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2 Ch. D. 463
Tags: Contracts, Acceptance, Options contracts
tl;dr:
A seller gave the buyer a note stating that his offer to sell the buyer his home would stay open until Friday morning, but then the seller sold the home to someone else before the buyer's window to accept ran out.Case Summary
In the 1876 case of Dickinson v. Dodds, the Court of Appeal, Chancery Division,
On a Wednesday, Defendant Dodds (the seller) gave Plaintiff Dickinson (the buyer) a note saying he agreed to sell him his house and that the offer was to stay open until Friday morning at 9 AM. Dickinson decided to accept the offer on Thursday morning but he didn’t tell anyone because he thought he had until Friday morning to accept. On Thursday afternoon Dickinson heard that Dodds was going to sell the home to Thomas Allan. Dickinson attempted to let Dodds know that he was accepting the offer, and chased Dodd down before 9 AM on Friday to accept, but Dodd declined and said “You are too late. I have sold the property.”
Dickinson sued for breach of contract. The trial court found in favor of Dickinson (the buyer), and Dodds appealed.
On appeal, the court found that the Dodds's offer to sell the property for £800 and keep it open until Friday 9 o'clock was not binding without consideration. The defendant was allowed to revoke the offer at any time before acceptance. Additionally, the court ruled that the plaintiff's acceptance was not effective because they had learned from a reliable third party that the property had been sold to another person before notifying the defendant of their acceptance. This information was considered the same as the defendant revoking the offer themselves.
This case demonstrates that an individual making an offer ,the offeror, can withdraw it before the person receiving the offer, the offeree, accepts it, and that the offeree cannot accept an offer after becoming aware of its revocation. The case also shows that courts will not enforce contracts missing key elements such as mutual agreement or consideration.
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