Updated: Jun 29, 2020
Court: Court of Appeal
Judge in sitting: Lord Herschel
Henthorn v Fraser  2 Ch. (27) is a decision of the Court of Appeal of England and Wales. It deals with the reference of postal rule of English Law of Contract formation. The case is based on a line of judgement of Adams vs Lindsell (1818). This case talks about the acceptance being valid during the time of posting. The importance of this decision's ratio is that a postal acceptance will only be valid at the time of posting if it's reasonable for the offeror to expect an acceptance by post. The fact that both parties were living in different towns justifies that they had discussed the mode of communication has to be letter sent by post.
This case considers the difficulty of acceptance of contract and whether or not revocation of offer sent by post was in a suitable manner to revoke an offer, despite the fact that the offer was unknowingly already been accepted by post. In this case a man had been given an offer to purchase a property but the next day a letter was sent to him that the offer was revoked, however before the man received the letter of withdrawal, he had posted a letter accepting the original offer. The party who were offered for sale argued that they had revoked the offer and therefore any acceptance of original offer won’t be taken into consideration.
The complainant and the defendant were situated at Liverpool and Birkenhead respectively. They had been negotiating the purchase price of houses. An original offer to buy the houses for £600 had been rejected. The defendant, Mr Fraser, handed the complainant, Mr Henthorn, a note that detailed an option to sell the property for £750, which would be valid for 14 days. While this offer was being considered, another buyer was interested and the defendant concluded a contract with them instead. The next day, the defendant then withdrew the offer to the complainant by post. This note did not reach Mr Henthorn until 5pm. In this time, Mr Henthorn had already responded to the offer by post with an unconditional acceptance to buy the houses for £750. But, this was not delivered to Mr Fraser until the office was closed and he did not read this acceptance until the morning. Before that letter was received, the defendant had, through his solicitor written back to simply accept the first offer. The plaintiff sought specific performance. Two important points to be kept in mind are: • An offer was sent by post requesting acceptance within 14 days. • The offer was revoked before postal acceptance was received, however the acceptance had already been posted.
The issue in this case concerned the revocation of the offer. This was completed before the postal acceptance of the offer was received. It was for the court to decide whether the acceptance of the offer was valid or if the contract had been revoked successfully before the acceptance.
The court held that the offer was valid and an order for specific performance made for £750 to get the property. The postal decree Adam v Lindsell would apply, which stated that it might be reasonable for acceptance of an offer to take place by post. Lord Herschell argued that “However, this rule would not apply to the revocation of an offer, Post was a way of communicating offer acceptance, but the acceptance itself is completed as soon as it is posted”. This was reasonable to expect since both parties lived in different towns.
According to me the judgement passed is absolutely right. As per the judgement passed, it says that the offer is valid whereas the revocation passed is invalid. This statement can’t be objected as Mr Henthron had already responded to the offer by post of unconditional acceptance to buy the house but it wasn’t delivered to Mr Fraser until the office was closed and he didn’t not read acceptance until morning and then Mr Fraser had through his solicitor written back to accept the first offer and so basically the revocation won’t be taken into consideration as even after Mr Fraser had sent a letter of revocation but he again accepted the reply of Mr Henthron.