In Re Imperial Land Company of Marseilles, Ex Parte Harris
Court of Appeal in Chancery
Citations: (1872) 7 Ch App 587
The defendant sent the claimant by post an application for the allotment of shares. The claimant’s directors received the letter, and wrote back stating that they would allot the shares to him. Before the defendant received the letter, he wrote back to the company stating that he had changed his mind and did not want the shares. The claimant argued that this was too late, and that there was a completed contract for the purchase of shares.
- Was it open to the defendant to withdraw their offer for the purchase once the claimant had posted their acceptance?
The Court of Appeal held in favour of the claimant. The contract came into existence the moment the claimant posted their acceptance. It was not open to the defendant to withdraw his offer after that point.
This Case is Authority For…
An offer cannot be withdrawn once the acceptance has been validly communicated to the offeror (whether under normal rules or the postal rule).
This case represents an application of the postal rule: that an acceptance sent by post is validly communicated the moment it is posted.