3. Period of Time for Acceptance

Obviously, an offer cannot be accepted years after it has been made. Legal certainty for the offeror requires that there are certain time limits after which it does not have to expect an acceptance. Accordingly, Art. 18(2)(2) provides:

An acceptance is not effective if the indication of assent does not reach the offeror within the time he has fixed or, if no time is fixed, within a reasonable time, due account being taken of the circumstances of the transaction, including the rapidity of the means of communication employed by the offeror.

 

a. Determination

A time may be fixed by express reference to a date and time or by any other method that allows for unequivocal determination of the period of time. In case of doubt, Art. 8 applies. The reasonable time applicable in the absences of a fixed time is comprised of a period for the offer to reach the offeree, a period of consideration, and a period for the acceptance to reach the offeror. While the first and the last mainly depend on the form of communication chosen by the offeror, the period of consideration entirely depends on the circumstances of the individual case. Those include the nature of the goods sold, whether or not time is of the essence for the parties, the organizational steps that have to be undergone within the company of the offeree during consideration of the offer or with regard to administrative permissions. Due to the multitude of these factors it is not possible to state any general period of time.

With regard to an offer made orally, Art. 18(2)(3) provides:

An oral offer must be accepted immediately unless the circumstances indicate otherwise.

 

b.  Calculation

Art. 20(1) defines the starting point of the period of time:

(1) A period of time for acceptance fixed by the offeror in a telegram or a letter begins to run from the moment the telegram is handed in for dispatch or from the date shown on the letter or, if no such date is shown, from the date shown on the envelope. A period of time for acceptance fixed by the offeror by telephone, telex or other means of instantaneous communication, begins to run from the moment that the offer reaches the offeree.

A problem specific to cross-border communication is the difference in official holidays from one country to another. Art. 20(2) provides how this problem is solved with regard to the calculation of the period of time for acceptance:

(2) Official holidays or non-business days occurring during the period for acceptance are included in calculating the period. However, if a notice of acceptance cannot be delivered at the address of the offeror on the last day of the period because that day falls on an official holiday or a non-business day at the place of business of the offeror, the period is extended until the first business day which follows.

 

c. Consequences of Late Acceptance

According to the general rule set down in Art. 18(2)(2), a late acceptance is not effective. This rule is, however, not without exceptions as is provided for in Art. 21(1):

(1) A late acceptance is nevertheless effective as an acceptance if without delay the offeror orally so informs the offeree or dispatches a notice to that effect.

This provision gives regard to the fact that the offeror might still be interested in concluding a contract despite the lapse of the period of time under Art. 18(2)(2). Thus, the offeror can cure the belatedness of the acceptance. Yet, the offeror has to inform the offeree accordingly. Notably, under Art. 21(1), it is sufficient that this notice is dispatched. It does not have to reach the offeree to become effective. It is in dispute whether the contract in case of such cure is concluded at the point in time the late acceptance reaches the offeror or at the point in time the notice is dispatched. Yet, the better arguments seem to be in favor of the first position since according to the wording the late acceptance is effective as an acceptance, i.e. pursuant to Art. 18(2)(1) when reaching the offeror and the notice merely retroactively cures the belatedness.

Art. 21(2) contains specific regulations for cases in which the delay of the acceptance is a consequence of failures in the transmission process outside of the offeree’s sphere of control:

(2) If a letter or other writing containing a late acceptance shows that it has been sent in such circumstances that if its transmission had been normal it would have reached the offeror in due time, the late acceptance is effective as an acceptance unless, without delay, the offeror orally informs the offeree that he considers his offer as having lapsed or dispatches a notice to that effect.

Compared to Art. 21(1) where the delay can be attributed to the offeree, under Art. 21(2) the rule exception ratio is reversed. A contract is concluded unless the offeror without undue delay objects orally or by dispatching a notice.

Last modified: Friday, 23 October 2015, 12:50 PM