Overview
This lecture focuses on the concept of acceptance in contract law, specifically the rules and principles governing acceptance as the second component of contract agreement.
Recap: Elements of Contract Formation
- The formation of a contract requires agreement, consideration, intention to create legal relations, and sometimes formalities such as writing.
- Agreement is made up of an offer and acceptance.
- Previous lessons covered offers, including distinguishing offers from invitations to treat and types of offers.
Acceptance of an Offer
- Acceptance is the other side of agreement, requiring matching assent to the offer's terms.
- The "mirror rule" states acceptance must exactly match the terms of the offer.
- The objective approach is used for both identifying offers and acceptances; it considers what a reasonable person would interpret as acceptance.
- Conduct, not just verbal or written communication, can constitute valid acceptance.
Case Study: Brogden v. Metropolitan Railway (1877)
- Defendants supplied coal to the claimants without a formal signed contract, acting on a draft contract for two years.
- When the suppliers stopped, claimants sued for breach of contract, though no contract was formally signed.
- The court held acceptance was shown by the defendants' conduct (performing the contract terms), creating a binding contract.
- Acting in accordance with a draft contract's terms can establish contractual acceptance even without formal signing.
Key Terms & Definitions
- Offer — A proposal by one party to form a contract, which if accepted, creates a binding agreement.
- Acceptance — Unqualified agreement to the terms of an offer, forming an agreement.
- Mirror Rule — The rule that acceptance must exactly match the terms of the offer.
- Objective Approach — Assessing contract formation based on what a reasonable person would believe.
- Conduct — Actions that demonstrate agreement to contract terms, which can constitute acceptance.
Action Items / Next Steps
- Review the concept and application of the mirror rule.
- Read about the importance of conduct in contract acceptance.
- Prepare to discuss additional aspects of acceptance in future lessons.