Adams v Lindsell (1818) 1 B & ALD 681

📌 Facts

The defendants wrote to the claimants offering to sell them a quantity of wool. The letter stated that the defendants expected to receive a reply by post. However, the defendants incorrectly addressed the offer letter. As a result, it reached the claimants later than it ordinarily would have done.

The claimants received the offer on 5 September and posted a letter accepting it that same evening. Because of the initial delay, the acceptance did not reach the defendants until 9 September.

Believing that the claimants had not accepted the offer, the defendants sold the wool to another buyer on 8 September. The claimants brought an action for failing to complete the sale.

📌 Issue

The issue was whether a binding contract was formed when the claimants posted their letter of acceptance or only when the defendants received it. The court therefore had to determine when an acceptance sent through the post became legally effective.

📌 Decision

The court held that a binding contract had been formed between the parties. The claimants’ acceptance became effective when the letter was posted, rather than when it was received by the defendants. The defendants were therefore already bound by the contract when they sold the wool to another buyer. The defendants were also responsible for the initial delay because they had incorrectly addressed the original offer letter.

The Court stated in the reported judgement:

“… that if that were so, no contract could ever be completed by the post. For if the defendants were not bound by their offer when accepted by the plaintiffs till the answer was received, then the plaintiffs ought not to be bound till after they had received the notification that the defendants had received their answer and assented to it. And so it might go on ad infinitum.”

📌 Analysis

This case established the foundation of the ✉️ postal rule. Where it is reasonable for the parties to communicate by post, acceptance generally becomes effective when the acceptance letter is properly posted, rather than when it reaches the offeror. The ✉️postal rule is an exception to the normal rule that acceptance must be communicated to the offeror.

The court’s reasoning was that, if acceptance only became effective when received, the parties could require an endless series of confirmations that each previous letter had arrived.

It is fairly evident that the court's solution was an arbitrary one as to which of the two parties should be favoured when communicating by post. It is now, however, a firmly established principle in law.

The ✉️postal rule will apply where:

• the use of the post was expressly or impliedly authorised;

• it was reasonable to accept by post; and

• the acceptance letter was properly addressed and posted.

What if the Letter Was Lost?

This is where the ✉️ postal rule becomes particularly significant. Under the ✉️ postal rule:

✅ The contract is still formed.

Provided the acceptance was properly addressed and posted, the risk of loss generally falls on the offeror rather than the offeree.

For more information on the postal rule, you can read our Contract Law Questions article here.

Further Reading

• Offer and Acceptance Revision Sheet

• What is the Postal Rule and How Does it Apply?

• Tinn v Hoffman Case Summary