LCI Learning

Share on Facebook

Share on Twitter

Share on LinkedIn

Share on Email

Share More

When a product is advertised on a website and someone accesses that website in order to buy them then the seller of the goods makes an invitation to offer to public at large through ways similar to advertisements, catalogues and shop displays, in such a case the seller does not become the offerer because he is merely inviting offers and not making an offer which a well established doctrine of law of contracts, now the buyer of the goods make an offer by accepting the terms and conditions of the seller and offers the seller of the goods to sell the goods at the price marked. When it comes to acceptance, the question which arises in our mind is that what constitutes an acceptance? Acceptance as defined in the Indian Contracts Act 1872 means, when the person to whom the proposal is made signifies his assent thereto, the proposal is said to be accepted. A proposal when accepted becomes a promise. The Act also lays down the provisions regarding the situation when communication is complete, s.4 of the Act lays down that the communication of a proposal is complete when it comes to the knowledge of the person to whom it is made. The communication of acceptance is complete –

As against the proposer, when it is put in course of transaction to him, so as to be out of the power of the acceptor.
As against the acceptor, when it comes to the knowledge of the proposer.

After analysing these two concepts under the Contracts Act, the question that arises in our minds is that whether the offer made by the buyer comes to the knowledge of the seller before the acceptance is made by the computer program on his behalf , whether the acceptance on part of the computer program would amount to a valid acceptance or not. In cases of e-contracts, even though the communication of acceptance is not complete and the computer program itself accepts the offer on behalf of the acceptor and that too without any knowledge of the acceptor but still these contract are deemed to be legal.

In present scenario, if an offer has been made, then prima facie the seller's computer uses the set of instructions to accept the offer and evince an intention to assent to that offer. But whose intention is it exactly? There appear to be three possibilities:
(1) intention may be of the seller's computer alone but since computers are not capable of being parties, it must follow that we do not have a meeting of minds by the parties themselves; or

(2) intention may be the seller's alone, this view, however, is problematic given that the seller never knows of the transaction; or

(3) intention may be the seller's though embodied in an e- program of the computer. Can this view be realistic, though, when the decision to make the offer in question has been formed autonomously by the seller's computer?

If a question before the court of law comes about the legality of such a contract entered between the parties through a computer program, in my view the first and the second possibilities are not at all applicable to the present scenario. The third possibility, however, is more useful because this is particularly in light of powerful evidence that English courts, at least, are willing to use the option or unilateral contract device both actively and creatively.

In Great Northern Railway. v. Witham classic formulation of the option or unilateral contract: "If I say to another, ' I f you go to York, I will give you £100,' that is in a certain sense a unilateral contract. He has not promised to go to York. But, if he goes it cannot be doubted that he will be entitled to receive the £100.

What would the effect be of recognising the classic formulation as: "If you order goods from my computer, I promise to supply those goods."

Here, it may be that the issue of whether or not the specific transaction between the buyer and the computer amounts to a valid contract is moot when the irrevocable offer, by the controller, matures into a complete bilateral contract.

"Loved reading this piece by G. ARAVINTHAN?
Join LAWyersClubIndia's network for daily News Updates, Judgment Summaries, Articles, Forum Threads, Online Law Courses, and MUCH MORE!!"

Tags :

Category Intellectual Property Rights, Other Articles by - G. ARAVINTHAN