H. L. C. 381, was commented on in British & Am. Tel. Co. v. Colson, Law R. 6Exch. 108 (1871).
The Supreme Court of Massachusetts has, however, maintained the doctrine, that no acceptance is binding until knowledge of it has reached the other party. The case, in which this point was decided, is M'Culloch v. The Eagle Ins. Co., 1 Pick. 278, and is as follows: The insurance company, on the first day of January, offered by letter to insure the brig of the plaintiff on certain terras. On the next day the offer was retracted by another letter. On the third day the first letter containing the proposal was received by the plaintiff, and an answer accepting it was immediately put in the mail, before the letter revoking the offer was received. The letter containing the retraction, and that containing the acceptance, crossed each other on the road; and it was held that there was no contract. The reasoning of the court is as follows: "The offer did not bind the plaintiff until it was accepted, and it could not be accepted to the knowledge of the defendants until the letter announcing the acceptance was received, or at most until the regular time for its arrival by mail had elapsed. Had the vessel arrived in safety on the 2d, or on the morning of the 3d, the plaintiff would not have accepted the offer, and was not bound to accept, so that the defendants would not have been entitled to any premium, and both must be bound in order to make the contract binding upon either, unless time is given by one to the other," etc.
The first proposition in this reasoning is only a new definition of the term "acceptance," which the law has already defined differently; and if it be correct, it seems impossible that a contract by letter should ever be completed; since, if the defendants were not bound until they had received notice of the acceptance, by a parity of reasoning, the plaintiffs were not bound until they had received information that their acceptance was acceded to; and inasmuch as neither party could ever be sure that the other party had not retracted by a letter then upon the way, no contract would ever arise. This is the reasoning of the court in Adams v. Lindsell, and seems satisfacof retraction is received, and not when it is sent. But where an acceptance is conveyed b}7 verbal message, it would not seem tory. The true reason why, if the vessel had arrived in safety before the letter containing the acceptance was mailed, there would have been no contract, seems to be that the subject of the contract (namely, a voyage from Martinico to the United States) having failed, the contract also fails; because if a contract be founded upon the existence of something which does not in fact exist, although both parties supposed that it did when the contract was made, the agreement would, of course, be null from error or mistake. But we suppose that if the vessel had arrived at any time subsequent to the mailing of the answer of acceptance, the insurance would have been effected, and the plaintiff would have been rendered liable for the premium. See the subsequent case of M'Intyre v. Parks, 3 Met. 207.
1 This may be considered the well-settled doctrine, notwithstanding a few decisions inclining the other way. See Townsend's Case, Law R. 13 Eq. 148 (1871); Clark v. Dales, 20 Barb. 42; Myers v. Smith, 48 ib. 614 (1867); Trevor v. Wood, 36 N. Y. 307 (1867); Hebb's Case, Law R. 4 Eq. 9 (1867); Thomson v. James, 18 Dunlop, 1; Hutcheson v. Blakeman, 3 Met. (Ky.) 80; Falls v. Gaither, 9 Port. 605; Chiles v. Nelson, 7 Dana, 281; Eliason v. Henshaw, 4 Wheat. 225; Cornwells v. Krengel, 41 111. 394 (1866); Abbott v. Shepard, 48 N. H. 14 (1868); Newcomb v. De Roos, 2 El. & El. 271. The cases sometimes cited opposite are Dunmore v. Alexander, 9 Sh. & Dun. 190; Head v. Prov. Ins. Co., 2 Cranch, 167; Head v. Diggon, 3 Man. & Ryl. 97; Routledge v. Grant, 4 Bing. 653.
The rule, therefore, as stated in Adams v. Lindsell, seems the most correct, namely, "The defendants must be considered in law as making, during every instant of the time their letter was travelling, the same identical offer to the plaintiffs; and then the contract is completed by the acceptance of it by the latter." This rule has been also sustained by the Court of Errors in New York, in the case of Mactier v. Frith, 6 Wend. 103, and in Connecticut, in Averill v. Hedge, 12 Conn. 436. See also an able criticism on the case of Cooke v. Oxley, in 20 Am. Jur. 20, sustaining the doctrine as stated in the text. But see Sprague v. Train, 34 Vt. 150. This doctrine of the common law, as stated in Bracton, 1, 2, c. 5, is supported by the Roman and Scottish law. See 1 Story, Eq. Jur. § 239, note, and cases cited.
Barbeyrac, in his notes on Grotius, says: "If one mentally accedes to an offer, there is, in fact, a union of minds, but assents must be proved; therefore a manifestation of assent is necessary as matter of evidence. It follows that assent to a proposal operates from the time that it is conveyed to the proposer. When they are apart, and communicate by letter or message, the assent operates from the time when the party expresses his assent to the messenger, or puts it on paper in the form of an acceding to the offer made to him." See Pothier on Sales, No. 32 (Cushing's translation); Chitty on Cont. 14; Story on Agency, § 493, note; Long on Sales (Rand's ed.), 6, 183, 199; 2 Kent, Comm. 477, note (2); Mactier v. Frith, 6 Wend. 103; Brisban v. Boyd, 4 Paige, 17, 20. A different rule from this would evidently be productive of great mischief, and clog the facilities of commercial intercourse. Thus, suppose an offer be made to a foreign correspondent to purchase a certain quantity of cotton, at a certain price, during the necessary time which would elapse between the receipt of this letter, and the receipt of the letter assenting to his letter of acceptance, the market might, and in all probability would, so vary as to render either the purchase or the sale undesirable according to the terms of the first proposition, and the bargain would never be concluded. The practical custom of merchants is founded upon the common-sense rule, namely, to accept by letter and send the article immediately, without waiting for an assent to their acceptance.