Story Case

Hays owned a fine racing horse which he wished to sell at once. He made this offer to Brown by mail:

"I will sell 'Bess' to you for $1,000 if you will apprise me of your decision by tomorrow".

Two days later Brown sent this telegram:

"Will take Bess. Was away when your offer arrived".

But when Hays received this telegram he had already sold the horse. Brown sued him, alleging that there was a contract between Hays and himself, and that he had accepted the offer as soon as circumstances admitted. Do you think that Brown should win?

Ruling Court Case. Home Vs. Niver, Volume 168 Massachusetts Reports, Page 4

Niver, who was a dealer in coal, doing business in Salem, on July 17, 1895, wrote a letter to Home, offering "A very low figure on a small lot of our Columbia coal from Salem." The letter continued: "We beg to quote you $2.50 on cars at that place, and should you deem it wise to favor us with an order of five to six hundred tons, kindly wire us at our expense on receipt of this." On July 19, Home replied, ordering four hundred tons. In the meantime, Niver had sold the small lot of coal which he had offered at this price. Thereupon, Home sued for damages.

The defense set up by Niver consisted in the fact that the acceptance of the offer came too late.

Decision

When a person makes an offer and sets no time in which it must be accepted, the offer will expire within a reasonable time. But, if he states in his offer that it must be accepted, if at all, within a certain date, unless it is accepted within the time stipulated, the offer expires when that time has elapsed. Thus, in this case, Niver stated that it must be accepted on receipt of the offer. But Home delayed a day or more before he decided to accept; the result was that, when he did accept, the offer was no longer open to him and his acceptance of no effect.

Therefore, judgment was given for Home in this case.

Ruling Law. Story Case Answer

It is the right and privilege of the offeror to contract on terms and conditions suitable to himself. Thus, he may expressly state that he is willing to enter into a contractual relation only in case the offeree is willing to accept his offer within any given period of time. If he so designates the time, the offeree must accept within that time, or the offer is gone, and he cannot thereafter accept. The mere fact that the offeree is away from home when the offer comes is not material; that is his misfortune; the offer terminates at the time specified, nevertheless.

Thus, in the Story Case, the acceptance of Brown was too late. It was his misfortune that he was away from home when the offer arrived.