1. An offer lapses after stipulated or reasonable time. An offer lapses if acceptance is not communicated within the time prescribed in the offer, or if no time is prescribed, within a reasonable time. [sec. 6 (2)]. What is a reasonable time is a question of fact depending upon the circumstances of each case. for example, an offer made by telegram suggests that a reply is required urgently and if the offeree delays the communication of his acceptance even by a day or two, the offer will be considered to have lapsed.
2. An offer lapses by not being accepted in the mode prescribed, or if no made is prescribed, in some usual and reasonable manner. But, according to section 7, if the offeree does not accept the offer according to the mode prescribed, the offer does not accept the offer according to the mode prescribed, the offer does not lapse automatically. It is for the offeror to insist that his proposal shall be accepted only in the prescribed offeror to insist that his proposal shall be accepted only in the prescribed manner, and if he fails to do so he is deemed to have accepted the acceptance.
3. An offer lapses by rejection. An offer lapses if it has been rejected by the offeree. The rejection may be express i.e., by words spoken or written, or implied. Implied rejection is one(a) where either the offeree makes a counter offer, or (b) where the offeree gives a conditional acceptance.
4. An offer lapses by the death or insanity of the offeror or the offeree before acceptance. If the offeror dies or becomes insane before acceptance, the offer lapsed provided that the fact of his death or insanity comes to the knowledge of the acceptor before acceptance [sec. 6 (4)]. From the language of the section, it may be inferred that an acceptance in ignorance of the death or insanity of the offeror, is a valid acceptance, and gives rise to a contract. Thus the fact of death or insanity of the offeror would not put an end to the offer until it comes to the notice of the acceptor before acceptance. An offeree’s death or insanity before accepting the offer puts an end to offer and his heirs cannot accept for him (Reynolds vs. Atherton).
5. An offer lapses by revocation. An offer is revoked when it is retracted back by the communication of notice of revocation by the offeror to the other party [sec. 6(1). For example, at an auction sale, A makes the highest bid. But he withdraws the bid before the fall of the hammer. There cannot be a concluded contract because the offer has been revoked before acceptance;
6. Revocation by non- fulfillment of a condition precedent to acceptance. An offer stand revoked if the offeree fails to fulfill a condition precedent to acceptance [sec. 6 (3)]. Thus, where A, offers to sell his scooter to B for Rs. 4,000. if B joins the lions club within a week the offer stands revoked and cannot be accepted be B if B fails to join the lions club.(in default of payment of earnest money.)
7. An offer lapses by subsequent illegality or destruction of subject matter. An offer lapses if it becomes illegal after it is made, and before it is accepted. Thus, where an offer is made to sell 10 bags of wheat for Rs. 6,500 and before it is accepted, a law prohibiting the sale of wheat by private individuals is enacted, the offer comes to an end. In the same manner, an offer may lapse if the thing, which is the subject matter of the offer, is destroyed or substantially impaired before acceptance.
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Lapse and Revocation of offer
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