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CMA Foundation · Fundamentals of Business Laws and Business Communication · Performance of Contracts

Sunil agrees to deliver 50 machine parts to Deepak at Deepak's factory on 10 June. Sunil arrives at the factory at 11 pm on 10 June, when it is closed and no one is present, and leaves the parts at the gate. Next day Deepak refuses to treat this as delivery. Which view is correct under Section 38?

The offer is invalid because it was not made at a proper time and under circumstances giving Deepak a reasonable opportunity to see that Sunil was able and willing to perform fully there and then. Merely leaving parts at a closed factory on the due date does not satisfy Section 38.

  1. AThe offer is valid, because it was made on the due date
  2. BThe offer is invalid, because it was not made at a proper time and in circumstances allowing a reasonable opportunity to ascertain ability and willingness to performCorrect
  3. CThe offer is invalid, only because the number of parts was not stated in writing
  4. DThe offer is valid, because Deepak refused it later

Explanation

Section 38(2) requires the offer to be made at a proper time and place and in circumstances where the promisee can reasonably ascertain that the promisor is able and willing there and then to perform fully. A late-night drop at a closed factory gives no such opportunity. Being on the due date alone is not enough, and Deepak's later refusal does not cure the defect.

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