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On November 26, Joe wrote to Kate offering to purchase a farm that she owned. Upon...

On November 26, Joe wrote to Kate offering to purchase a farm that she owned. Upon receiving the letter on November 28, Kate immediately sent Joe a letter of acceptance. However, shortly after mailing the letter, Kate had second thoughts and called Joe to advise him that she was rejecting his offer. The call was made before Joe received the letter of acceptance. Has a contract been formed? Why?

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Answer #1

Yes, the contract has been formed, the reason provided below:

  1. As per postal law of United States when both the parties are at a distance from each other and when an offer is sent through mailing the replying accepting or rejecting the offer go through the same mailing medium.
  2. It becomes a valid contract and the contract will be completed once the acceptance letter is posted.
  3. In the above case Kate sent the letter of acceptance through mail and hence it becomes a valid contract.

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