Routledge v Grant [1828]
Share
Routledge v Grant [1828] 4 Bing 653 revolved around the formation of a contract and the binding nature of an offer to purchase a lease.
The defendant contacted the claimant in writing, expressing an interest in purchasing the lease of the claimant's home. The offer explicitly stated that it would remain open for a period of six weeks. However, within this six-week period, before the claimant had formally accepted the offer, the defendant had a change of heart about the purchase. Subsequently, the defendant wrote to the claimant again, attempting to withdraw the offer. Nevertheless, after receiving this withdrawal letter, still within the initial six weeks, the claimant proceeded to accept the defendant's original offer.
The central issue for the court to decide was whether the defendant was legally bound by his initial letter, which promised to keep the offer open for six weeks, and consequently, whether he was obligated to honour the claimant's acceptance within that timeframe.
The court's decision was in favour of the defendant. The court held that the original letter did not legally bind the defendant to keep the offer open for the full six weeks. Consequently, the defendant's withdrawal of the offer was deemed valid, and the claimant's acceptance was considered ineffective. The court emphasised a fundamental principle of contract law: for a contract to be valid, it must be mutual, meaning both parties must be bound by it or neither should be bound.
Chief Justice Best succinctly captured this principle, stating that when an offeror extends an offer with a specified time frame for acceptance or rejection, the offeree has the flexibility to accept the offer at any point within that period. He also emphasised that the offeror retains the right to withdraw or revoke the offer at any time before it is formally accepted by the offeree.
In this case, as the offer was not irrevocable, the defendant had the right to withdraw it before acceptance, rendering the claimant's subsequent acceptance ineffective.
The defendant contacted the claimant in writing, expressing an interest in purchasing the lease of the claimant's home. The offer explicitly stated that it would remain open for a period of six weeks. However, within this six-week period, before the claimant had formally accepted the offer, the defendant had a change of heart about the purchase. Subsequently, the defendant wrote to the claimant again, attempting to withdraw the offer. Nevertheless, after receiving this withdrawal letter, still within the initial six weeks, the claimant proceeded to accept the defendant's original offer.
The central issue for the court to decide was whether the defendant was legally bound by his initial letter, which promised to keep the offer open for six weeks, and consequently, whether he was obligated to honour the claimant's acceptance within that timeframe.
The court's decision was in favour of the defendant. The court held that the original letter did not legally bind the defendant to keep the offer open for the full six weeks. Consequently, the defendant's withdrawal of the offer was deemed valid, and the claimant's acceptance was considered ineffective. The court emphasised a fundamental principle of contract law: for a contract to be valid, it must be mutual, meaning both parties must be bound by it or neither should be bound.
Chief Justice Best succinctly captured this principle, stating that when an offeror extends an offer with a specified time frame for acceptance or rejection, the offeree has the flexibility to accept the offer at any point within that period. He also emphasised that the offeror retains the right to withdraw or revoke the offer at any time before it is formally accepted by the offeree.
In this case, as the offer was not irrevocable, the defendant had the right to withdraw it before acceptance, rendering the claimant's subsequent acceptance ineffective.
