A contract is defined as an agreement that is enforceable by law. The key elements of a valid contract are an offer, acceptance of that offer, lawful consideration, lawful object, and mutual consent between competent parties. Not all agreements are considered contracts - an agreement must meet additional requirements of enforceability and intention to create legal obligations to be a valid contract. Common types of agreements discussed include valid contracts, void agreements, voidable agreements, and invitations to treat which are not considered offers. Key aspects of forming a valid contract center around offer, acceptance, and consideration.

1. What is contract?
By
Dr. Sridevi Krishna
Assistant Professor
Vidyavardhaka Law College
Mysore

2. Definition
• Section 2(h) of the Indian Contract Act, 1872
defines
• “a contract is an agreement enforceable by law.”
• Section 2(e) defines agreement as “every promise
and every set of promises forming
• consideration for each other.”
• The two elements of an agreement are:
• (i) offer or a proposal; and
• (ii) an acceptance of that offer or proposal.

3. Definition continued..
• Section 2(b) defines promise in these words:
“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.”

4. What agreements are contracts?
• Only those agreements which are enforceable at
law are contracts. The Contract Act is the law of
those agreements which create obligations, and
in case of a breach of a promise by one party to
the agreement, the other has a legal remedy.
• Thus, a contract consists of two elements:
• (i) an agreement; and
• (ii) legal obligation, i.e., it should be enforceable
at law.

5. Continued..
• There are certain agreement which do not
give rise to contractual obligation.
• A invites B for dinner in a restaurant. B
accepts the invitation. On the appointed day,
B goes to the restaurant. To his utter surprise
A is not there. Or A is there but refuses to
entertain B. whether B has a remedy?

6. Continued..
• Here the promise is not enforceable at law as
there was no intention to create legal
obligations. Such agreements are social
agreements which do not give rise to legal
consequences.
• This shows that an agreement is a broader
term than a contract. And, therefore, a
contract is an agreement but an agreement is
not necessarily a contract

7. Continued..
• An agreement of a purely social or domestic nature is
not a contract.
• Balfour v. Balfour
• the defendant who was employed on a govt job in
Ceylon, went to England with his wife on leave. For
health reasons the wife could not accompany
husband again to Ceylon. The husband promised to
pay 30 pounds per month to his wife as maintenance
for the period she had to live apart. The husband
failed to pay this amount and wife sued him.
• Held: there being no intention to create legal
relationship, the husband was not liable.

8. Jones V Padavatton
• Mrs Jones lived in Trinidad. Her daughter, who had been divorced
and had young son, lived in Washington and was serving Indian
embassy there. Mrs Jones persuaded her daughter to leave the job
and study for the bar in England to become a barrister. Mrs. Jones
offered to pay her daughter a monthly allowance during her studies
for the bar in England. The daughter reluctantly agreed to the
suggestion, left the job and went to England. In 1964,Mrs Jones
brought a house in England. The daughter was allowed to stay in a
part of the house where the other part was let out. The rent
received from the part of the house was given to the daughter to
cover her expenses. In 1967, some differences arose between the
daughter and mother. Mrs Jones bought an action to evict her. Till
that time the daughter had not completed her studies for the bar.
• Held: the mother succeeded as there was no intention to create
legal relationship.

9. Meritt V Meritt
• The husband and wife were joint owners of a
building which was subject to mortgage to a building
society. The husband left matrimonial home to live
with another women. At that time, at the instance of
the wife, the husband signed a note saying that wife
will pay all the outstanding amount in respect of the
house and in return he will agree to transfer the
property into sole ownership of the wife.
• Held: it was clear that the parties intended to create
legal relationship and therefore, the husband was
bound by the contract.

10. What obligations are contractual in nature?
• Law of contracts is not the whole
law of agreements. Similarly, all
legal obligations are not
contractual in nature. A legal
obligation having its source in an
agreement only will give rise to a
contract.

11. Continued..
• Law of Contracts creates rights in personam as
distinguished from rights in rem.
• Right in personam- available against a person
only.
• Right in Rem- available against whole world

12. Continued..
• A agrees to sell his motor bicycle to B for Rs. 5,000. The
agreement gives rise to a legal obligation on the part of
A to deliver the motor bicycle to B and on the part of B
to pay Rs. 5,000 to A. The agreement is a contract.
• If A does not deliver the motor bicycle, then B can go
to a court of law and file a suit against A for non-
performance of the promise on the part of A.
• On the other hand, if A has already given the delivery
of the motor bicycle and B refuses to make the
payment of price, A can go to the court of law and file
a suit against B for non-performance of promise.

13. Essential elements of a valid contract
• Section 10: of the Act provides some elements
which are essential in order to constitute a
valid contract. It reads as follows:
• “All agreements are contracts if they are made
by free consent of parties, competent to
contract, for a lawful consideration and with a
lawful object and are not hereby expressly
declared to be void.”

14. Elements
• There must be two persons.
• It must be made by persons who are
competent to contract.
• There must be free consent.
• There must be lawful object and lawful
consideration.
• The agreement must not be one which is
expressly declared as void by law.

15. Continued..
• The contract must be between two competent
parties.
• They must have attained the age of majority
according to Indian Majority Act.
• An agreement is the result of a proposal or an
offer by one party followed by its acceptance
by the other.

16. Kinds of agreement
• From the point of legality there are different
types of agreement.
• 1) Void agreements
• Section 2(g)- an agreement not enforceable
by law is said to be void.
• Ex: agreement with a minor- void ab initio
• Agreement without consideration
• Agreement in restraint of marriage, trade etc,.

17. Voidable Agreements/contracts
• Section 2(i) an agreement which is
enforceable at the option of one or more of
the parties thereto, but not at the option of
the other, is voidable contract.
• Ex: when the consent of the party is obtained
by coercion, fraud, undue influence,
misrepresentation it is voidable.

18. Illegal agreement
• Agreements forbidden by law is illegal
agreements.
• Ex: agreement to commit crime

19. Offer & Acceptance
• Section 2(a)- Offer- when one person signifies
to another his willingness to do or abstain
from doing anything, with a view to obtaining
the assent of that other to such act or
abstinence, he is said to make a proposal.
• One who makes an offer is offeror
• To whom it is made he is called offeree
• The term proposal used in Indian Contract Act
is synonym to Offer used in English Law.

20. Offer & invitation to treat
• Books catalogue
• Auction sale
• Submission of tender
• Display of items in a super market
• Display of medicines in a medical store.

21. Hariss V Nickerson
• The defendant advertised a sale by auction.
The plaintiff travelled to the advertised place
of auction to find that the defendant had
cancelled the auction sale. he brought an
action against the defendant to recover the
expenses of his travel.
• Held: defendant was not liable to the same as
there was no contract between the parties.

22. Pharmaceutical Society of Great Britain V Boots Cash Chemicals Ltd
• The defendants were having the business of retail sale of
drugs. Medicines were displayed on the shelves and the price
were also indicated. They had self service system.
• On entry into the shop the customers were given a basket.
After selecting the articles by the customer he could put them
in the basket and taken them to the cash desk. The
defendants had put a registered pharmacist near the cash
counter, who had been authorized to stop any customer
removing any drug from the premises.
• Held: the display of articles on self service basis was not offer
but mere invitation to treat.
• When a customer selects some articles and takes them to
cash counter it amounts to offer made by customer which
may be or may not be accepted at the cash counter.

23. • Whether quoting of price amounts to
offer?

24. Quoting of price
• Harver V Facey
The defendants in this case were the owners of plot of land
known as bumper hall pen. The plaintiff were interested to buy
the land, sent a telegram to the defendants writing “ will you sell
us bumper hall pen? Telegraph us the lowest price”
The defendants in replay wrote: “ the lowest price of bumper
hall pen is 900 pounds”.
The plaintiff sent another telegram to the defendants saying “
we agree to buy Bumper hall pen for 900 pounds asked by you.
Please send us title deeds”.
The defendants refused to sell the land. Plaintiff brought an
action against the defendants.
Held: quoting of price does not become an offer. The
defendants had not accepted the offer made by plaintiff. So
there is no binding contract.

25. Communication of offer
• Section 2(a) Offer- specifies that a person is
said to make a proposal when he signifies to
another person his willingness to do or abstain
from doing something.
• Section 3- offer may be communicated by the
offeror by any act or omission by which the
offeror-
• Intends to communicate the offer or
• Which has the effect of communicating the
offer.

26. Express offer & implied offer
• Section 9- when proposal or acceptance is
made through words it is express offer.
• When proposal or acceptance is made
otherwise than in words, it is said to be
implied.

27. Communication of offer
• Section 4- the communication of offer is complete when it
comes to the knowledge of the person to whom its made.
• Lalman Shukla V Gauri Dutt
• The defendant’s nephew absconded from home. The
plaintiff, who was his servant was sent to search for the
missing boy. After the plaintiff left to search the boy.
Defendants announced a reward of 501 rs to be given to
anyone who found the missing boy. The plaintiff who was
ignorant of this reward was successful in searching the boy.
When he came to know about the reward announced in his
absence he filed a suit against the defendant claiming the
same.
• Held: plaintiff cannot claim the reward because he was
ignorant about the reward and his act of brining the boy did
not amount to the acceptance.

28. Kinds of offer
• Cross offer
• Specific and General offer
• Standing , open or Continuing offer
• Counter offer

29. Cross offer
• When the offers made by two persons to each
other contains similar terms of bargain cross each
other in post, they are known as cross offer.
• Ex- On 1st Jan A offered to sell his bike to B for Rs
80,000 through a letter sent by post. On the same
date B wrote to A making an offer to purchase A’s
bike for Rs 80,000/-. When A & B sent their
letters, they did not know about the offer which
was being made by the other side. Even though
the parties intended the same bargain, there
would be no contract. Contract would arise only if
either A or B had knowledge of the offer and had
accepted the same.

30. Tinn V Hoffmann
• Defendant wrote to plaintiff indicating his willingness
to sell 800 tonnes of iron at 69 Sh.per ton. On the same
day Plaintiff also wrote to Defendant offering to buy
800 tons of iron at 69 sh.per ton. The two letters
crossed each other in post. Plaintiff brought an action
against the defendant for not supplying the iron
contending that a valid contract had been created
between the two parties.
• Held: there were only two cross offers present which
neither party has accepted. Thus there is no contract.

31. Specific & General offer
• When an offer is made to a specific or
ascertained person, it is known as a specific
offer.
• When it is made to the public at large it is
general offer.
• It is completed when anybody acts on the
offer.

32. Carlill V Carbolic Smoke Ball Co
• The defendants advertised their product Carbolic Smoke
Ball, a preventive remedy against influenza. In the add they
offered to pay a sum of 100 pounds as reward to anyone
who contacted influenza, cold or any disease caused by
cold after having used the smoke ball three times a day for
two weeks. They also announced that 100 pounds has been
deposited with Alliance Bank to prove show their sincerity.
The plaintiff relying on the add purchased the smoke ball
and consumed it as per the printed direction. In spite of it
she contacted influenza. She filed a suit against the
company claiming the 100 pounds.
• Held: since it was a general offer it has ripened into a
contract when the plaintiff acted upon it. She was therefore
entitled to claim the reward.

33. Standing, open or continuing offer
• An offer which is allowed to remain open for
acceptance for a period of time is known as
standing, open or continuing offer.
• Ex- an offer to supply 1000 bags of wheat
from 1st Jan to 31st Dec, in accordance with
the orders which may be placed from time to
time is standing offer.

34. Homee Wadia & Co V Bengal Coal Co
• The Bengal Coal co agreed to supply coal to the H W &
co up to a certain quantity at an agreed price for a
period of 12months, as may be required by them from
time to time. HW placed orders for the supply of some
coal and the same was complied with.before the expiry
of said period of 12 months, Bengal Co withdrew their
offer to supply coal further and refused to comply with
further orders placed thereafter. They were sued for
breach of contract.
• Held: there was no contract between the parties and
there could be no liability for breach of contract. There
was simply a continuing offer to supply coal. They were
free to revoke their offer in this case.

35. Rajendra Kumar Verma V State of M.P
• The respondents invited tenders for the sale of Tendu leaves. The
petitioner submitted his tender and also deposited some security.
The tender was to be opened on 9th April 1969. Before the due date
the petitioner made an application withdrawing his tender and
requested that on the stipulated date the tender be not opened. In
spite of his request the tender was opened, and that being the only
tender the same was accepted. The petitioner refused to execute
the agreement of purchase of leaves. The Govt sold the leaves to
somebody else and then sued the petitioners claiming the loss of rs
25,000/-.one of the contention of respondents was there was a
clause In the tender notice where the petitioner having submitted
his tender was not entitled to withdraw the same.
• Held: in spite of such clause in the tender notice, the tender or any
offer can be withdrawn and since the offer has been withdrawn no
contract has arisen between the parties and petitioners are not
liable

36. Counter Offer
• When an acceptance of an offer contemplates
future negotiations for finalization of the
terms of the contract it is counter offer.
• Ex if I make an offer to sell my watch to you
for Rs 500 and you are willing to pay only Rs
400 for the same. There is no contract but
only a counter offer made by you.

37. Acceptance
• The Indian Contract Act, 1872 defines an
acceptance as follows:
• Section 2(b) ‘‘When the person to whom the
proposal is made signifies his assent thereto,
the proposal is said to be accepted” .
• Thus, acceptance is the act of giving consent
to the proposal. A proposal when accepted
becomes a contract.

38. Acceptance How Made?
• The offeree is deemed to have given his
acceptance when he gives his assent to the
proposal.
• The assent may be express or implied.
• It is express when the acceptance has been
signified either in writing, or by word of mouth,
or by performance of some required act.
• Acceptance can also be made by performing the
required act.
• Acceptance is implied when it is to be gathered
from the surrounding circumstances or the
conduct of the parties.

39. Who can Accept?
• In the case of a specific offer, it can be
accepted only by that person to whom it is
made.
• The rule of law is that if A wants to enter into
a contract with B, then C cannot substitute
himself for B without A’s consent

40. ESSENTIALS OF A VALID ACCEPTANCE
• 1. Acceptance must be communicated by
offeree to the offeror
• The communication of acceptance may be
express or implied.
• A mere mental acceptance is no acceptance.
• A mere mental acceptance means that the
offeree is assenting to an offer in his mind
only and has not communicated it to the
offeror.

41. Felthouse V Bindley
• Felthouse offered by letter to buy his nephew’s
horse for £30, saying: “If I hear no more about it,
I shall consider the horse is mine at £30.”
• The nephew did not reply at all, but he told an
auctioneer who was selling his horses not to sell
that particular horse as he had reserve it to his
uncle. By mistake, the auctioneer(Bindley) sold
the horse. Felthouse sued the auctioneer for
conversion.
• Held: Felthouse could not succeed as his nephew
had not communicated acceptance and there was
no contract.

42. Communication must be made by the offeree or his authorized agent.
• Powell V Lee
• Powell was one of the candidates for the post of
head master of a school. The board of Managers
passed a resolution selecting him for the post. No
communication about this decision was made to
Powell by the Board. One of the members of the
board who had not been authorized to
communicate this decision, acting in his
individual capacity informed Powell about his
selection for the post. Subsequently, the board of
managers met again and decided to cancel the
appointment of powell and appointed another
candidate Parker in his place. Powell sued Lee the
chairman of the board for breach of contract.

43. Continued..
• Held: since the resolution passed by the board
was not communicated to Powell by the
board, or any authorized person on its behalf,
it could not give rise to a contract. Powell’s
action therefore, failed.

44. Continued..
• Section 8 – Performance of the conditions of a
proposal is an acceptance of the proposal.
• Carill V Carbolic Smoke Ball Co case.

45. Acceptance by Post/Telegram
• Section 4 – The communication of acceptance is
complete as against the proposer, when it is put in
the course of transmission to him so as to be out of
power of the accepter.
• The communication of acceptance is complete as
against the acceptor, when it comes to the
knowledge of the proposer.
• B accepts A’s proposal by a letter sent by post. The
communication of the acceptance is complete-
• As against A , when the letter is posted,
• As against B, when the letter is received by A.

46. Dunlop V Higgins
• Dunlop & Co offered to sell 200 tons of iron pigs at 65
sh per ton to Higgons & Co through their letters dated
22nd and 28th Jan, 1945. Higgns & Co received the
letters on 30th Jan & replied the same day, indicating
their acceptance to purchase the iron pigs in
accordance with the offer. Due to frosty weather there
was disruption in the train services and the letter of
acceptance instead of reaching on 31st Jan reached
Dunlop & Co on 1st Feb. Dunlop & co refused to supply
iron pigs on the ground that the receipt of the letter of
acceptance by them had been delayed.
• Held- Dunlop & co had become bound by the contract
as soon, as the letter of acceptance was posted to
them, i.e on 30 th Jan 1945.

47. Acceptance by Telephone
• In case of telephonic conversation the position was the same as in
the case where the parties were in the presence of each other
• Bhagwandas V Giridhar Lal & Co. the plaintiffs made an offer on
phone from Ahmedabad for the purchase of cotton seed cake from
the defendants. The defendants accepted this offer on phone at
Khamgaon. The defendants having failed to supply the cake were
sued by the plaintiffs to pay compensation amounting to Rs.31,150
for the breach of contract. The suit was filed at Ahmedabad. The
defendants contended that the Ahmedabad court had no
jurisdiction because the contract was completed by the acceptance
of offer on telephone, at Khamgaon. On the other hand, plaintiff
pleaded that the contract wasstruck when he heard acceptance at
Ahmedabad.
• Held: contract was made at Ahmedabad where the acceptance was
communicated and the part of cause of action for an action for
breach had arisen within the jurisdiction of Ahmedabad court.

48. 2. Acceptance should be absolute & unqualified
• An acceptance to be valid must be absolute and unqualified
and according to the exact terms of the offer. An acceptance
with a variation, however slight, is no acceptance, and may
amount to a mere counter offer which the original offeror
may or may not accept.
• A offers to sell his house to B for Rs. 1,000. B replies, “I can
pay Rs. 800 for it.” The offer of A is rejected by B as the
acceptance is not unqualified. However, B subsequently
changes his mind and is prepared to pay Rs. 1,000. This will
also be treated as a counter offer and it is up to A whether to
accept the same or not

49. Hyde V Wrench
• There was an made by Defendant to Plaintiff for
the sale of a farm for 1000 pounds. Plaintiff
rejected this offer and said that he will pay only
950 pounds to which Defendant did not agree.
There upon Plaintiff said that he was willing to
pay 1000 pounds to which also Defendant did not
agree. Plaintiff sued A and contended that there
was a contract by which Defendant was bound.
• Held: Plaintiff once rejected Defendant offer by
his counter offer to pay 950 pounds and this
made the original offer to lapse, and therefore,
no contract had resulted in this case.

50. 3. Acceptance should be expressed in usual/ prescribed manner
• Section 7(2) the acceptance must be expressed in some usual
and reasonable manner, unless the proposal prescribed the
manner in which it is to be accepted.
• Prescribed Manner- State of Madhya Pradesh V Gobardhan
Dass, the Chief Conservator of forest invited from intending
buyers tenders for the sale of certain quantity of lac products.
One of the conditions of sale subject to which the tenders
were to be made, was that 25% of the purchase price was to
be deposited immediately after the close of sale viz, the
acceptance of tender. The tenders of the respondent firm was
highest and they were accepted for and on behalf of the CCF.
The respondent neither paid 25% nor paid remaining 75%.
After notice for payment of the said amount was given to
respondent, the goods were sold by CCF. Action was then
brought against the respondent firm for breach of contract
and the recovery of the loss which resulted on resale.
• Held: since respondents failed to comply with the condition
precedent to the making of the contract, there was no
contract concluded in this case and therefore no question of
breach o f contract or liability will arise.

51. 4. Acceptance should be made while offer is still subsisting
• After the offer has been withdrawn or has lapsed, there is
nothing which can be accepted. It is therefore necessary that
acceptance should be made while the offer is still subsisting.
• Acceptance after the lapse of offer cannot give rise to a valid
contract.
• Acceptance must be made within a reasonable time.

52. Revocation of offer and Acceptance
• Revocation of offer
• Section 5 – A proposal may be revoked at any
time, before the communication of its
acceptance is complete as against the
proposer, but not afterwards.
• Withdrawal of resignation
• Bids
• Tenders

53. Managing Committee SGA High School V State of Bihar & others
• A prospective resignation is an offer to quit a post and the same can be
withdrawn before the offer ids accepted by a competent authority.
• Dr. Paramanand the secretary of the managing committee of a school sent
his letter of resignation on 9/7/1980 requesting the managing committee
to accept the same. He sent another letter dt 9/8/80 with drawing his
resignation. The Managing committee, which met on 11/8/80 considered
the letter of resignation of Dr. Paramanand but ignored his subsequent
withdrawal of resignation, and decided to accept the resignation.
• Held- it was clear from the letter of resignation that the resignor intended
his resignation to be prospective in the sense that he wanted it to be
accepted by the managing committee and therefore he was free to
withdraw the same before it became effective by acceptance. It was
observed that in view of the withdrawal of the resignation, the resolution
of the managing committee accepting the resignation in its meeting held
on 11/8/80 was invalid.

54. Withdrawal of bids
• In case of sale by auction the bids made at the
auction are offers and the highest offer may
be accepted by the auctioneer. In such a case
the sale is complete when the auctioneer
announces its completion by the fall of
hammer or in any other customary way and
until such announcement is made, any bidder
may retract his bid.

55. Tenders
• Mere clause in a tender will not take away the
right of the offeror to withdraw the offer.
• Rajendra Kumar Verma V State of Madhya
Pradesh
• But if there is a contract between the parties
wherein on e of them has promised not to
withdraw his offer until a certain time, the
offer cannot be withdrawn in such a case.

56. Sharad Trading Co V State of MP
• The MP govt invited tenders from those desirous
of purchasing tendu leaves. The petitioner
submitted his tender for the purchase of leaves
for the season ending 31st dec 1973. his tender
was accepted. In the agreement a provision for
renewal of the agreement for the next season
was also there.
• It said that- government may in its discretion
renew this agreement for a further period of 1 yr
only, provided that certain conditions are
satisfied.

57. Continued..
• One of the condition was if the purchaser has to
submit application for renewal by 15th Sept 1973.
the purchaser who submitted his application for
renewal shall be bound by his offer and also by
the terms and conditions of the agreement, till
orders and also by the terms and conditions of
the agreement, till orders of the govt accepting or
rejecting his offer are passed. Further breach of
this condition shall entail forfeiture of security
deposit, make the purchaser liable to be black
listed and the purchaser will also have to pay
damages for the loss suffered by the govt.

58. Continued..
• The petitioner who was given contract for
purchase of leaves applied for renewal. However,
before the govt accepted or rejected his
application for renewal, he sent a telegram
withdrawing the application for renewal. The
govt forfeited his security deposit.
• Held: the condition in the agreement that the
application for renewal could not be withdrawn
was part of the contract for purchase of leaves
and that was duly supported by consideration
and that the petitioner was bound by that
condition I the contract.

59. Modes of revocation of offer
• Section 6 - A proposal is revoked-
• By notice of revocation given by the proposer
• By the lapse of time
• By failure of the acceptor to fulfill a condition
precedent to acceptance or
• By the death or insanity of the proposer.

60. By notice of revocation
• Before an offer is accepted it can be revoked.
• An offer may be revoked by the
communication of notice of revocation by the
proposer to the other party.
• Under English law the offer stands revoked
even though the offeree comes to know about
the revocation of the offer through some
other source and not by the offeror himself.

61. Dickinson v Dodds
• Dodds made an offer on 10th June 1874 to Dickinson for the
sale of his property for 800 pounds. It was mentioned that
the offer was open till 12th June 9 AM. On 11th June Dodds
sold the same property to somebody else. Dodds did not
himself inform Dickinson about the sale of property to
somebody else but Dickinson had come to know about this
act from some other source. On 12th June before 9:00 AM
Dickinson accepted the offer and then sued Dodds for
specific performance of the contract.
• Held- sale of property to somebody else by Dodds on 11th
June amounted to implied revocation of the offer for the
sale of the property to Dickinson and therefore , the offer
having being revoked on 11th June was incapable of being
accepted on 12th.
• Untill the offer is accepted, it creates no legal obligation.

62. By lapse of time
• A proposal is revoked by the lapse of time prescribed in
such proposal for its acceptance but if no time is
prescribed by the lapse of a reasonable time.
• Ramsgate Victoria Hotel Co V Montefiore
• The defendant made an offer to purchase shares in the
plaintiff company in June. This offer was accepted by
the plaintiff company by allotting shares to him in
November. The defendant contended that his offer has
lapsed and therefore, he was not bound to take the
shares.
• Held- the offer had lapsed as the same had not been
accepted within a reasonable time and the defendant
was not bound to buy shares.

63. By failure to fulfill a condition precedent
• When the offer is subject to some condition
precedent, such a conditions must be fulfilled
by the acceptor before making the
acceptance.
• If the acceptor fails to fulfill the condition
precedent to acceptance, the offer stands
revoked.
• State of M.P V Gobardan Dass

64. By death or insanity of the offeror
• An offer is revoked by the death or insanity of the
proposer if the fact of his death or insanity comes to
the knowledge of the acceptor before acceptance.
• In India, death or insanity of the offeror does not
automatically make the offer lapse. The offer stands
revoked if the fact of death or insanity comes to the
knowledge of the acceptor before acceptance.
• If death or insanity is not within the knowledge of
offeree while he accepts the offer, it is valid acceptance
giving rise to a contractual obligation.
• In England, if the offeree knows about the offeror’s
death, the offer lapses.

65. Revocation of Acceptance
• S 5- an acceptance may be revoked a any time
before the communication of the acceptance is
complete as against the acceptor, but not
afterwards.
• In India it can be revoked before the
communication of the acceptance is complete.
• In England, acceptance once given cannot be
revoked. As observed by Anson-
• “Acceptance is to offer what a lighted match stick
is to a train of gunpowder”