This case is about the examination of the validity of a contract if there exists no acceptance.

Facts of the case

The defendant in January 1913 sent out all his servants to different places in order to find his nephew who had been absconded from his house. Plaintiff was one among the servants who had been sent out to search for his master’s nephew. He was sent to Hardwar from Cawnpore where he was finally able to track down the lost child and for this accomplishment, he was given Rs 20 along with two sovereigns on his return to Cawnpore. While the searching was taking place, and the plaintiff was in search of the child, the defendant issued a handbill offering a reward of Rs 501 to the person who would successfully trace down the child and the plaintiff had no idea of this reward.

Later on, after 6 months of the incident taking place, the plaintiff brought a suit against his master claiming the prize money of Rs 499 stating that it was promised by his master that whoever would find his child would be entitled to this reward. He alleged his master of not providing the reward for the specific performance of his promise

Issues Raised

When the case was filed by the plaintiff in the lower court it was rejected. He then went on to file the case at the Allahabad High Court. The issues raised are as follows:

  • Whether the current situation amounts to contract?
  • Whether the claim of Rs. 499 be provided or not?
  • Whether the decision by the lower court was appropriate or not?

Contentions of the parties

Petitioners

It was strongly contended by the petitioner that the mere performance of the act was sufficient to be deserving of the reward attached to such performance. According to them, it was immaterial whether the person performing the act had the knowledge of the reward associated with or not.

They referred to the Section 8 of the Indian Contract Act, 1872, which states that the performance of a condition of a proposal is an acceptance of the proposal and in the current case, the condition was the whoever found the missing child of the defendant would be rewarded with the promised amount and thus considering the provision he claimed to have fulfilled the condition, hence the plaintiff is entitled to claim the reward.

Respondents

The respondents contended that in order to convert an offer into a convert there must be acceptance of that contract and assent is the basic essential to constitute a contract. At the time he was tracing the boy he was not aware of the offer and therefore had not accepted the offer which clearly doesn’t convert the offer into a valid contract between both the parties.

It was argued that at the time he was tracing the boy, he was acting as a servant and thus fulfilling his responsibilities and obligations which came with it and thus was sent to Hardwar from Cawnpore.

Rule and Related case laws

Section 2(a) of the Indian Contract Act, 1872 defines proposal as follows-

“When one person signifies to another his willingness to do or to abstain from doing anything, with a view to obtaining the assent of that other to such act or abstinence, he is said to make a proposal.”

Section 2(b) of the Indian Contract Act, 1872 defines a promise as follows-

“When the person to whom the proposal is made signifies his assent thereto, the proposal is said to be accepted. A proposal, when accepted, becomes a promise.”

Section 2(h) of the Indian Contract Act, 1872 defines a contract as follows-

“An agreement enforceable by law is a contract.”

Section 3 of the Indian Contract Act, 1872 states that-

The proposal must be communicated to the person who is expected to accept the offer.

Section 8 of Indian Contract Ct, 1872 defines-

“Performance of the conditions of a proposal, or the acceptance of any consideration for a reciprocal promise which may be offered with a proposal, is an acceptance of the proposal.”

This means that-Offer + Acceptance = Agreement

Agreement + Enforceable by law = Contract

The plaintiff argued in support of the following cases-

  • Gibbons v. Proctor[1]

It was held by the Divisional Court that if a person performs certain conditions of an offer and completely unaware of the reward on completion of the requisites, he is bound to get the reward.

  • Williams v. Carwadine[2]

It was held that there exists a valid contract when the offer is accepted on accomplishing the ineluctable conditions entailed by the proposer through his proposal.

Whereas, the defendant relied upon-

  • Fitch v. Snedker[3]

He pleaded that the claim could be made only if the contract was made. While the plaintiff lacked acceptance to the provided offer due to which there is no occurrence of the contract.

Judgement

It was held by the Hon’ble Court that the basic necessity is the knowledge and assent of a proposal in order to convert a proposal into an enforceable agreement and in the present case none of the criteria are being fulfilled as the plaintiff was not aware and there was no assent about the particular act. It was also laid down by the judge that at the time the plaintiff was just fulfilling his obligations while he was tracing the boy. Therefore the appeal was dismissed and it was decided by the court that the plaintiff was not entitled to claim the reward for finding the missing child.

Conclusion

This is a very important case of a general offer. Thus, it has helped lay down the important principles of a general offer. In the case of a general offer, a contract is made with a person who has perfect knowledge of the offer and comes forward and acts according to the conditions of the offer. An offer of reward made by way of advertisement for finding lost articles is the most appropriate example of a general offer as seen in this case also.

Only the person who completes the task which has a reward attached to it can accept the offer. Whereas, in the present case the offeror lacked acceptance and communication and hence, not entitled to the reward in return.

References

https://www.ourlegalworld.com/lalman-shukla-v-gauri-dutt-case-analysis-our-legal-world/

https://judicialeconomist.blogspot.com/2019/08/lalman-shukla-vs-gauri-dutt-1913.html

https://lawzmag.com/2018/01/04/lalman-shukla-vs-gauri-datt/

http://lawtimesjournal.in/lalman-shukla-vs-gauri-datt/

[1] Gibbons v Proctor, [1891] 64 LT 594

[2] Williams v. Carwadine, [1833] EWHC KB J44

[3] Fitch v Snedkar, [1868] 38 N. Y. 248

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