Question

Problem Questior

Alan had heard that the current owner of Rosenberg Hall was thinking of selling. On 28 April 2020 he wrote a letter to the owner, John, in the following terms: 'Are you interested in selling Rosenberg Hall? If so, at what price?' John received the letter on 29 April 2020 and replied that same day by facsimile addressed to Alan thus: 1 will sell you Rosenberg Hall for $1.000,000. The terms and conditions will be those in the NSW Property Act standard form real estate contract. Please reply by facsimile before 5 May 2020 confirming your acceptance Unfortunately, John's secretary Carol, when sending the facsimile, misdirected it, and it wa received by Sandra. Realising her mistake immediately, Carol re-sent the facsimile to Alan and telephoned Sandra to tell her that the facsimile was sent by mistake.

On 1 May 2020 Alan sent a letter to John, saying: 1 accept your offer to sell Rosenberg Hall and surrounding grounds for $1,000,000. . However, on the same day the stock market wen into a spectacular dive, and by 5 pm Alan had lost a lot of money. Feeling that he could no longer afford to purchase Rosenberg Hall, Alan sent a facsimile to John, which John received at 6 pm, saying that he no longer wished to purchase the property. At this point John had no received Alan's letter of 1 May

Sandra had been extremely interested in purchasing Rosenberg Hall and, ignoring Carol's advice to disregard the facsimile, she faxed an acceptance of the offer immediately upon receipt of John's mis-sent fax on 29 April.

On 1 May 2020 after John received Alan's facsimile stating he no longer wished to purchase Rosenberg Hall, John decided to follow up on Sandra's fax. He sent her a reply by fax, saying: 'l am in receipt of your facsimile of 29 April 2020. I advise that the price is $1,000,000 for the Hall alone.

Sandra received that fax on 1 May and replied that she would purchase the Hall for $1,000,000. On 3 May 2020 John replied that he would accept that price.

On 4 May 2020 Alan recovered all of his losses on the stock market and made a profit. He telephoned John to say that he would now purchase the hall for $1,000,000.

Discuss in a problem-solving format by reference to the law of contract the following:

a. Is there an enforceable contract between(Alanand John/for Rosenberg Hall?

Answer 1

The communication of a proposal is complete when it comes to the knowledge of the person to whom it is made.

JOHN (proposer) TO ALAN (acceptor)

John received the letter on 29 April 2020 and John replied that same day by facsimile addressed to Alan thus: 1 will sell you Rosenberg Hall for $1.000,000 and received

So communication of Proposal on the date ALAN Received the Letter.

ALAN( acceptor) to JOHN( proposer)

The communication of an acceptance is complete,

– as against the proposer, when it is put in a course of transmission to him,(i.e. Against ALAN

-as against the acceptor, when it comes to the knowledge of the proposer.

On 1 May 2020 Alan sent a letter to John, saying: 1 accepts your offer to sell Rosenberg Hall and surrounding grounds for $1,000,000. It came to knowledge of JOHN (acceptor) on 01 may 2020.

As against the John the acceptance is on may 1 2020.

But before that itself ALAN communicated the Revocation of Acceptance. So the acceptance has been revoked on Telephone Immediately.

So the contract has been cancelled on 01/may/ 2020. So John has no obligation to sell to ALAN.

Since the Acceptance has been revoked there is no contract between john and ALAN

JOHN(proposer) TO Sandra(acceptor)

Offer can be accepted by person to whom offer has been made.

Sandra ignoring Carol's advice to disregard the facsimile, she faxed an acceptance of the offer immediately upon receipt of John's mis-sent fax on 29 April.

So on 29 apr 2020 no acceptance by SANDRA. Since there is no offer to her.

But on 1 May 2020 John decided to follow up on Sandra's fax. He sent her a reply by fax, saying: 'l am in receipt of your facsimile of 29 April 2020. I advise that the price is $1,000,000 for the Hall alone.

Sandra received that fax on 1 May and replied that she would purchase the Hall for $1,000,000.

So the offer has been communicated to Sandra on 01/may/ 2020.

There has been an acceptance of offer on01may 2020. This contract is legally enforceable.

So john is not legally bound to accept the Acceptance of ALAN on 04/may/2020. Since its already been revoked on01 may 2020.

If john wants to accept, john can accept the offer of ALAN only after cancelling the contract with Sandra.