a. What are the arguments that a binding contract exists? b. What are the arguments that a contract does not exist or should not exist? c. What is the proper outcome? Explain
Cushing filed an application with the office of the Adjutant General of the State of New Hampshire for the use of the Portsmouth Armory to hold a dance on the evening of April 29. The application, made on behalf of the Portsmouth Area Clamshell Alliance, was received by the Adjutant General’s office on or about March 30. On March 31, the Adjutant General mailed a signed contract after agreeing to rent the armory for the evening requested. The agreement required acceptance by the renter affixing his signature to the agreement and then returning the copy to the Adjutant General within five days after receipt. Cushing received the contract offer, signed it on behalf of the Alliance, and placed it in the outbox for mailing on April 3. At 6:30 on the evening of April 4, Cushing received a telephone call from the Adjutant General revoking the rental offer. Cushing stated during the conversation that he had already signed and mailed the contract. The Adjutant General sent a written confirmation of the withdrawal on April 5. On April 6, the Adjutant General’s office received by mail from Cushing the signed contract dated April 3 and postmarked April 5.
b. What are the arguments that a contract does not exist or should not exist?
c. What is the proper outcome? Explain.
Individual C followed the correct procedure and sent the documents in a timely manner to Individual AG. Individual C claims that Individual C signed the contract and placed it in the outbox for mailing on April 3. Moreover, the practice of collection of the letters daily from the outbox and reading them on the same day is quite common in Country U.
As the letter was sent before the purported termination of the agreement by Individual AG on April 4, the termination was not applicable and the arrangement is still legal and enforceable.
Whether the offer clearly states otherwise, the acceptance is effective on dispatch. If the offeree responds by any illegal means, the acceptance is then going to contradict the illegal denial. Individual C signed the document and dropped it in the outbox for mailing on April 3. As it happened before the Individual AG denied the deal on April 4, the revocation was unsuccessful, and the contract is binding and enforceable.