When communication of a proposal is complete?

Question: When communication of a proposal is complete? [RJS 1986]

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Answer

According to The Indian Contract Act 1872, a proposal is defined in Section 2 (a) as “when one person signifies to another person his willingness to do or not to do something (abstain), with a view to obtaining the assent of such person to such an act or abstinence, he is said to make a proposal or an offer.”

Section 4 of The Indian Contract Act, 1872 lays down the provision when communication is said to be completed. It states that, “the communication of a proposal is complete when it comes to the knowledge of the person to whom it is made.”

For example, A proposes, by letter, to sell a house to B at a certain price. The communication of the proposal is complete when B receives the letter.

The first part of the definition of “proposal” lays emphasis upon the requirement that the willingness to make a proposal should be “signified”. To signify means to indicate or declare. In the traditional language of the law of contract, it means that the proposal should be communicated to the other party. The process of making a proposal is completed by the act of communicating it to the other party.

Thus, a proposal may be communicated in anyway which has the effect of laying before the offeree the willingness to do or abstain. It may, for example, be done by words of mouth, or by writing, or even by conduct.

A valid offer may be made either expressly or impliedly. An offer which is made by conduct is called an “implied offer” whereas the one which is made by words written or spoken, is called an “express offer”.

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Law of Contract Mains Questions Series: Important Questions for Judiciary, APO & University Exams

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