Postal Rule And Terms Of Contract Towards Livestock

Application of Postal Rule in Forming Contracts

Question:

Discuss About The Terms Of Contract Towards Local Livestock?

The postal rule is a part of contract law which describe the terms of contract for the acceptance of an offer has communicated through any posting rules like email or phone or letter for establish a legally binding contract between the two parties. Another term under the posting rule is when an offer has been given by host or letters it will not effective until another person received the letter but as soon as it has been received and the acceptance will take place the contract effective from that moment. When the contract want to be repeat revocation therefore it is should be received by the party for making the offer before they send a post the letter of acceptance.

In the case of Tallerman & Co Pty Ltd v Nathan's Merchandise (1957) the court has found the rule of posting rules of the contract but it is not completed until the offers should be accepted by the party through the communication of a letter or email. Therefore a contract is not formed until and unless the posting of a letter of acceptance cannot able to justified by the offer when it could be contemplated and intended to application of such acts (McKendrick, 2014).

Brinkibon v Stahag Stahl und Stahlwarenhandelsgessellschaft mbH House of Lords [1983] is another case of Postal rules where the plaintiff has take legal action against the offering for breach of contract and according to the application of the postal rule in this case has not formed but instead of it a general contract has been formed.

In another case Bressan v Squires Supreme Court of New South Wales [1974] the application of posting rules has been applied because the parties have communicate through using mails for the formation of the contract.

Adam v Lindsell [1818] is one of the most significant cases of the postal rule where it has first applied in this case. The court has found that a contract has been formed through a mail between the parties where both of having common intention and accept the offer but later the acceptance could not be determined. Therefore plaintiff has take legal action against the defendant for causing lots of problem and breach the terms of Postal rule of acceptance.

In the cases of Entores Ltd v Miles Far East Corpn (1955) and Holwell securities Ltd v Hughes (1974) the same transaction of postal rules has been establishes through the communication in relation to the acceptance by the parties (McKendrick, 2014).

Case Study - FramOnline Pty Ltd and Local Livestock Seller

The postal rule has one of the important part in the contract law where it has been found the one of the quickest form of business communication through the post services under the contract law. There are several forms of communication which define most fastest way of Communications like telex, phone, message and email. Through the postal rule the contract has been formed under the basic terms of contract which includes offer and acceptance, consideration, capacity to contract, legal intention and certainty. The postal rule is a part of contract law which describe the terms of contract for the acceptance of an offer has communicated through any posting rules like email or phone or letter for establish a legally binding contract between the two parties. Including this features it also made some rules which are the offer which has been given through the postal letter should not effective until it has been received by the other party or the offer after the acceptance of the offer. It will effective from that moment and form a legal contract between two parties. For the effectiveness of revocation the contract should be formed and the offer which has been received by the offered person before they post the letter to the acceptance.

The fact of the case is FramOnline Pty Ltd has run a business of sale of beef cattle to a firm called Local Livestock Seller. They send a letter to the local seller for selling a beef kettle in total which price should be paid $1,500 and asked to reply to accept this offer. The local seller has replied back where they want to drop the price and make it $1,200 per head. However again the FramOnline Pty Ltd reply them that they are not able to less the price not more than about $1,400 per head for a beef kettle. However they did not get any reply from them. After few days the local seller has replied them that they want they accept the offer but in meanwhile the FramOnline replied by back saying they are not interested to make the business and they also entered into the process of selling the cattle to another purchaser. Therefore as per the terms of contract the FramOnline Pty Ltd has breached the terms of contract and the local seller has rights to take legal steps against them (McKendrick, 2014).

• offer and acceptance which defines that it should be an offer and other party will accept the offer which form agreement between two parties
• the consideration switch stated that the contract has been made in the exchange of money or any property between the two parties
• the capacity to contract define the parties who are entitled to enter into the contract should be capable to form the contact which includes that they must be sound mind and complete the age of minority
• the legal intention define that the purpose of the agreement should create a legal intention for formation of an agreement where a legal relationship will be established between the two parties
• The certainty defines where the contract has been se formed for a particular of time and must be completed under the terms of the contract.

In the postal rules a contract can be formed through a medium of communication which would be email, letter or phone. Therefore as per the terms of contract and postal rules a contract has been satisfying the terms of contract where make an offer to another party which satisfied the term of capacity legal intension and certainty. Therefore according to the first letter of FramOnline Pty Ltd which was sent to the local seller that they want to form the contact by accept the offers on 14 October but before the acceptance of the offer both of the parties has bargain about the business material and on the date of 14^th October the local seller has accept the final offer. Therefore contract has been formed but before the acceptance FramOnline Pty Ltd has breached the terms and from another contract with different purchaser. Therefore they breach the terms of contract.

Conclusion

According to the terms of the postal rule the effectiveness of the contract has applicable when the acceptance has been communicated through a mode of communication. Therefore it is defining the basic rule of the agreement for the communication of acceptance is received. When a letter has been post therefore an offer has been given and reply to the letter to the offer make the acceptance of the offers (McKendrick, 2014).

In the case of Adam v Lindsell [1818] the postal rule has first decided by the court. In this case the defendant has posted a letter to the plaintiff by offering to sell some wool and requested to reply the acceptance of the offer to the post. However the letter which has been posted by the defendant has gone to a wrong address and plaintiff didn’t make any knowledge about the letter. Therefore due to the misrepresentation the defendant did not get any reply from plaintiff and they sold the wool to a third party. Therefore the court has raises the question whether the contract has any effectiveness due to the arrived of the letter to the address and they sell the wool to the third party. Therefore there is no reason to revocation of the offers. Therefore in this case there was a contract has exist before the sale of the wool to the third party even though the letter has not received by the defendant but the defendant was liable to breach the contract.

Therefore as per the terms of contract FramOnline Pty Ltd has breach the contract with the local seller while selling the cattle to the third party. Though they do not have any knowledge about the acceptance by the first party of the offer but while selling it to third party it make a contract and FramOnline Pty Ltd has breach the terms of contract towards the Local Livestock Seller (McKendrick, 2014).

Conclusion

As per the case study it can be concluded that due to the breach of the terms of contract the local seller can take legal action against FramOnline Pty Ltd for selling the beef cattle to the third party.

Reference

Adam v Lindsell [1818] B & Ald 681

Bressan v Squires Supreme Court of New South Wales [1974] 2 NSWLR 460

Brinkibon v Stahag Stahl und Stahlwarenhandelsgessellschaft mbH House of Lords [1983] 2 AC 34

Entores Ltd v Miles Far East Corpn (1955)

Holwell securities Ltd v Hughes (1974)

McKendrick, E. (2014). Contract law: text, cases, and materials. Oxford University Press (UK).

Tallerman & Co Pty Ltd v Nathan's Merchandise (1957) 98 CLR 93, 111-11