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The Defendants, wool dealers, sent a letter to Plaintiffs, wool manufactures, offering to sell them fleeces, upon receipt of their acceptance in the course of post.
Synopsis of Rule of Law.
This is the landmark case from which the mailbox rule is derived. The mailbox rule stands for the proposition that an offer is accepted upon mailing of the offer.
Facts.
Defendants mailed their offer to sell on the 2nd of September, 1817. The Defendants’ letter was misdirected and did not reach the plaintiffs until 7:00 p.m., Friday the 5th. That night, Plaintiffs accepted Defendant’s offer, and mailed it directly back in a timely manner. It was received by Defendant on the 9th, but they expected to receive it on the 7th and, in the meanwhile, had offered and sold their wool to another person. Plaintiffs brought suit for the losses they sustained by not receiving the fleeces.
Issue.
This case considers when mutual assent to an agreement occurs in the particular circumstance of a mail contract.
Held.
The Court of King’s Bench upheld the rule of the trial court that, when forming contracts by mail, acceptance is valid from the time of mailing a letter containing language of same. Because Defendants, in their offer, notified the Plaintiffs of their terms, that they would await acceptance in the course of post, they were bound by the terms of their offer until it was accepted or until the terms of the offer had expired. Plaintiffs accepted within the course of post, by mailing same, and therefore manifested a valid asset.
Discussion.
It is important to remember that the mailbox rule is a default rule, meaning that parties to a contract can opt out of using this rule by the terms of their agreement. When offers are made via mail, acceptance is complete upon mailing. However, be careful to note what the terms of the offer are.
