Case Of Entored Ltd V. Miles Far East Corp.
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CITY UNIVERSITY OF HONG KONG
School of Law
LW2903 Business and Law
Semester A, 2016/2017
ASSIGNMENT
Name: Wong Yin Ping
SID: 54397483
Seminar Section: CA1
Tutorial Section: TAE
Major: Accountancy
Cohort: 2015
Tutor: Vicky Lam
(1)
A contract is a legally binding agreement made between two or more parties. This case examines the contractual relationship between two parties regarding the sales and purchase of the handbag. It concerns the legal principles in the formation of contract including offer, acceptance and rejection. The first issue is whether the email sent by Amanda to Tracy on 11 April is an offer or invitation to treat. An offer is a definite promise or proposal to be bound on specific terms and it has to be definite …show more content…
The postal rule does not apply to this case since the acceptance of the offer is communicated by voicemail. The rule with regard to acceptance by such methods is that the contract is complete only when acceptance is received by Amanda. According to the case of Entored Ltd v. Miles Far East Corp(1955)2, the court held that a contract was made between the parties when the defendant’s acceptance was received by the plaintiff in London. Applying the case to the current issue, although the voicemail shown that Tracy was willing to be bound by the terms of Amanda, it was still not a valid acceptance until Amanda received it. Later on the same day, Tracy changed her mind. She posted a letter to Amanda and told her that she couldn’t sell the bag. In this letter, Tracy retracted her acceptance. The letter arrived on 14 April, before Amanda checked her voicemail. Amanda read the letter of rejection first. At this point, the voicemail of acceptance is still not valid since Amanda had no knowledge of it. The letter is considered as rejection of offer now. Since Amanda received the letter of rejection first, the letter of rejection takes the priority. Even Amanda hear the voicemail afterwards, there will be no effects to the situation. There is no contract formed between two …show more content…
The postal rules only apply to acceptance. Other contractual letters only take effect after they are delivered. According to the case of Stevenson, Jacques & Co v McLean (1880)3, the letter of revocation was inoperative before it was delivered. In this way, Tracy’s letter of rejection is invalid because Amanda does not receive and has no knowledge of it. Her voicemail of acceptance would become valid after Amanda hear it because it is well-communicated. As a result, there is an enforceable contract between Amanda and Tracy. Tracy has to sell the handbag to Amanda.
(2b) Acceptance is usually not effective until communicated by the offeree to the offeror. However, Tracy’s voicemail of acceptance was not recorded and Amanda had no knowledge of the voicemail. The acceptance was not received by Amanda. Eventually, Amanda would receive the letter of rejection from Tracy. The offer is rejected by Tracy. There is no enforceable contract between two parties. There would be no difference compared with the situation in (1).
CITY UNIVERSITY OF HONG KONG
School of Law
LW2903 Business and Law
Semester A, 2016/2017
ASSIGNMENT
Name: Wong Yin Ping
SID: 54397483
Seminar Section: CA1
Tutorial Section: TAE
Major: Accountancy
Cohort: 2015
Tutor: Vicky Lam
(1)
A contract is a legally binding agreement made between two or more parties. This case examines the contractual relationship between two parties regarding the sales and purchase of the handbag. It concerns the legal principles in the formation of contract including offer, acceptance and rejection. The first issue is whether the email sent by Amanda to Tracy on 11 April is an offer or invitation to treat. An offer is a definite promise or proposal to be bound on specific terms and it has to be definite …show more content…
The postal rule does not apply to this case since the acceptance of the offer is communicated by voicemail. The rule with regard to acceptance by such methods is that the contract is complete only when acceptance is received by Amanda. According to the case of Entored Ltd v. Miles Far East Corp(1955)2, the court held that a contract was made between the parties when the defendant’s acceptance was received by the plaintiff in London. Applying the case to the current issue, although the voicemail shown that Tracy was willing to be bound by the terms of Amanda, it was still not a valid acceptance until Amanda received it. Later on the same day, Tracy changed her mind. She posted a letter to Amanda and told her that she couldn’t sell the bag. In this letter, Tracy retracted her acceptance. The letter arrived on 14 April, before Amanda checked her voicemail. Amanda read the letter of rejection first. At this point, the voicemail of acceptance is still not valid since Amanda had no knowledge of it. The letter is considered as rejection of offer now. Since Amanda received the letter of rejection first, the letter of rejection takes the priority. Even Amanda hear the voicemail afterwards, there will be no effects to the situation. There is no contract formed between two …show more content…
The postal rules only apply to acceptance. Other contractual letters only take effect after they are delivered. According to the case of Stevenson, Jacques & Co v McLean (1880)3, the letter of revocation was inoperative before it was delivered. In this way, Tracy’s letter of rejection is invalid because Amanda does not receive and has no knowledge of it. Her voicemail of acceptance would become valid after Amanda hear it because it is well-communicated. As a result, there is an enforceable contract between Amanda and Tracy. Tracy has to sell the handbag to Amanda.
(2b) Acceptance is usually not effective until communicated by the offeree to the offeror. However, Tracy’s voicemail of acceptance was not recorded and Amanda had no knowledge of the voicemail. The acceptance was not received by Amanda. Eventually, Amanda would receive the letter of rejection from Tracy. The offer is rejected by Tracy. There is no enforceable contract between two parties. There would be no difference compared with the situation in (1).