Business Management Essay

11767 Words Oct 23rd, 2013 48 Pages
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Journal of Politics and Law

Vol. 4, No. 1; March 2011

Clarification of Rules of Acceptance in Making Business Contracts
Dr. Md. Abdul Jalil Associate Professor of Law Department of Business Administration, Faculty of Economics and Management International Islamic University Malaysia (IIUM) E-mail: abduljalil@iiu.edu.my, abd_jalil2@yahoo.com Abstract Business firms and Business corporations enter into thousands of contracts everyday. Making a formal and written contract is very important for business corporations and firms although oral contracts are accepted and recognized by law. There are certain rules on making a valid formal contract. If the business firms do not have knowledge of those contract formation
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To accept an offer, it must come to the knowledge of the offeree. In other words, the offeror must communicate the offer to the offeree. If the offer is communicated by letter through the post office but does not reach the offeree, the offer does not come to the knowledge of the offeror. Therefore, the offeree cannot accept it as he has no knowledge about the offer. How he (offeree) can accept the offer which has not brought to his knowledge (Hudson, 1968). Hence, to accept an offer it must be communicated to the offeree. To communicate the offer, the offeror may utilize any one of different communication media available at present time. It is not essential that the offeror himself has to communicate the offer to the offeree; an authorized person on behalf of the offeror may effectively communicate the offer to the offeree and in that case the offeree can accept the offer and the acceptance will be valid and binding. To make a valid contract acceptance is pertinent. Similarly, the acceptance must be communicated to the offeror. An acceptance is effectively communicated to the offeree when it comes to the knowledge of the offeree. If it does not come to the knowledge of the offeree, as a general rule, the acceptance would not be valid (Pheng and Detta, 2009; Coote, 1974). After sending the acceptance, if the offeree thinks that he has made a mistake

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