The question states that Johari offered Ben to buy his yacht, Thunder for RM2 million by sending a letter to Ben, but Johari wanted to revoke the offer he made. In the meantime, Ben immediately sent an acceptance letter to Johari stating that he was interested in purchasing the yacht. The issue in the question asked is whether there is a binding contract between Ben and Johari and whether Ben can take legal action if Johari refuses to sell his yacht. Say no to plagiarism. Get a tailor-made essay on “Why Violent Video Games Should Not Be Banned”? Get an Original Essay An offer is a promise to exchange performance or something of value between two parties. Mentioned in Section 2(a) of the Contract Act, 1950, "when one people signifies to another their willingness to do or to refrain from doing anything, with a view to obtaining consent of this other to the act or abstinence, it is said: to make a proposition” (Lee and Detta, 2011). An offer can be made orally or in writing (Lee and Detta, 2011). The offeror is the person who proposes to submit the offer. Offered is the person who accepts the offer. An offer can be made to a specific person or to the public. Bilateral offer is an offer made to a specific person or group of people (Krishnan, Rajoo & Vergis, 2009). The offeror must present certain conditions in the offer and leave the decision of its acceptance or refusal to the offeree. The offer and the conditions that include the offer must be stated precisely and clearly. In the question asked, Johari is the offeror while Ben is the receiver. The letter clearly stated that Johari was willing to sell his yacht, Thunder, to Ben for RM2 million. The yacht is known as something of value in the deal between Johari and Ben. The offeror must communicate the offer to the offeree and the offeree must have actual knowledge of the offer, otherwise the offer is not valid. Section 4(1) of the Contracts Act states that “communication of the proposal is complete when it comes to the knowledge of the person to whom it is made”. (Krishan, Rajoo and Vergis, 2009). This is illustrated in the case of Taylor v Laird (1856). In this case, the plaintiff was employed to work as the captain of a ship owned by the defendant. During the voyage the plaintiff voluntarily stopped working as captain and helped bring the ship back to Britain as a normal member of the crew without informing the defendant of the changes in his working position and he wanted to claim the salary for his work. . The court ruled that the plaintiff could not do so because he had not communicated to the defendant the offer to change his job position and that the defendant did not have the opportunity to accept or refuse the offer. Therefore, there was no binding agreement between the plaintiff and the defendant (Krishan, Rajoo & Vergis, 2009). Section 3 of the Contracts Act 1950 states that “communication of an offer or proposal shall be deemed to have been made by any act or omission of the proposing party by which he intends to communicate the proposal or who has effect of such communication.” In the question asked, the way of communicating the offer between Ben and Johari is by posting a letter. Johari offered to sell his yacht to Ben and sent Ben a letter on March 3. Effective communication is done once Ben receives the offer letter from Johari. Section 2(b) of the Contracts Act, 1950 states that "when the person to whom the proposal is made signifies his agreement to the offer, the proposal is said to be accepted: the proposal, once accepted, becomes a promise. (Krishnan, Rajooand Vergis, 2009). There must be an acceptance made by a recipient in order to validate a contract. Acceptance must be “absolute” and “without qualification” in accordance with Section 7(a) of the Contract Act, 1950. The offeree must accept and have actual knowledge of the offer. An acceptance must be an agreement that consents to all conditions included in the offer, otherwise it will be a counter-offer. (Krishan, Rajoo and Vergis, 2009). Acceptance may be made orally or in writing. Section 7(b) of the Contracts Act 1950 states that “be expressed in a customary and reasonable manner, unless the proposal specifies the manner in which it is to be accepted (Lee and Detta, 2009). If the proposal prescribes a manner in which it is to be accepted and acceptance is not made in that manner, the proposer may, within a reasonable time after acceptance has been communicated to him, insist that his proposal be accepted in the prescribed manner, and not otherwise; but if he does not, he accepts acceptance. Acceptance must be communicated and silence cannot constitute acceptance. Section 9 of the Contract Act states: “To the extent that the offer or acceptance of a promise is made orally, the promise is said to be express. » To the extent that the proposal or acceptance is made otherwise than by words, the promise is said to be implicit. (Krishan, Rajoo and Vergis, 2009). This can be illustrated in the case of Felthouse v Bindley (1862). In this case, the plaintiff wanted to buy a horse for his nephew but there was a negotiation over the price of the horse. After the discussion, the plaintiff mailed a letter to the nephew in which he stated that the horse would be his if he did not get more from the nephew. His nephew did not respond but wanted to sell him the horse and asked the defendant, the auctioneer responsible for selling the farm's livestock for the nephew, to keep the horse. However, the defendant accidentally sold the horse to a third party. The court held that there was no contract between the plaintiff and his nephew as no communication had been made that acceptance of the offer had been made, although his nephew intended to sell the horse (Richards, 1995). However, the Postal Rule can be applied if acceptance is made by letter. Section 4(2)(a) of the Contracts Act 1950 provides an exception to the general rule where the parties have contemplated the use of post as a means of communication (Lee and Detta, 2011). Actual acceptance occurs once the letter is duly addressed, stamped, placed in the mailbox and deposited at the post office. The valid contract exists even though the letter of acceptance is delayed, lost in the mail, or the offeror may not know of the acceptance. This can be illustrated in the case of Household Fire Insurance Company v Grant (1879). In this case, the defendant published a written request to purchase shares in the plaintiff's company. After this, the company sent a share allotment letter to the defendant, but the letter never reached the defendant. The company went bankrupt after three years and the liquidator asked the defendant to pay for the shares. The court ruled that the postal rule can be applied, the defendant was responsible for payment of the shares since acceptance occurred when the letter was mailed and the valid contract exists even though the defendant did not receive the letter (Keenan, 2000). Faced with the question, Ben sent an acceptance letter on March 10 and the letter arrived in Johari on March 12. Ben used the reasonable mode of communication of publishing the letter in the same manner as the mode used by Johari. The postal rule can be applied because acceptance of the offer is.