The issue in the given situation is whether Mr. Robert’s revocation of offer is effective as against Mr. James.
Section 2(h) of the Contracts Act 1950 defines contract as an agreement enforceable by law. In order for an agreement to be enforceable by law, it must consist of six essential elements which are offer, acceptance, consideration, intention to create legal relations, capacity and certainty. Offer is defined in Section 2(a) of the Contracts Act as something which is capable of being converted into an agreement by its acceptance. According to section 5(1) ...view middle of the document...
However, if the revocation of offer is made by post, the revocation is only effective when it comes to the knowledge of the person to whom it is made and not at the time when the letter of revocation is posted.
In the case of Byrne v. Van Tienhoven, the defendant posted a letter of offer to the plaintiff on 1st October. The plaintiff received the letter on 11th October and accepted the offer on the same day by telegram. On 8th October a second letter had been sent from the defendant revoking the offer, this was received by the plaintiff on 20th October. It was held by the court that the defendant’s revocation was not effective until it was received on 20th October. This was too late as a contract was already formed between the two parties when the plaintiff accepted the offer through the telegram.
Hence, even though Mr. Robert posted the revocation letter before Mr James accepted the offer, Mr. Robert’s revocation of the offer remained ineffective until it was received by Mr. James on 20 July 2012. By the time Mr. James received Mr. Robert’s letter of revocation, Mr. James had already accepted the offer and a contract was formed immediately upon posting the acceptance letter on 14 July 2012.
In conclusion, Mr. Robert’s revocation of offer is ineffective as against Mr. James.