November 09, 2011

Explication : the revocability of the offer

Follow-up to The postal rule – Acceptance sent through the post from Aurelie's blog

This difference can be explained by the difference concerning the revocability of the offer in the 3 systems. Whereas German law considers the offer as irrevocable (1), French and English law accept this possibility of revocability in the name of freedom of contract, but with some limitations or exceptions.

The revocability of the offer is possible in England only when no consideration was provided and in case of bilateral contracts (2). In France, the general possibility of revocation (3) is limited to a “reasonable time” by jurisprudence (4). Moreover can the offeror bound himself by proposing a period of validity of the offer (5), which is not possible under English law (6). But this liability is limited to damages. Indeed, French law refused to govern pre-contractual period by contract law, and let apply tort law (droit délictuel) in such situations.

As said before, the choice between the two principal theories of emission and reception allows to answer in three different situations between the time the letter of acceptance was sent and the time it arrives :

- Did the offeree miss the deadline proposed by the offeror to accept the offer?

- Can the offer be revocked by the offeror?

- Is the offeree which send an acceptance and revocked it just after by mail bound when both arrived at the same time? NB: an acceptance is always NOT revocable when the contract was concluded, but is here the contract concluded?

The answers to the first and third question depend purely on the applicable theory. The answer to the second one depends on the applicable theory AND on the applicable law. Indeed, German law which doesn’t allow to revoke the offer has no interest to choose the theory of emission, which will just add problems concerning proofs for the 1st and 3rd situations. On the other hand, English and French law need this theory to protect the offeree from offeror’s revocation during this period.

There’s still one question: why does French law in this Avant projet Catala opt for the reception theory? This project conserved the possibility of revocability and its limitations, but allows the offeree to enforce the contract when it’s not respected (7). As explained by the authors, This “progress” in favour of the offeree is compensated by the theory of reception, which protects more the offeror, and reinforces its possibility to revoke the contract (8)…

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(1) 145 BGB<http://www.gesetze-im-internet.de/bgb/index.html#BJNR001950896BJNE031602377>

(2) Dickinson v. Dodds, 2 Ch. D. 463 (1876). For unilateral contracts, cf. Daulia Ltd v Four Millbank Nominees Ltd [1977] EWCA Civ 5

(3) Civ., 3 févr. 1919, DP 1923. 1, 126. But there are some situation where French law forbid to revoke the offer during a précised time such as consumer credit law (15 days), electronical contracts (while it is accessible on the website)…

(4) Civ. 3e, 25 mai 2005, no 03-19.411 , Bull. civ. III, no 117 ; CCC 2005. no 166, obs. Leveneur.

(5) Civ. 3e, 7 mai 2008, no 07-11.690, Bull. civ. III, no 79 ; D. 2008. AJ 1480, obs. G. Forest ; Pan. 2969, obs. Amrani Mekki ; RTD civ. 2008. 474, obs. Fages ; CCC 2008, no 194, obs. Leveneur. - Déjà Civ. 1re, 17 déc. 1958, Bull. civ. I, no 579 ; RTD civ. 1959. 336, obs. J. Carbonnier.

(6)

(7) Avant projet Catala, art 1105-4

(8) Avant projet Catala, section “formation of contracts”, art 1104-1107, commentary by Delebecque P. & Mazeau, D., §3 “certainty” < http://www.justice.gouv.fr/art_pix/rapportcatatla0905-anglais.pdf>


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