Did the “I accept” note scribbled on the napkin mailed to Ms. Daughtery create a binding contract between the two parties over the sale of 1965 Corvette Stingray, even though she has not received the acceptance note yet?
Yes this is a binding contract between the two parties. While this may be an unconventional acceptance of an offer, it is still binding contract between our client, Mr. deCapo and Ms. Daughtery. Ms Daughtery sent our client an offer note on February 13, 2008, selling her 1965 Corvette Stingray for the amount of 25,995 plus all title transfer fees. Approximately thirty days later our client Mr. deCapo sent Ms. Daughtery his acceptance of her terms for the sale of her vehicle with the additional cost for title transfer fees. Our client chose accept her terms, via a note on a napkin and sent in the mail.
The note sent from Ms. Daughtery is in fact a valid offer of sales to Mr. deCapo. It was a simple offer and only asking the price of the car as well as transfer title fee. Once Mr. deCapo accepted the offer it became a binding contract. Even though Ms. Daughtery has not received the acceptance note from our client, according to the mailbox rule once it went into the mail it became a binding contract. There were no stipulations in Ms. Daughtery’s note to a specific timeline, the thirty days it took our client to respond has no bearing.
The performance is the means of acceptance in this case under the mailbox rule. The mailed acceptance is a reasonable form to commit to the offer. If our client was responding with a revocation of his offer this would not be acceptable under the mailbox rule. Especially if it was sent after the acceptance was sent. The offer of acceptance would arrive first therefore making it a binding contract between the two parties. In the case Adams v. Lindsell, “The acceptance was mailed on September 5; was not received until September 9. The offeror changed his mind in the meantime and claimed there was no binding contract. But the court held the contract was formed on September 5 when the acceptance was mailed” (www.kentlaw.edu).
There is nothing about this process that would cause this to not be a valid binding contract. The note was sent by Ms. Daughtery and the acceptance was sent by our client. The acceptance became valid once the scribble acceptance napkin by our client was put in the mail. Even though Ms. Daughtery has not received the communication from Mr. deCapo it does not change the fact that he has accepted the offer from Ms. Daughtery. There was never a communication of an in-person delivery of the acceptance nor was there a stipulation of an expired time period for the acceptance offer, thus making this a binding contract between our client and Ms. Daughtery.
Seller warrants that:
(1) Clarice Daughtery (seller) is the sole owner of the vehicle; (2) such vehicle is free of all encumbrances, security interests, and other defenses against seller; (3) the cash price of $25995.00 and the additional amount all transfer title fees; (4) the vehicle will be delivered to and accepted by Leo deCapo (buyer) on day of payment; (5) Leo deCapo is of legal age and legally competent to execute the contract on the date thereof; (6) all disclosures to buyer and other matters in connection with such transaction, are in all respects as required by, and in accordance with, all applicable laws and regulations governing them. (7) Inspection and Acceptance of Vehicle: the buyer will assume cost of the inspection of the vehicle, if the vehicle is not found to be mechanically sound per sellers description; buyer shall return vehicle and cancel payment of check. Inspection and Acceptance of Vehicle: 4 hours prior to completion of transaction. (8) The seller and/or buyer agree to sign related documents necessary to complete the sale to establish title. Dated:
Mailbox rules cases, retrieved on February 5, 2011,
South University Online Lectures, retrieved on February 5, 2011 http://myeclassonline.com
Twomey, D. and Jennings, M. (2008) Business Law and Legal Environment 21st ed.