Mactier's Administrators v. Frith

6 Wend. 103 · Court for the Trial of Impeachments and Correction of Errors · 1830

Facts

Frith and Mactier were partners in a brandy importation venture. Frith, residing in Jacmel, offered to sell his interest in the brandy to Mactier, residing in New-York, via a letter dated December 24, 1822. Mactier replied on January 17, 1823, stating he would delay a decision until he heard from Frith again, but would accept the offer "at once" if a war between France and Spain occurred, which he anticipated. On March 13, Mactier informed Frith that war was "inevitable." The brandy arrived in New-York on March 15. On March 25/31, Mactier wrote to Frith, stating he had decided to take the adventure to his own account due to the war probability and credited Frith's account. Mactier died on April 10, 1823, before Frith received Mactier's final acceptance letter.

Issue

Was a valid contract for the sale of brandy formed between Frith and Mactier before Mactier's death? Specifically, when does an acceptance of an offer become binding when parties are at a distance and one dies before the other is notified of the acceptance?

Holding

Yes, a valid contract was formed between Frith and Mactier before Mactier's death. Mactier's acceptance of Frith's offer, communicated by letter and by crediting Frith's account, completed the bargain while the offer was still open.

Rule

A contract is formed when there is a "meeting of the minds" (aggregatio mentium) on a distinct proposition, made manifest by overt acts. When parties are at a distance and negotiate by letter, an acceptance is complete and the contract is binding when the offeree dispatches a letter announcing consent, provided the offer is still standing. The offeror's knowledge of the acceptance is not an essential ingredient for contract formation; the obligation attaches to both parties at the moment of acceptance. An offer remains open until expressly revoked or until circumstances authorize a presumption of revocation, and the offeror's subsequent actions can confirm its continuance. The doctrine of relation cannot supply a non-existent party to a contract.

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