Home | Cases | Brinkibon Ltd v Stahag Stahl und Stahlwarenhandelsgessellschaft mbH

 

Key information

Court
House of Lords (UK)

Issues
Acceptance
(communication - postal rule)

AustraliaBrinkibon v Stahag Stahl und Stahlwarenhandelsgessellschaft mbH

House of Lords [1983] 2 AC 34

Facts

The offeror, Brinkibon (London, England) wanted to sue the offeree, Stahag (Vienna, Austria) for breach of contract. Acceptance of Brinkibon’s offer had been by way of telex from London to Austria.  Which jurisdiction’s law applied? The answer to this question depended on whether the postal rule applied - if it did the contract would have been concluded in England and English law would apply; if it did not apply then the contract would have been concluded where the acceptance was received – Vienna.

Held

The postal rule does not apply to direct/instant forms of communication (including telex) – as telex was used here the postal rule did not apply and the contract was formed in Vienna.  The Court also observed that even though with telex the message may not be received by the intended recipient immediately (there may be agents or other third parties who receive the messages to be passed on to the intended recipient) a telex that goes directly from the offeree’s business to the offeror’s business (unlike a telegram which employs the use of a post office) should be treated as if it were an instantaneous communication. If a telex is sent to an office acceptance occurs when the telex reaches the place of business, not when it actually gets to the person it is addressed to.

 

 

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