Byrne & Co v Leon Van Tien Hoven & Co
Common Pleas Division
Citations: (1880) 5 CPD 344 (CP).
On October 1st, the defendants wrote to the claimants offering to sell goods. The defendants were in Cardiff at the time, while the claimants were in New York. The claimants received the letter on the 11th, and accepted the offer by telegram the same day. They also sent another letter confirming that they had accepted the offer on the 15th. On the 8th of October, the defendant sent a letter to the claimants purporting to withdraw the offer in their first letter. The claimants received this second letter on the 20th. The defendants denied that a contract had arisen and refused to perform.
- Had the defendants’ second letter effectively withdrawn their offer before it had been accepted?
The Court held in favour of the claimants. The second letter arrived too late to withdraw the offer. The claimants had already accepted the offer on the 11th when they sent the telegram.
This Case is Authority For…
The postal rule does not apply to attempts to withdraw offers. The offeree must actually receive the withdrawal before they have accepted the offer for the offer to be terminated.
Lindley J gave a potential justification of the postal rule in the case of acceptances. The offeror, by assenting to responses by post, implicitly makes the postal service his agent – able to receive acceptances on his behalf. This reasoning does not apply to withdrawals of offers, since the offeree has not engaged in any conduct which might make the postal service their agent.
Lindley J noted that an offer can be withdrawn at any time before it is accepted. This is the case even if the offer is stated to be open for a particular length of time.