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All England Law Reports/1973/Volume 2 /Holwell Securities Ltd v Hughes - [1973] 2 All ER 476

[1973] 2 All ER 476

Holwell Securities Ltd v Hughes

TEMPLEMAN J

1, 2 MARCH 1973

Contract  Offer and acceptance  Acceptance by post  Mode of acceptance prescribed  Notice in writing
to offeror  Option  Option to purchase freehold property  Notice  Option 'exercisable by notice in writing
to' vendor within prescribed period  Purchaser writing letter to vendor giving notice of exercise of option 
Letter sent by ordinary post  Letter never delivered to vendor  Whether option validly exercised  Law of
Property Act 1925, s 196.

By cl 1 of an agreement dated 19 October 1971 made between the defendant of the one part and the
plaintiffs of the other, the plaintiffs were granted an option to purchase certain freehold property from the
defendant. Clause 2 of the agreement provided: 'The said option shall be exercisable by notice in writing to
the [defendant] at any time within six months from the date hereof.' On 14 April 1972 the plaintiffs' solicitors
wrote a letter to the defendant giving notice of the exercise of the option. The letter was posted, properly
addressed and prepaid, on 14 April, but it was never in fact delivered to the defendant or to his address. In
an action against the defendant seeking specific performance of the option agreement, the plaintiffs
contended that, since a contractual offer could be accepted by posting a letter of acceptance, the time of
acceptance being the moment of posting, the option had been validly exercised when their letter of 14 April
was posted.

Held  Since the agreement prescribed the mode in which it was to be exercised, it followed that it could only
be exercised in the prescribed way, ie by serving notice on the defendant, either by delivering it to him by
hand or in one of the ways authorised by s 196a of the Law of Property Act 1925. The mere posting of the
notice could not

a Section 196, so far as material, provides:

'(3) Any notice required or authorised by this Act to be served shall be sufficiently served if it is left at the last-known place of
abode or business in the United Kingdom of the  person to be served 

'(4) Any notice required or authorised by this Act to be served shall also be sufficiently served, if it is sent by post in a registered
letter addressed to the  person to be served, by name, at the aforesaid place of abode or business  and if that letter is not
returned through the post-office undelivered; and that service shall be deemed to be made at the time at which the registered
letter would in the ordinary course be delivered.

'(5) The provisions of this section shall extend to notices required to be served by any instrument affecting property executed or
coming into operation after the commencement of this Act unless a contrary intention appears  '
[1973] 2 All ER 476 at 477

constitute a valid exercise of the option (see p 480 c, p 481 a, p 482 c, p 484 c to f and p 485 b, post).
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Henthorn v Fraser [189194] All ER Rep 908, Bruner v Moore [1904] 1 Ch 305, Household Fire and Carriage
Accident Insurance Co Ltd v Grant (1879) 4 Ex D 216 and Re Imperial Land Co of Marseilles (1872) 7 Ch
App 587 distinguished.

Notes

For contracts made through the post, see 8 Halsbury's Laws (3rd Edn) 7880, paras 134139, and for cases
on the subject, see 12 Digest (Repl) 96100, 484525.

For the Law of Property Act 1925, s 196, see 27 Halsbury's Statutes (3rd Edn) 617.

Cases referred to in judgment

Berkeley Road (88), London NW9, Re, Rickwood v Turnsek [1971] 1 All ER 254, [1971] Ch 648, [1971] 2
WLR 307.

Bruner v Moore [1904] 1 Ch 305, 73 LJCh 377, 89 LT 738, 12 Digest (Reissue) 99, 516.

Hare v Nicoll [1966] 1 All ER 285, [1966] 2 QB 130, [1966] 2 WLR 441, CA, Digest (Cont Vol B) 665, 300a.

Henthorn v Fraser [1892] 2 Ch 27, [189194] All ER Rep 908, 61 LJCh 373, 66 LT 439, CA, 12 Digest
(Reissue) 74, 383.

Holt v Heatherfield Trust Ltd [1942] 1 All ER 404, [1942] 2 KB 1, 111 LJKB 465, 166 LT 251, 8 Digest (Repl)
597, 406.

Household Fire and Carriage Accident Insurance Co Ltd v Grant (1879) 4 Ex D 216, 48 LJQB 577, 41 LT
298, 44 JP 152, CA, 12 Digest (Reissue) 81, 420.

Imperial Land Co of Marseilles, Re, Harris' Case (1872) 7 Ch App 587, 41 LJCh 621, 26 LT 781, 12 Digest
(Reissue) 97, 490.

Stevenson, Jacques & Co v McLean (1880) 5 QBD 346, 49 LJQB 701, 42 LT 897, 12 Digest (Reissue) 71,
363.

Case also cited

Entores Ltd v Miles Far East Corpn [1955] 2 All ER 493, [1955] 2 QB 327, CA.

Action
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This was an action commenced by writ issued on 4 July 1972 by the plaintiffs, Holwell Securities
Ltd, against the defendant, Thomas Hilaire Hughes, seeking specific performance of an agreement
for the sale by the defendant to the plaintiffs of property known as 571 High Road, Wembley, and
registered at H M Land Registry with absolute freehold title under title no NGL 10503 at the price of
£45,000 such agreement being constituted by an option agreement made in writing and for value
on 19 October 1971 between the plaintiffs and the defendant and exercise of the option by notice in
writing to the defendant dated 14 April 1972. Further or alternatively, the plaintiffs claimed damages
for breach of contract. The defendant denied that the option had been validly exercised. The facts
are set out in the judgment.

W A Macpherson QC and Hubert Picarda for the plaintiffs. Frank Whitworth QC and Roger Ellis for the
defendant.

2 March 1973. The following judgment was delivered.

TEMPLEMAN J.

This is a purchaser's specific performance action based on a written option agreement. The defence is that in
the circumstances which I shall narrate the option was not validly exercised.

The option agreement was dated 19 October 1971 and made between the defendant, Dr Hughes (called 'the
intending vendor'), of the one part, and the plaintiffs, Holwell Securities Ltd (called 'the intending purchaser'),
of the other part. Clause 1 granted the option to purchase the property known as 571 High Road, Wembley,
which was registered at the Land Registry with absolute title. Those premises, 571 High Road, Wembley,
were the residence of the defendant and also the place where he
[1973] 2 All ER 476 at 478

carried on his practice as a general medical practitioner. Clause 2 dealt with the exercise of the option and
was in these terms: 'THE said option shall be exercisable by notice in writing to the Intending Vendor at any
time within six months from the date hereof  '

By a letter dated 14 April 1972, getting near the expiry date for the option, the plaintiffs' solicitors wrote to the
defendant's solicitors. The letter read:

'Re Dr. T H. Hughes and Holwell Securities Limited, 571 High Road, Wembley. We refer to our
earlier correspondence regarding our clients' option to purchase the above property. Our clients
wish to exercise their option and we shall be obliged if you would accept this letter as notice of
the exercise of the option. Kindly acknowledge receipt. We enclose our clients' cheque in your
favour for the sum of £4,500, being the 10 per cent. deposit payable on the exercise of the
option to be held by you as stakeholders. [Finally:] We are sending a copy of this letter to your
client.'

Although cl 2 of the option agreement provided for notice in writing to the intending vendor, a different
arrangement was made with regard to the deposit. Clause 3 of the agreement provided that on the exercise
of the option the intending purchaser 'shall pay to the Intending Vendor's Solicitors as Stakeholders by way
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of deposit the sum of  £4,500'. So notice exercising the option was to go to the vendor, and the deposit
was to go to the vendor's solicitors, and in this letter dated 14 April 1972 the plaintiffs' solicitors purported
both to exercise the option and to send the deposit (which they did) by the letter addressed to the
defendant's solicitors. That letter was delivered by hand to the defendant's solicitors in the afternoon of 14
April. There is no dispute about that. But equally the plaintiffs do not contend that this solicitors' letter was
effective by itself to exercise the option. It is not contended that service on the defendant's solicitors could be
sufficient. On the same day, that is to say 14 April, and about the same time, the plaintiffs' solicitors prepared
another letter. It was dated 14 April and it was addressed, on the letter, to:

'Dr. T. H. Hughes, 571 High Road, Wembley, Middlesex. Dear Sir, Re [and then on the carbon,
which is the only copy we have got, it is left rather vague as to whether they got the number
right] High Road, Wembley, Holwell Securities Limited. We enclose for your information a copy
of a letter today sent to your solicitors.'

So they did what they told the other solicitors they were going to do, namely, send a copy of the letter to the
defendant.

That letter, the one intended for the defendant, and a copy of the letter which had been sent by hand to the
solicitors were, between about 1.30 pm and 2 pm on 14 April, placed in an envelope addressed it is said to
the defendant and that envelope and its contents (to which I shall refer as 'the disputed notice') were
immediately placed in a post basket on the third floor of the principal offices of the plaintiffs' solicitors. There
is no direct evidence that it was ever seen again. What should have happened to the disputed notice, and
what I am invited to infer in fact happened, was this: about 15 minutes after the disputed notice had been
placed in the post basket, the disputed notice and any other letters were collected by a messenger from the
post-room. They were taken to the post-room, a room set aside for that purpose in the plaintiffs' solicitors'
principal offices, and in the post-room the disputed notice was franked with first-class mail postage, and the
franking incorporated a print of the name of the plaintiffs' solicitors together with a direction to deliver the
envelope back to the address thus given in the event of it not being delivered to the addressee. When that
franking was completed, the disputed notice and the contents of other baskets with more letters delivered
from other offices belonging to the plaintiffs' solicitors, were divided into two categories, one providing for
delivery to postal addresses in the London area and the other for delivery outside London. Bundles of about
30 letters
[1973] 2 All ER 476 at 479

were secured by a rubber band and each bundle was dropped into a Post Office mail bag. There were
separate mail bags for the letters intended for the London area and for those intended for other areas. At the
end of the afternoon each mail bag was fastened by string at the neck in the usual way and was taken to the
street entrance to the offices, and at about 6 pm the mail bags were handed over to an employee of the Post
Office, who accepted them and put them on to a Post Office van, and off they went.

I heard evidence from the supervisor of the postal department of the plaintiffs' solicitors, and the chance that
the disputed notice was lost on the premises of the plaintiffs' solicitors, or that there was some failure of the
system so that the disputed notice was not in fact handed over to the Post Office representative on the
evening of 14 April, is negligible and remote.

The same day the defendant's solicitor, who had received his letter by hand, spoke by telephone to the
defendant, and in his evidence the defendant said that he was told that the solicitor had received a letter
which purported to exercise the option, but that the solicitor did not think it was a valid exercise of the option,
and the defendant was told, or at least led to believe, that he could expect to receive a copy, or a similar
letterI am not giving the exact words but it is quite clear that was the general sense of what he was told.
The defendant then gave evidence that he told his solicitor that he had already planned to go to Ireland
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because of illness in his family, and asked whether he could go. He was advised that he was under no
obligation to stay at home and wait for whatever came through the post or whatever might be delivered
otherwise than through the post. So the defendant then left for Ireland that evening and did not return to
Wembley until the morning of 20 April, by which time of course the six months limited by the option
agreement for the exercise of the option had expired.

In the meantime, while the defendant was away, the disputed notice having been taken and accepted by the
Post Office should have been taken by van to a London sorting office at Rathbone Place, and having then
been sorted for Wembley it should have been taken to the Wembley sorting office by van, and then by van
and man it should have gone from the Wembley sorting office to the defendant's address, arriving there on
Saturday 15 April providing it was correctly addressed and providing that no mistake or delay intervened.

As I have said, the defendant is a medical practitioner who lives and practises at 571 High Road, Wembley.
He is in partnership with another doctor, a Dr Blankert, and whenever Dr Blankert is on duty and the
defendant is away Dr Blankert occupies a flat on the top floor of the premises.

[His Lordship considered the layout of the defendant's house, the arrangements for receipt of mail, the
evidence of the defendant and Dr Blankert and continued:] Dr Blankert was quite clear in her evidence, and
the chances that the disputed notice was in fact delivered to the defendant's address between 14 and 20
April without her knowledge are negligible. It follows that, unless Dr Blankert is telling a pack of lies, the
disputed notice was not delivered, and in this state of the evidence I infer, and find, first, that the disputed
notice was posted on 14 April, that is to say before the option expired, and posted in the sense that it was
handed over to the Post Office, to some postman duly authorised to receive it and to transmit it to the
defendant, and that it was properly addressed and properly posted. Secondly, I find that the disputed notice
was never in fact delivered to the defendant or to his address.

Counsel who appeared for the defendant submitted that even if the disputed notice had been delivered it
would not have been sufficient to exercise the option because it did not, in addressing the defendant, say
'Dear Dr Hughes, We are exercising the option'; it merely enclosed for his information a copy of a letter sent
to his solicitors. But when one looks at that copy and finds it says, 'Our clients wish to exercise their option
and we shall be obliged if you would accept this letter as notice of the exercise of the option', it seems to me
that if the defendant had got that letter he
[1973] 2 All ER 476 at 480

would have got what the option agreement says he was to get, notice in writing exercising the option.

The argument in this case then revolves round one point. Counsel for the plaintiffs submits that the option
was exercised when the letter was posted, while counsel for the defendant submits that the option could only
be exercised by delivery. It never was delivered, and thus the option was never exercised at all.

I begin by disembarrassing myself as far as possible from authority and looking at the agreement. The
agreement says the option shall be exercisable 'by notice in writing to the Intended Vendor at any time within
six months from the date hereof'. As a matter of construction I think that meant the notice in writing had to be
given to the intending vendor, and given to him in the sense that he had got to receive it. I leave out of
account for the moment what would have happened if he tried to evade service or if it was delivered to his
house where he lived. Leaving that out of account for a moment, as a matter of construction it seems to me
this option agreement is providing that the notice shall be delivered to the vendor, and if it is not then the
option is not properly exercised.
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I turn now to see what authority has to say on the matter, and the first hint to which I refer is s 196 of the Law
of Property Act 1925. That deals, in sub-s (1), with 'Any notice required or authorised to be served or given
by this Act', and by sub-s (5) the provisions of the section

'shall extend to notices required to be served by any instrument affecting property executed or
coming into operation after the commencement of this Act unless a contrary intention appears.'

In Re 88 Berkeley Road, London NW9, Rickwood v Turnsek Plowman J decided that for the purposes of s
196(4) there was no difference between serving a notice and giving a notice, and it seems to me that, apart
altogether from sub-s (1) which talks about notices being served or given, the same principle must apply to
sub-s (5) and to the option agreement. Counsel for the plaintiffs did not argue that there was any difference
between an agreement which required notice in writing to the vendor and an agreement which required
notice in writing to be given to the vendor. His argument was that notice was given when the disputed notice
was posted. Section 196 contains various directions as to how notice may be given. Subsection (3) provides:

'Any notice required or authorised by this Act to be served shall be sufficiently served if it is left
at the last-known place of abode or business in the United Kingdom of the lessee, lessor,
mortgagee, mortgagor, or other person to be served, or, in case of a notice required or
authorised to be served on a lessee or mortgagor, is affixed or left for him on the land or any
house or building comprised in the lease or mortgage [and so on].'

That gets round the difficulty which might arise, as in the present case, if the defendant were away in Ireland.
You could leave the notice at his last known place of abode or business, which in the present case were one
and the same thing. Then sub-s (4) provides:

'Any notice required or authorised by this Act to be served shall also be sufficiently served, if it
is sent by post in a registered letter addressed to the lessee, lessor, mortgagee, mortgagor, or
other person to be served, by name, at the aforesaid place of abode or business, office, or
counting-house, and if that letter is not returned through the post-office undelivered; and that
service shall be deemed to be made at the time at which the registered letter would in the
ordinary course be delivered.'

I leave out the complication that we now have 'Recorded delivery' with another statute which provides similar
machinery, but the significance of s 196 is this: it
[1973] 2 All ER 476 at 481

assumes that when a notice is required to be served or given it must actually reach the person for whom it is
intended, and there are statutory exceptions which discharge the sender of the notice from proving that it
reached the person in question in certain limited circumstances: first of all, if he can show that the notice was
left at his house or office, and, secondly, if sent by post in a registered letter properly addressed. In that case
if the registered letter is not returned undelivered then it is to be deemed to be sufficiently served, and the
Act specifies that the time at which the service is deemed to be carried out is not the time of posting but the
time of normal delivery. That seems to me to be consistent only with the underlying assumption that notices
which require to be served have got to reach people, and this is a convenient method of proving or deeming
that service has in fact been carried out and that they have been reached. True, as counsel for the plaintiffs
says, you are not obliged to use the Act. You can hand the notice to the addressee personally or serve it in
another form altogether. But in that case, of course, you may not need and do not get the protection afforded
by the Act.

Counsel for the plaintiffs says that s 196 is irrelevant, it is only an extra precaution which could be used. But
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if he is right it is an unnecessary section. All you have got to do to serve a notice, he says, is to pop it in a
pillar box. According to him if you have got to serve a notice by midnight on Friday on a gentleman living in
Blackpool all you have got to do is, one minute before midnight in Brighton, to pop it in a pillar box,
presumably even with a 2 1/2p stamp, and, although it may not get there for another week afterwards, or
may never get there, that is good service and is effective as at the date when it is popped into the pillar box.
In my judgment, s 196 is entirely inconsistent with that argument. It must be remembered that s 196 is only
statutory shorthand for precedents which were commonly in use and which also therefore assumed that a
notice had to be proved to be delivered at or before the required date. Counsel for the plaintiffs seeks to say
there are two sorts of notices: one which he calls an initiation notice and one such as the present which he
calls a completion notice. An initiation notice he describes, for example, as a notice of intention to prosecute,
or something of that sort, and he also said that notice pursuant to a clause in a lease for breaking the term of
the lease was an initiation notice. His submission was that if you found a lease-break clause, thenI am not
quite sure whether he said it certainly was or could well benotice in writing required in that case had to be
actually received subject to the provisions of s 196, whereas if, as in the present case, there was an option to
purchase, then he says posting is good enough, and he was driven to concede that you might in one and the
same lease have three clauses, a lease-break clause, a renewal clause and an option to purchase the
freehold. Each clause might require notice in writing, but some of those notices could be well served by, and
at the time of, popping in the pillar box; other notices would have to be served by delivery and would be
served at the time when the notice was in fact received. That argument seems to me to produce a result
which I should, if possible, strive to avoid. It is not entirely without significance that the plaintiffs' solicitors, in
carrying out what they obviously regarded as the only requirement of the option agreement, namely, service
on the solicitors, were careful to see that the solicitors' letter was delivered by hand well before the date
when the option expired.

I was also referred to Holt v Heatherfield Trust Ltd. That was a case of an assignment of a debt and under s
136 of the Law of Property Act 1925 the assignment takes effect if express notice in writing has been given
to the debtor and the assignment is effectual as from the date of the notice. Atkinson J said ([1942] 1 All ER
at 408, [1942] 2 KB at 6):

'The date of [such] notice is the date of a notice which has been given to the debtor, and refers
back to the express notice in writing mentioned earlier in

[1973] 2 All ER 476 at 482

the section. It is express notice in writing given to the debtor, and, in my judgment, the date of
such notice is the date on which it is received by or on behalf of the debtor. If the notice arrives
at his place of business, and he happens to be away and does not see it personally for another
day or two, I think that would be immaterial; it would be received on his behalf. It cannot be the
date of the notice, because a notice might be written and dated a week before it was posted,
and it would be absurd to suppose that that would be effective.'

Of course, there was a reference to the effective date being the date of the notice and the learned judge only
refers to the possibility of there being a different date on the letter-heading itself and does not refer to the
possibility of the date of posting. But that is a decision in line with s 196 and in line with the view that express
notice in writing, where express notice in writing has got to be given, has got to be actually delivered, subject
to the provisions of s 196.

A large number of cases were cited to me but there was no authority which showed that where the parties
had gone out of their way to say that notice in writing had to be given to a named person then it was
sufficient merely to put the letter in the post box. Counsel for the plaintiffs referred me to the Bills of
Exchange Act 1882, s 49(15), which provides that 'Where a notice of dishonour is duly addressed and
posted, the sender is deemed to have given due notice of dishonour, notwithstanding any miscarriage by the
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post office'. True, that is dealing with another subject-matter but it is implicit in that section that unless there
was something which enabled you to assume that which was in fact untrue, namely that the notice had been
given, then of course you would have to prove actual notice, meaning by that service on the person
concerned, because a deeming provision is merely saying that black shall be white. So far as bills of
exchange are concerned even if the addressee has not received the notice he is deemed to have been given
it notwithstanding any miscarriage by the Post Office. That is in line with s 196 and it is significant that it is
necessary to put sub-s (15) into s 49.

Counsel for the plaintiffs' main submission turns on this: he says if you look at the contract cases, offer and
acceptance, right at the beginning of the law of contract, you will find that it is possible to accept an offer by
putting the acceptance in the post, and that the time for the contract is the date when the acceptance is put
in the post, not the date when it is received and notwithstanding it may not be received. He says here we
have an offer, and the exercise of the option by notice is the acceptance, so that it is pure contract. He cited
for that propositionwhich I think nobody quarrels witha passage in Ansonb which deals with the manner
of acceptance and a later passagec:

b Law of Contract (23rd Edn, 1969), p 44

'To understand the leading authority on this point, it is necessary to know that an offer made to
one who is not in immediate communication with the offeror remains open and available for
acceptance until the lapse of such a time as is prescribed by the offeror, or is reasonable as
regards the nature of the transaction. During this time the offer is a continuing offer and may be
turned into a contract by acceptance',

and the editor says it was undoubtedly necessary for the court to establish some definite rule as to the time
of a postal acceptance, and convenience pointed to the time when the letter was posted rather than to the
time when it was received by the offeror. Then he goes ond:

d Ibid, p 47

'Various attempts have been made to justify this rule analytically. One line of reasoning
attempts to eliminate any difficulties as to consensusby treating the post office as the agent of
the offeror not only for delivering the offer, but

[1973] 2 All ER 476 at 483

for receiving the notification of its acceptance; yet there is a certain artificiality in looking at the
transaction in this way. Another supposes that the offeror must be considered as making,
during every instant of the time his letter is travelling, the same identical offer to the offeree;
and then the contract is completed by the acceptance of it by the latter. But this does not
explain why posting uniquely constitutes an acceptance without notification. The better
explanation would seem to be that, if hardship is caused, as it obviously may be, by the delay
or loss of a letter of acceptance, some rule is necessary, and the rule at which the Courts have
arrived, whether or not it can logically be supported, is probably as satisfactory as any other
would be.'
 Page 9

It is to be observed that the learned author says that in the case of an offer, when all you have to do is to
accept, without being told how to accept or what you have to do, then posting is an 'acceptance without
notification'. But, of course, in all cases in contract it depends on the wording of the contract itself and in the
present case the contract requires acceptance by notification. It is quite clear from that passage, and from
the other authorities which counsel for the plaintiffs read to me, that if you have merely got an offer which
says nothing about the method of acceptance then it can be accepted by post, if that is the usual course of
dealing, and the time when the acceptance is posted is the date of the contract.

The cases which counsel for the plaintiffs cited were Henthorn v Fraser, where the headnote reads ([1892] 2
Ch at 27):

' where the circumstances under which an offer is made are such that it must have been
within the contemplation of the parties that, according to the ordinary usages of mankind, the
post might be used as a means of communicating the acceptance of it, the acceptance is
complete as soon as it is posted.'

Counsel for the plaintiffs says of course that it was within the contemplation of the parties in the present case
that the notice exercising the option should be sent by post, and so it was. But there is a difference between
the case where you have a requirement of notice in writing to be given to the intending vendor, and a case
such as Henthorn v Fraser where you have an open offer with nothing said about how it can be accepted,
and then the law, for the reasons given by Ansone, does not require notification but requires posting as being
sufficient to constitute acceptance. To the same effect was Stevenson, Jacques & Co v McLean and the
nearest case I think for counsel for the plaintiffs' purpose was Bruner v Moore, which did concern an option.
In that case there was an option to purchase certain patent rights during the period of six months from the
date of the agreement. The option said nothing as to how the option was to be exercised. In the event
Farwell J held that on the construction of that option and in the events which had then happened the option
was in fact exercised in due time, so, as counsel for the defendant pointed out, what Farwell J had to say
about acceptance is obiter. Nevertheless, of course, it is obiter to which I should pay very great attention.
Farwell J said ([1904] 1 Ch at 316):

e Law of Contract (23rd Edn, 1969), pp 46, 47

'It is now argued that this option, having expired on March 29, a telegram and letter sent on the
28, but not reaching the defendant until the 30th, were too late. In my opinion this contention
fails also, for the option was duly exercised when the telegram was sent and the letter posted.
[He then cites

[1973] 2 All ER 476 at 484

Lord Herschell in Henthorn v Fraser ([1892] 2 Ch at 33, [189194] All ER Rep at 911):] Where
the circumstances are such that it must have been within the contemplation of the parties that,
according to the ordinary usages of mankind, the post might be used as a means of
communicating the acceptance of an offer, the acceptance is complete as soon as it is posted.
In the present case the parties are American citizens staying temporarily at London hotels
when they signed the contract. That contract obviously contemplates the events that in fact
happenedthat the two parties would separate and would visit various parts of Europe, and
would communicate with one another constantly by letter and telegram. If there ever was a
case in which the parties contemplated that the post might be used as a means of
communicating on all subjects connected with the contract, this is that case. I hold, therefore,
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that the option was duly exercised.'

The authorities, particularly Bruner v Moore and two later cases of Household Fire and Carriage Accident
Insurance Co Ltd v Grant and Re Imperial Land Co of Marseilles, Harris' Case, which counsel for the
plaintiffs cited, do show that where you have an offer and no mode of acceptance is prescribed but it is to be
assumed from the circumstances that post is one of the mediums of acceptance, then you can accept
through the post, and the time of acceptance is the time of posting. But that has no relevance where the
mode of acceptance is prescribed and in the present case this option prescribes that it shall be exercisable
by notice in writing to the intending vendor. If, as I think, this means that notice must be given to the
intending vendor, then we are dealing not with the cases which counsel for the plaintiffs cites, which relate to
offer and acceptance without more; we are dealing with the question of how you are entitled to give notice to
an intending vendor, and what you have to do in order to satisfy the requirements. It seems to me from s
196, and also as a matter of construction, that the intending vendor must get the notice, and subject only to
the exemptions provided by s 196, namely that you take every possible reasonable precaution by giving it by
registered post, and the notice is not returned undelivered. But it will be noticed that, when you use the
registered post procedure, it is not the time when you hand it over to the Post Office which counts but the
time when, in the normal course of events, it ought to reach, and nearly always does reach, the addressee.
Accordingly, I do not think the cases which counsel for the plaintiffs cited are relevant here and in my
judgment the notice had to be received by the defendant, and it clearly was not received.

Counsel for the plaintiffs had an alternative point. He tried to add together the letter which had been sent to
the vendor's solicitor and the oral communication made by the vendor's solicitor to the vendor, and he said:
'Well, there you are'. This, I think, is a plea ad misericordiam. Counsel for the plaintiffs is saying: 'Well,
suppose the notice did not reach the defendant, he knew that there was something like it with his solicitor'.
But it is conceded that service on the solicitor is not good enough, and in my judgment what happened was
this, that the defendant, before the expiry of the period knew that the plaintiffs wanted to exercise the option
and he knew that the plaintiffs were trying to exercise the option, but that is all. He was hoping that they
would not exercise the option, and the onus was clearly on them to exercise it, and they did not.

I was referred to Hare v Nicoll, which for present purposes merely repeats the rule that, an option being a
species of privilege for the benefit of the party on whom it is conferred, it is for that party to comply strictly
with the conditions stipulated for the exercise of the option.
[1973] 2 All ER 476 at 485

Finally counsel for the plaintiffs gave an appeal to the merits. Of course I do not really know where the merits
lie, but assume that they do lie with the plaintiffs, and assume that it was rough luck on them that they did not
get their option exercised in due time, nevertheless counsel for the plaintiffs is only trying to persuade me to
make bad law out of a hard case. There is no real difficulty. The option agreement says what is to be done,
namely, that notice in writing has to be served on the intending vendor. Section 196 gives perfectly plain and
alternative methods of doing this. If that is not thought to be sufficient the notice can, of course, be delivered
by hand and there was plenty of time. But if the person serving the notice goes outside s 196 he does so at
his own peril. I must have regard simply to this, that in my judgment the notice had to be served on the
defendant either by hand or in one of the manners authorised by s 196 or in some other manner. It was not
in fact served on him and accordingly the option was not exercised.

The result must be that I dismiss this action, with costs.

Action dismissed.

Solicitors: Brecher & Co (for the plaintiffs); Bulcraig & Davis (for the defendant).
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Jacqueline Metcalfe Barrister.