Story Case

In the Kentucky mountains there was formerly no United States mail, so James Tullifer, who had some corn for sale, wrote to the miller, Hobes:

December 16, 1845. Dear Sir:

I have for sale 50 bushels of corn which I will sell to you at the same rate I made you last year. If you want this corn, leave a note for me under the stone at the Cross Roads.

(Signed) James Tullifer".

Hobes left a note under the stone for Tullifer but some children destroyed it. Tullifer did not find a note for him and sold the corn to another miller.

Hobes, thinking that Tullifer would deliver the corn, incurred a great expense in preparing to grind it. He now sued Tullifer for the damage it caused him to be deprived of the corn and for breach of the contract to sell. Tullifer defended on the ground that he did not receive the acceptance and, therefore, was not bound.

Which party won?

Ruling Court Case. Phebe Howard Vs. August Daly, Volume 61 New York Reports, Page 362; Volume 19 American Reports, Page 285

August Daly was the manager and proprietor of the Fifth Avenue Theater in the City of New York. Phebe Howard applied to him for employment as an actress. The evidence showed that an offer in writing was made by Daly to Phebe Howard for the engagement of her services for one year at ten dollars per week. He sent with this proposal a duplicate copy which was to be signed and returned by her as her acceptance. She signed the duplicate and placed it in the letter box of Daly at his theater. He admitted this box was used as a place for deposit of the duplicates of contracts made between him and actors and actresses. When the season opened, Phebe reported for duty but August Daly refused to employ her or to recognize any contractual relation between them. She sued him for damages.

His defense consisted in the fact that he never received the duplicate from her by which she accepted the employment, and, therefore, no contract ever resulted.

Decision

Where acceptance of an offer is authorized in a certain manner, or where such offer has been customarily accepted in that manner, compliance with the authority or custom is all that is necessary to constitute a binding contract. In this case, it was shown to be customary for acceptances of offers to be put in Daly's letter box. When Phebe satisfied this demand, a contractual relation was established between herself and Daly, and it is his misfortune if he never received the acceptance.

It was said in the opinion by the Court: "It is true that he (Daly) testified, that he never received the papers which Phebe asserts that she placed in his box. This, however, is immaterial. The minds of the parties met when she complied with the usual, or even the occasional practice, and left the acceptance in a place of deposit, recognized as such by Daly".

Judgment was given for Phebe Howard for damages.

Ruling Law. Story Case Answer

An acceptance made in the manner authorized by the offeror is good, even though he may never actually know of the acceptance. In the Story Case, Tullifer authorized an acceptance in a rather unusual manner, and he must assume the consequences of any accident which arises in reference to the acceptance. When Hobes placed the note of acceptance at the place specified, the contract was complete; therefore, he is entitled to recover damages from Tullifer caused by the failure of the latter to deliver the corn. The same problem was considered in the Court Case of Howard vs. Daly. The court there held that an acceptance made in the authorized or customary way was sufficient even though Mr. Daly never in fact received the acceptance.