Kempner v. Cohn - 47 Ark. 519, 1 S.W. 869 (1886)

Rule:

When parties conduct a negotiation through the mail a contract is completed the moment a letter accepting the offer is mailed, provided it be done with due diligence after receipt of the letter containing the proposal and before any intimation is received that the offer is withdrawn.

Facts:

J. Cohn (plaintiff) sued Kempner (defendant) for the non-payment of an alleged agreement to convey a certain lot on Main Street in the city of Little Rock. He claimed damages for the loss of his bargain, for expenses incurred in investigating the title, for the loss of interest upon the money which he had raised by the sale of interest-bearing securities in order to comply with the terms of purchase and which he had been unable immediately to reinvest to his satisfaction, and for the loss of a profitable lease of the lot which he had made on the faith of getting the lot. The answer denied the existence of any contract between the parties for the sale of the lot. The plaintiff lived in Little Rock, the defendant at Hot Springs. The two cities are about sixty miles apart and there is communication by mail twice a day. On the 28th of January the plaintiff wrote to the defendant inquiring his terms. This letter was put into one of the government letter boxes before plaintiff had received any notice that the offer was withdrawn. The envelope was postmarked Little Rock, February 7, 9 PM. It reached defendant on February 9. The defendant, informed by letter from A. Kempner that plaintiff was making his arrangements to buy the property, wrote, on the 7th of February, to Cohn, that he had changed his mind and now declined to sell. 

Issue:

Was there a meeting of minds between the parties?

Answer:

Yes.

Conclusion:

When parties are conducting a negotiation through the mail, (a contract is completed the moment a letter accepting the offer is posted, provided it be done with due diligence, after receipt of the letter containing the proposal, and before any intimation is received that the offer is withdrawn. The defendant asked us to declare that plaintiff’s acceptance was unreasonably delayed. The subject of negotiation was real estate, which required more deliberation than if it had been a transaction in cotton or other article of merchandise, and less subject to sudden and violent fluctuations in price. Five days was not an unreasonable time within which to come to a determination, have the title looked into, and a conveyance prepared. As to the attempted retraction: An offer made by letter, which is to be answered in the same way, cannot be withdrawn unless the withdrawal reaches the party to whom it is addressed before he has accepted. An uncommunicated revocation is in law no revocation at all. Benjamin on Sales, sec. 44; Tayloe v. Merchants Fire Ins. Co., 9 HOW 390, 13 L. Ed. 187; Stevenson v. McLean, 5 Q. B. Div. 346; S. C. 29 Moak's Eng. Rep., 341; S. C. 20 Amer. Law. Reg. 16; Byrne v. Van Tierhoven, 5 C. P. Div. 344; S. C. 30 Moak's Eng. Rep., 833. When the defendant penned his withdrawal of the offer, he did not know that it had been accepted at that time. However, it was not necessary that he should know of it; and the acceptance was effectual to complete the contract, notwithstanding the defendant had previously mailed a letter to Cohn announcing the retraction of the offer.