Wagenvoord Broad. Co. v. Canal Automatic Transmission Serv., Inc. - 176 So. 2d 188 (La. Ct. App. 1965)

Rule:

The Louisiana Civil Code seems to recognize a receipt theory of acceptance. According to La. Civ. Code Ann. art. 1809, the obligation is not complete until either the acceptance itself or circumstances indicating acceptance are known to the party proposing; and La. Civ. Code Ann. art. 1819 defines consent to a contract as the concurrence of intention reciprocally communicated.

Facts:

The representative of the broadcasting company contacted the transmission service and secured its signature through a proper representative to an offer for radio advertising. The broadcasting company's agent, however, had no authority to accept the contract. The general manager of the company was the only person who could bind the company to the contract. He completed the contract by signing it. Notification of this alleged completion of the contract was not given to the transmission service by the company. Subsequently, the transmission service advised the broadcasting company that it was withdrawing and cancelling its order, as it did not desire to go through with the purchase. It was only then that the broadcasting company informed the transmission service that the offer had been accepted and there was a contract between the parties. The broadcasting company insisted that the transmission service comply with the agreement, and ultimately filed the present suit praying for specific performance, and alternatively, damages and attorney’s fees. The trial court ruled in favor of the broadcasting company. The transmission service appealed.

Issue:

Must the acceptance of an offer be communicated to the offeror in order to complete the contract, thereby rendering the agreement between the broadcasting company and the transmission service incomplete?

Answer:

Yes.

Conclusion:

The court concluded that the broadcasting company, upon immediate acceptance of the offer, should have completed the acceptance by promptly notifying the transmission service. Instead it waited until the service withdrew its offer by telephone. Because the transmission service's offer was revocable at the time of its withdrawal, no contract was ever consummated.