Commentary on Sections
Part 1 - Formation of contract
Notification
Section 13 - When notification takes effect
61.Section 13 implements recommendations 6 to 9 of the Report and relates to when notification takes effect. The issue of when notification of statements takes effect is discussed in paragraphs 4.56 to 4.71 of the Report. Paragraphs 4.72 to 4.85 focus on when electronic communications take effect.
62.Section 13(1) provides that any notification in relation to formation of contract takes effect when it reaches the person (the addressee). The significance of a statement reaching the other party is that, in general, it only has legal effect from that point onward. Notification includes offers, acceptances, counter-offers, withdrawals, rejections, revocations and declarations (such as a declaration that an offer already made is irrevocable (see section 5)). However, by virtue of subsection (2), it is subject to section 11(1), whether within any time limit for acceptance referred to in paragraph (a) or a reasonable time referred to in paragraph (b).
63.Section 13(3) provides that a notification reaches its addressee when the notification is made available to that person in such circumstances as make it reasonable to expect the person to be able to obtain access to it without undue delay. This is a broad and flexible test which enables contracting parties to deliver notifications to each other in the way which suits their needs best.
64.Section 13(4) gives instances of when reaching occurs in commonly encountered situations. These are illustrative of rather than additional to the general rule of section 13(3).
65.One instance is a notification transmitted by electronic means (section 13(4)(d)), which is to be taken to reach a person when it becomes available to be accessed by the person (recommendation 9). The provision focuses on the accessibility to the addressee as the test of legal effectiveness, in order to avoid some of the technical difficulties that may arise from the nature of electronic communications (for example, delays and failures in the transmission of emails between servers). With regard to a notification made by email, however, an appropriately worded, automatically generated out-of-office response may make it unreasonable under section 13(3) to expect the addressee to be able to obtain access to it without delay. The same applies where an electronic communications system generates an automatic message advising of a notification’s non-delivery in the addressee’s system.
66.By virtue of section 1 parties can contract out of any or all of these rules. This leaves it open to parties to make alternative provision, for example requiring the use of read receipts to emails, or something similar if they chose.
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