Postal Rule and Emails.

ananas

hi friends , I have a quick FE1 question in relation to Contract.

I'm just going through acceptance for Contract and am working off a 2008 Griffith manual. At the time there had been no judicial clarification on whether the postal rule extended as far as electronic communications. Is this still the case? I have googled and not found anything but if anyone would clarify this for me I would be most grateful-Free Cookies for all !!:pac:

Tom Young

You should refer to the eCommerce Act in relation to this. The answer is contained therein.

ananas

Is that the E Commerce act 2000 you're referring to? I know it doesn't extend the postal rule to electronic communications. My question is whether there has been any recent case law on this issue.

dermot_sheehan

Entores v. Miles says it doesn't apply to telex transmissions.

By analogy it doesn't apply to emails.

ananas

gabhain7 wrote: »

Entores v. Miles says it doesn't apply to telex transmissions.

By analogy it doesn't apply to emails.

Your cookies are in the post! Thanks

Tom Young

A contract offer has only been accepted when the acceptance is brought to the attention of the offeror. This applies in the case of instantaneous communication, such as by telephone, where the party giving acceptance will often know at once if a communication is unsuccessful so will have the opportunity of making a proper communication. The exception to this rule is when the acceptance is posted. The offer is deemed to be accepted when the offeree posts their acceptance.

The now commonplace use of email raises the question of whether the "postal acceptance rule" applies to emailed acceptances. Currently there is no statutory law on this point. The contract could be formed when the email acceptance is read or when the email acceptance is sent. If the parties to a contract wish to send notices by email then specific provisions should be included which set out when a notice sent by email is deemed to be received.

I still say S. 20 of the 2000 ECommerce Act needs to be acknowledged.

McDermott on Contract Law makes the point at page 258 [5.20]:

It may be that neither rule should be slavishly followed in the context of electronic contracts and it has been suggested that:

" ....if the present Internet cannot be regarded as being analogous to telephone or telex systems, the rules on instantaneous communications should not apply. However, the alternative postal rule depends on there being a single reliable organisation responsible for the postal service, which it is reasonable for the offeree to trust. This again is not the case on the Internet." Smith, Internet Law and Regulation (2d edn, FT Law and Tax London, 1996, page 14).

As a general rule, silence does not constitute acceptance.

Article 14 of the eCommerce Directive also should be noted. This was transposed in Irish Law via SI 68 of 2003.

If you want to read, see here: http://www.mercuryfrost.net/colr/editions/2007/COLR%202007%2013%20O'Brien.pdf

MagicSean

The idea of the postal rule was surely based on the reliability of An Post as a government body which would ensure delivery. There is no such reliabilty associated with any email provider.

Tom Young

k_mac wrote: »

The idea of the postal rule was surely based on the reliability of An Post as a government body which would ensure delivery. There is no such reliabilty associated with any email provider.

Yep, it appears that is the case.

This UK case from 2010 rehearses Entores and others. For some reason there is no review of the EC elements. The Postal Rule seems to be moot until the receiver has read the acceptance physically: http://www.bailii.org/cgi-bin/markup.cgi?doc=/ew/cases/EWHC/Ch/2010/306.html&query=%22postal+and+rule%22+and+email&method=boolean

The general rule is that the acceptance of an offer is not effective until communicated to the offeror. The "postal rule" is an anomalous exception to the general rule, which is limited to its particular circumstances. It does not apply to acceptances made by some "instantaneous" mode of communication (Chitty on Contracts, 30th edn, paragraph 2-050). This was decided in Entores Ltd v Miles Far East Corporation [1955] 2 QB 327 as regards communications by telex. At page 334, Denning LJ said that in such a case, "The contract is only complete when the acceptance is received by the offeror". Contrary to the claimants' submissions, in my view the same principle applies to communication by email , at least where the parties are conducting the matter by email , as the solicitors were in this case. However, that does not conclude the question, because issues may remain as to when the email in question was received (and also whether it was received). As Lord Wilberforce put it in Brinkibon Ltd v Stahag Stahl G.m.b.h. [1983] 2 AC 34 (another telex case in which Entores was approved) at page 42:
"Where the condition of simultaneity is met, and where it appears to be within the mutual intention of the parties that contractual exchanges should take place in this way, I think it a sound rule, but not necessarily a universal rule.
… . The senders and recipients may not be the principals to the contemplated contract. They may be servants or agents with limited authority. The message may not reach, or be intended to reach, the designated recipient immediately: messages may be sent out of office hours, or at night, with the intention, or upon the assumption, that they will be read at a later time. There may be some error or default at the recipient's end which prevents receipt at the time contemplated and believed in by the sender. The message may have been sent and/or received through machines operated by third persons. And many other variations may occur.
Similar issues arise when the medium of communication is by email . In Brinkibon, Lord Wilberforce's conclusion was that:
"No universal rule can cover all such cases: they must be resolved by reference to the intentions of the parties, by sound business practice and in some cases by a judgment where the risks should lie."
In Bernuth Lines Limited v High Seas Shipping Ltd [2006] 1 Lloyds Rep. 537, it was held that notice of arbitration was validly served by email notwithstanding that it may not have reached the relevant managerial or legal staff in the recipient company. Christopher Clarke J said at p. 541-2:
"[29] That is not to say that clicking on the "send" icon automatically amounts to good service. The e-mail must, of course, be despatched to what is, in fact, the e-mail address of the intended recipient. It must not be rejected by the system. If the sender does not require confirmation of receipt he may not be able to show that receipt has occurred. There may be circumstances where, for instance, there are several e-mail addresses for a number of different divisions of the same company, possibly in different countries, where despatch to a particular e-mail address is not effective service."

These particular considerations do not apply in the present case. It is not in dispute that the email was received in Mr Cusack's mailbox at or close to 18:00 on 24 August 2007, and was available to be read by him. The question is whether the defendants are correct in their submission that acceptance was not effective from the moment the email was received because it was sent after working hours. In those circumstances, it is submitted, relying on the passage in Lord Wilberforce's judgment that I have quoted, acceptance by the 18.00 email could not in any event have been effective until it came to Mr Cusack's eye on Tuesday morning.

brian__foley

Two more cents.

First, start from the general rule that acceptance must be received by the offeror which means actual receipt, save where the law acknowledges specific exceptions (postal rule etc).

Second, then look at the Electronic Commerce Act, 2000 and othe regulations.

Some (and me) would think that Article 14 and Section 20 as noted above are red-herrings. All they do is deal with acknowledgment of certain e-communications. At no point that I know of, has it ever been decided that "acknowledgement" is the same as "acceptance" and particular problems are caused by automated acknowledgement systems. So, even if someone requires acknowledgement under s.20, I just don't see its relevance to determining when an acceptance is "received".

The interesting section may be s.21(2) which says that unless otherwise agreed between the originator and the addressee or the law otherwise provides, the electronic communication is taken to have been received when it enters the first information system. However, this doesn't mean that what receipt means for the purpose of offer and acceptance has been changed and therein is the problem. To think the 2000 Act has changed anything, you have make the deeper leap in logic and assume that the 2000 Act was designed to alter concepts such as "receipt" in a very general sense, and its not clear at all.

brian__foley

k_mac wrote: »

The idea of the postal rule was surely based on the reliability of An Post as a government body which would ensure delivery. There is no such reliabilty associated with any email provider.

A little deeper, depending on what theory you buy - i.e. its not reliability, but the notion that the postal service is the joint agent of the parties. That's one explanation, but it doesn't relate to reliability.