Contract Law - Lecture 7 Instantaneous Communication in Contracts Instantaneous Communication " Telex · Fax " E mail · Voicemail Why is this important " In today's world, contracts can be made through these means of communication. " Instantaneous communication could be argued to differ from using the post, for which the postal rule is applicable. " In relation to acceptance made using instantaneous communication, it is crucial to determine when and where the acceptance becomes effective. Entores v Miles Far East Corp. [1955] 2 QB 327 " Starting point of the law in this area " Dealt with communication by telex (a special machine connected to phone line, if you typed information into this machine, it would travel down the phone line to recipient, where it is typed out on paper) " The issue was where the acceptance took place " Lord Denning- held acceptance by telex took place where it was received, and not where it was sent " An extension of the postal rule was rejected · Dealt with where not when Entores - Analysis " Are all instantaneous communication similar? No " Should the same rules apply to all? " Are fax and emails not analogous to post? They can sit unread for some time after delivery. " Issues become more pertinent when the question is when (ie time) the communication of acceptance is deemed effective. " Lord Denning- analogy of aeroplane distorting a contract conversation across a river. " For a fax, if there are problems in delivery, it should be noticed and communicated. " However, for emails, there may be no indication of problems in delivery on the part of the recipient. " How about when communication is sent out of office hours? Or when recipient is unavailable to notice? " Was the decision in Entores based more upon what was reasonable to expect in a business context, than on a proper evaluation of the similarityftdissimilarity between modes of instantaneous communication and the post? " Some of these decisions can only be made based on practicality- Apple Corps Ltd v Apple Computer Inc [2004] EWHC 768 - contract happened in both countries at the same time " Conductive Inkjet Technology Ltd v Uni-Pixel Displays Inc [2013] EWHC 2968
" A contract resulting from complex negotiations can be held to be formed in two places at the same time. " Note that Entores dealt with the place where contract was made and not the time. " The case provides no direct authority as regards the time when a telex acceptance is effective. " The postal rule is not applicable, because the Entores principle requires the acceptance to have arrived at the offeror's address for it to be effective. The possibilities " Should acceptance be effective when actually read by offeror? " Should acceptance be effective when read by offeror's agent, e.g. an employee? " Should acceptance be effective when it is received in the machine, and not yet read? " Should acceptance be effective when