acceptance of a lapsed offer
29 March 2007

In the matter of EP MANNA v JM LOTTER (CPD) 9708/04

A buyer launched an application in the Cape High Court to compel the seller to sign the necessary documents, so that transfer could be registered. The seller opposed the application on the basis that there was no binding agreement, because she accepted the offer after it had already lapsed.

The Judge immediately drew the following distinction in his judgement: If an offer is accepted by a seller before the time to accept it has lapsed, then the buyer, who made the offer, is undoubtedly bound to the agreement. But what is the situation where the seller accepts the offer, after it has lapsed, and the buyer then still wants to proceed?  Can the seller then escape the agreement by relying on the fact that the offer lapsed before she accepted it?

There are no precedents in South African law and hence the Court was compelled to look at foreign law and views expressed by respected authors. After analysing the possibilities the Court held that the best way to approach this type of scenario would be to regard the expiry date as a stipulation that was inserted solely for the benefit of the buyer, which benefit he could elect to waive. 

On this basis then the court held that notwithstanding a late acceptance of the buyer's offer, the fact that the buyer had elected to proceed afterward indicated his willingness to accept the "irregular" acceptance and as such the agreement remained valid and binding.

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