Postal Rule of Acceptance

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THE POSTAL RULE OF ACCEPTANCE This essay will be discussing the postal rule of acceptance that will include the reasons for the creation of the rule and its continued application till today with its significance. It will also state whether the Electronic Transactions Act 1999 (Cth) or the Electronics Transactions Act 2000 (Vic) has any impact on the postal rule of acceptance. In order for a contract to be binding, there must be an invitation to traet, an offer followed by an acceptance and then a consideration. And to prove if the contract had existed or not between the two parties there must be an intention to be bound as well. Acceptance has to occur within the boundaries of the general rule. The general rule is that acceptance is not effective, and the contract is not formed, until and unless the acceptance is communicated to the offeror. However, any rule has exceptions to suit certain unusual circumstances and cases. The general rule also has certain exceptional cases. One of the famous one is the postal rule of acceptance. In this rule, acceptance takes place when the letter is posted. To be specific, postal acceptance is only done when the letter is properly posted at the Post Office or one of the employees authorized to receive letters. On the other hand, it is very important to note that handing a letter to the postman authorized to deliver letters is not posting.1 There are various reasons for this rule to come in existence. One is that the offeror must be considered as making the offer all the time that his offer is in the post, and that therefore the agreement between the parties is complete as soon as the acceptance is posted. The case of Henthorn v Fraser [1892] 2 Ch.27, 33; as Lord Herschell said that the only restriction on the application of the postal rule is that: “the circumstances [must be] such that it must have been within
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