Ltd. Vs. Montefiore(1886)
 M applied for the shares of R Co on 8th June. But the
Company did not intimate about allotment until November. M
refused to take shares. Held, the offer was lapsed by
unreasonable delay.

12.  5.It cannot precede an offer.
 In a company shares were allotted to a person
who had not applied for them.
 Subsequently when he applied for shares , he
was unaware of the previous allotment.
 The allotment of shares previous to application
is invalid.
 6.It must show an intention on the part of
the acceptor
 to fulfill terms of the promise.
 If no such intention is present, the acceptance
is invalid.
 Where intention in expressed in words of an
agreement, it is sufficient.

13.  7.Must be given by the party or parties to whom
the offer is made.
 A bought a business from B
 Meanwhile C to whom B owed a debt, placed an
order with B for the supply of certain goods.
 A supplied the goods even though the order was
not addressed to him.
 C refused to pay A for the goods because he, by
entering in to contract with B, intended to set off his
debt against B.
 • Held, the offer was made to B and it was not in
the power of A to step in accept and therefore there
was no contract .
 [Boulton Vs. Jones(1857)].
 8.It must be given before the offer lapses or before
the offer is withdrawn.

14.  9.It cannot be implied from silence
 • The acceptance of an offer cannot be
implied from the silence of the offereeor his
failure to answer, unless the offereehas by
his previous conduct indicated that his
silence means that he accepts.
 A wrote to B., I offer you my car for
Rs.10,000.
 If I don’t hear from you in seven days , I
shall assume that you accept”.
 B did not reply at all. There is no contract.

15. Communication
 In telephonic and face to face
communication, offer and acceptance is
instant and no problem arises as to
completeness of communication of offer
and acceptance. However, while using
other medium of communication, for
example, post or courier
 Communication When completed? When
the proposal comes to the knowledge Of
the person for whom It is made.

16. COMMUNICATION OF
OFFER
 The communication of proposal is
complete when it comes to the
knowledge of the person to whom it is
made.

17. COMMUNICATION OF
ACCEPTANCE
 An acceptance to be valid and legally binding, it must be
communicated to the offeror. According to Section 2(b) When
a person to whom the proposal is made, signifies his assent
thereto, the proposal is said to be accepted. A proposal, when
a accepted, becomes a promise. It means that the offeree
must signify his assent, or communicate the acceptance.
 against Proposer: when it is put in course of transmission to him, so as
to be out of power of the acceptor Againstt Acceptor: when it comes to
the knowledge of proposer.
 Communication of Acceptance by an Act:This would include
communication via words, whether oral or written. So this will include
communication via telephone calls, letters, e-mails, telegraphs, etc.
 Communication of Acceptance by Conduct: The offeree can also
convey his acceptance of the offer through some action of his, or by his
conduct. So say when you board a bus, you are accepting to pay the
bus fare via your conduct.

18.  As against the Offeror: For the proposer, the
communication of the acceptance is complete
when he puts such acceptance in the course of
transmission. After this it is out of his hand to
revoke such acceptance, so his communication
will be completed then. So, for example, A
accepts the offer of B via a letter. He posts the
letter on 10th July and the letter reaches B on
14th For B (the proposer) the communication of
the acceptance is completed on 10th July itself.
 As against the Acceptor: The communication
in case of the acceptor is complete when the
proposer acquires knowledge of such
acceptance. So in the above example, A’s
communication will be complete on 14th July,
when B learns of the acceptance.

19. COMMUNICATION OF
REVOCATION
 Against Sender: when it is put in course
of transmission to the other person, so
as to be out of power of the Sender
Againstt Receiver: when it comes to his
knowledge.

20. Type of communication When
communication is complete
 Acceptance (against the offeror) Date of
posting a proper acceptance letter
 Acceptance (against the offeree) Date of
receiving the acceptance letter
 All other communication Date of
receiving the letter

21. PAKISTAN STEEL PRODUCTS VS INDUS STEEL PIPES LIMITED
1996 C L C- Karachi High Court Sindh- 118.
 Plaintiff (Pakistan Steel products) participated in the tenders to
purchase steel pipes lying in the factory of defendant (Indus
Steel pipes limited) at the Kotri. At the rate of 7555 per metric
ton.
 The plaintiff paid a sum of 5 Lac, as earnest money.
 The Plaintiff’s bid was found to be highest but the Defendant initiated
further negotiations with the Plaintiff to raise price, which the
Plaintiff approved through letter to raise price up to 8000 per metric
ton.
 After three days the Plaintiff revoked it’s acceptance through another
letter, and stated that he will contract on the previous rate 7555.
 The Defendant, after receiving both the letters issued a letter to the
Plaintiff claiming forfeiting of the earnest money as a security
measure to ensure completion of contract and stated to the Plaintiff
to complete the contract, otherwise the earnest money will be
forfeited.

22. Court Held;
 The Plaintiff’s first offer was never
accepted initially by the Defendant, rather
the Defendant initiated further negotiations
for raise in price.
 The Plaintiff revoked its acceptance before
completion of the communication of the
acceptance.
 Hence, there was no contract so there is
no breach of contract.
 The forfeiting of amount was unlawful and
the Plaintiff is entitled to refund the amount
along with the profit.

23. DR. AZEEM SHAD VS MUNICIPAL COMMITTEE,
MULTAN
P L D 1968 Lahore –High-Court, 1419.
 A Municipal Committee (Defendant) invited
tenders for leasing out certain premises.
 The Chairman allegedly accepted the offer
of the Plaintiff being the highest offer and
passed orders on the file for delivery of
possession to him. Such acceptance,
however, was not communicated by the
Municipal Committee to the plaintiff and
was subsequently revoked.

24.  The plaintiff, since he was not delivered
possession of the premises, filed a suit
against the Committee claiming
damages in the sum of Rs. 5,000.00.
 The suit was resisted by the defendant
on the ground that there was no valid
contract between the parties which
could give rise to a cause of action for
damages.

25. Court Held;
 There was no valid contract and dismissed the
appeal in limine.
 Although the offer of the appellant was accepted by
the chairman, it was admittedly not communicated to
him, a mere accepting without communicating the
same cannot be binding.
 However, even if the acceptance had been
communicated to the plaintiff, there would have been
no valid contract between the plaintiff and the
Municipal Committee in the absence of an
agreement in writing, under the seal of the Municipal
Committee.
 It is provided in rule 5 p f the West Pakistan
Municipal Committees (Contract) Rules, 1960, as
follows:---

26.  "5. Manner of making contracts. n(1) A
formal deed of agreement shall be
executed between the Municipal
Committee and the contractor, for every
Contract.
 However, the obiter dicta of the case
was that in the public interest it is
necessary that after the officers acting
on behalf of the local Bodies have
reached an agreement, they should
contemporaneously draw up the
agreement, execute it in accordance
with the relevant provisions of law.

27. Government of the Punjab VS Abdul Karim
1983 C L C, Lahore High Court, 828.
 It was a first appeal by the Defendant (Government
of the Punjab) from the judgment and decree of civil
judge, 1st class.
 The Plaintiff (Abdul Karim) stated that the Defendant
had some unserviceable stores, which they wanted
to dispose of so they held auction, but the highest
bid thereto was not acceptable to the Defendant.
 The defendant then invited quotations, the Plaintiff
offered more than the highest bid, the Plaintiff
claimed that the Defendant accepted the offer and
called upon him to deposit 40,620 by way of earnest
money, this was duly done within the period specified
by the defendants. Thus a binding contract came into
existence between the parties.

28.  The defendant resisted the suit on the grounds
that the stores could only be sold if they were
declared surplus by the competent authority.
 In this particular case the competent authority
had not made any such declaration.
 Apart from that the competent authority had
not accepted the offer of the plaintiff and as
such no contract for the sale of the stores had
come into existence between the parties. It
was also stated that the stores had since been
utilized by the defendants in connection with
some public works and were as such no
longer available.

29. Court Held;
 There was no agreement between the plaintiff and the
defendants for the sale of the stores in question.
 In support of their assertion that a binding contract of
sale of stores had come into existence between the
parties the plaintiff relied upon three documents in
addition to the oral testimony of four witnesses
including the plaintiff.
 we are unable to treat the letter of the Executive
Engineer addressed to the plaintiff or the
communication sent by the Superintending Engineer
to the Executive Engineer as equivalent to the
acceptance of the offer made by the plaintiff.