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ACCA Applied Skills · Corporate and Business Law (Global) · Introduction to the UN Convention on Contracts for the International Sale of Goods and ICC Incoterms

Galdor Ltd (State G) emails Hanse GmbH (State H), both CISG contracting states, an offer to sell goods, stating the offer lapses in five days. The email was sent at 10:00 on Monday. Hanse sends a late acceptance that reaches Galdor on Saturday. Galdor immediately tells Hanse by email, on Saturday, that it treats the acceptance as effective. What is the position under the CISG?

A contract exists. Under the CISG a late acceptance remains effective if the offeror, without delay, tells the offeree or sends notice that it treats the acceptance as effective. Galdor did this on the day it received the acceptance.

  1. ANo contract, because a late acceptance is always ineffective
  2. BA contract exists, because the offeror promptly informed the offeree that the late acceptance is effectiveCorrect
  3. CA contract exists only if Hanse had relied on the offer
  4. DNo contract unless the acceptance is confirmed in writing signed by both parties

Explanation

Under the CISG a late acceptance is still effective as an acceptance if the offeror without delay orally informs the offeree to that effect or dispatches a notice to that effect. Galdor did so on the day it received it. Saying a late acceptance is always ineffective ignores this rule.

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