DATE DOWNLOADED: Tue Mar 24 23:50:50 2020

SOURCE: Content Downloaded from HeinOnline

Citations:

Bluebook 20th ed.

Siobhan Cummiskey, The Effect of the Electronic Commerce Act 2000 on the Operation of
the Postal Rule, 1 IBLQ 1 (2006).

ALWD 6th ed.

Siobhan Cummiskey, The Effect of the Electronic Commerce Act 2000 on the Operation of
the Postal Rule, 1 IBLQ 1 (2006).

APA 6th ed.

Cummiskey, S. (2006). The effect of the electronic commerce act 2000 on the operation
of the postal rule. Irish Business Law Quarterly, 1(4), 1-4.

Chicago 7th ed.

Siobhan Cummiskey, "The Effect of the Electronic Commerce Act 2000 on the Operation
of the Postal Rule," Irish Business Law Quarterly 1, no. 4 (2006): 1-4

McGill Guide 9th ed.

Siobhan Cummiskey, "The Effect of the Electronic Commerce Act 2000 on the Operation
of the Postal Rule" (2006) 1:4 Irish Bus L Q 1.

MLA 8th ed.

Cummiskey, Siobhan. "The Effect of the Electronic Commerce Act 2000 on the Operation
of the Postal Rule." Irish Business Law Quarterly, vol. 1, no. 4, 2006, p. 1-4.
HeinOnline.

OSCOLA 4th ed.

Siobhan Cummiskey, 'The Effect of the Electronic Commerce Act 2000 on the Operation
of the Postal Rule' (2006) 1 IBLQ 1

Provided by:
Available Through: National Law University Odisha

-- Your use of this HeinOnline PDF indicates your acceptance of HeinOnline's Terms and
Conditions of the license agreement available at
https://heinonline.org/HOL/License
-- The search text of this PDF is generated from uncorrected OCR text.
-- To obtain permission to use this article beyond the scope of your license, please use:
Copyright Information
The emergence of e-mail as a widely used mode of the area of
offer and acceptance and the application of communication in
the formation of contracts has unsettled the receipt and postal
rules in contract law. The Electronic Commerce Act 20001 was
introduced to bring some clarity to electronic commerce.
However, the Act was not introduced with the intent of
settling this area of contract law and does not specifically
address the issue of e-mail and the postal rule. With little in
the way of academic guidance and a dearth of jurisprudence
in this area, the effect of the Act remains a question of debate.
The Electronic Commerce Act 2000 partly transposed
Ireland's obligations under the Electronic Commerce and the
Electronic Signature Directives. 2 It dealt with a number of
issues in relation to the formation of contracts by e-mail. It
has been noted that since its commencement there has been
little case law applying the postal rule to electronic mail and
it remains an "open question". There are two possible views:
firstly, the Act has potentially affected the postal rule's
application to e-mail and the construction of the legislation by
the court will determine this; secondly, (and more likely) the
Act has not affected the operation of the postal rule and it is
open to the courts to apply or refuse to apply the postal rule
on the basis of the similarities or differences between the two
modes of communication.
E-mail and the Postal Rule
Under the postal rule, where both parties anticipate that
acceptance will take place by post, a contract is concluded
when the offeree posts a letter of acceptance. This is in
contrast to the receipt rule ordinarily used in the context of
offer and acceptance. The postal rule was established in
England in Adams v Lindsell 4 and accepted by the Irish courts
in the 1919 case of Sanderson v Cunningham.s The rule is still
considered to be good law in Ireland, as evidenced by the
statements of the Supreme Court in the case of Kelly v Cruise
CateringLtd 6 wherein the Court declared that "there were no
circumstances which justified any divergence from the well
established rule". 7
The courts have previously considered that instantaneous
modes of communication are never subject to the postal rule. 8
Contrary to popular opinion, e-mail is not an instantaneous
form of communication; it operates through an intermediary
- an Internet Service Provider ("ISP"). It is therefore not a
mode of communication that automatically falls outside of the
postal rule.9
a) Section 2 I:'sent' and 'received"'
There is a general statement at section 21(1) that an e-mail is
taken to have been sent when it enters the first information
system subsequent to its generation. Under the postal rule,
this would be the point at which the acceptance took place,
regardless of whether or not the e-mail ever reached the
'inbox' of the intended recipient, or was read. In terms of its
conceptual arrangement section 21(1) resemblances the
postal system, where post passes through that system before
reaching the addressee. If the postal rule is not applicable or
is dislodged by this sub-section, it would not matter when the
e-mail was sent, only when it was received. It might be
inferred here that the section was drafted with the postal rule
in mind.
Under section 21(2), if a recipient has designated an
information system (by indicating an e-mail address), the
e-mail is taken to have been received when it enters the

No 27 of 2000. Hereafter referred to as 'the Act'.

2 Mullany, "Legal Aspects of Electronic Contracts in Ireland" December 2000 E-Journal 10 at 10.
' Mullany, "Legal Aspects of Electronic Contracts in Ireland" December 2000 E-Journal 10 at 11.
(1818) 1 B. & Ald. 681.
1t1919] 2 IR 234.
6 11994] 2 ILRM 394.

11994] 2 ILRM 394.

Entores Ltd. v Miles Far East Corp. t1955] 2 QB 327.
Web-contracting is different and is deemed instantaneous (eg: the "click-wrap" or "submit" system). For more on this see Haigh Contract Law in an
E-Commerce Age (Round Hall Sweet and Maxwell: Dublin) 2001, pp. 30-31.
'o Section 21(1) Where an electronic communication enters an information system, or the first information system, outside the control of the originator, then,
unless otherwise agreed between the originator and the addressee, it is taken to have been sent when it enters such information system or first information system.

Volume 1 * Issue 4
recipient's inbox unopened. This may be assimilated to the
rules regarding instantaneous modes of communication. The
Brinkibon v Stahag Stahl and Stahlwarenhandelsgesellschaft
MBH" case indicates that the time of arrival of an
instantaneous communication is the expected not the actual
time of arrival. For example, during office hours or times
when the parties are normally in communication is the actual
time of arrival, if outside these hours then at opening of
business the next day.1 2 The receipt rule therefore may
naturally apply to e-mail when the information system is
designated (address provided). Accordingly, the receipt rule
appears to apply neatly to this sub-section.
Section 21(3) states that if no information system is
designated (no address provided), the communication is
taken to have been received when it is read. This is consistent
with the logic behind the postal rule. According to the postal
rule, the parties must "intend that acceptance is to be
communicated by post"" before the postal rule will apply. If
no information system is designated (no address provided) it
may be stated that it is not intended that acceptance will take
place by e-mail. The Act therefore appears to follow the rules
regarding avoidance of the postal rule, whereby it dictates
that the postal rule will only apply where both parties
contemplate that acceptance will take place by post. This
might be interpreted as acknowledgment of the application of
the postal rule to this sub-section.
4
b) Section 20: request for a receipt'1
Section 20 (the request for a receipt) is analogous to a
situation where parties to a contract being formed by post
stipulate certain terms with regard to offer and acceptance
that successfully dislodge the postal rule. Nanin Holdings
Property v Tullamarine Estates Property 's was an example
of this situation where the use of the words: "upon receipt
by us of an identical contract" successfully dislodged the
postal rule. This section therefore appears to apply the
postal rule and the rules regarding the avoidance of its
application.
c) Absence of Intention to Affect the Postal Rule: Lack
of exlicit reference to 'offer' and 'acceptance'
The Act does not explicitly mention the terms 'offer' or
,acceptance' in sections 20 and 21. The Oireachtas did not
state whether the postal rule should apply in the context of
e-mails. It is possible to argue that, given the likely
application of the Act to contractual relations, the legislature
deliberately did not make an assertion with regard to the rule
to be applied. It is important to note that the Act does not use
the language of contract law but that of electronic commerce.
While it clearly states that an electronic communication,
where a 'designated information system' (address) is
supplied, is not sent until it reaches that 'designated
information system' (address) it is silent as to the
consequences if that communication is an acceptance. As
Clark notes "[n]either the Electronic Commerce Act 2000 or
the Electronic Commerce Regulations address the question
whether the message transmitted is an offer or an acceptance:
the neutral phrases order and acknowledgment are not
6
necessarily synonymous with offer and acceptance."
Similarly, the English Parliament refrained from taking the
opportunity to settle the relationship of e-mail to the postal
7
rule in the Electronic Commerce Directive in its jurisdiction.'
The United Nations Commission on International Trade
Law ("UNCITRAL") in its Model Law on Electronic
Commerce 18 and the Electronic Commerce Directive,' also
refrains from using the language of contract law.
This is in marked contrast to the Vienna Convention on
Contracts for the International Sale of Goods (1980), which
states that "[a]n acceptance of an offer becomes effective the
moment the indication of assent reaches the offeror". 2 0 This
clearly follows the receipt rule and addresses the issue of the
formation of contracts by e-mail directly by using the
language of offer and acceptance. Similarly, the American Bar
Association Model Agreement on Electronic Data Interchange
(s 2.1) and the Restatement (Second) of Contracts (s 63) both
expressly indicate that the postal rule does not apply to
electronic communications .21

(2) Where the addressee of an electronic communication has designated an information system for the purpose of receiving electronic communications, then,
unless otherwise agreed between the originator and the addressee or the law otherwise provides, the electronic communication is taken to have been received
when it enters that information system.
(3) Where the addressee of an electronic communication has not designated an information system for the purpose of receiving electronic communications,
then, unless otherwise agreed between the originator and the addressee, the electronic communication is taken to have been received when it comes to the
attention of the addressee.
" Brinkibon v Stahag Stahl and StahlwarenhandelsgesellschaftMBH t1983] 2 AC 34, wherein the House of Lords confirmed the rule in Entores, on substantially
identical facts noting that this holding may need to be varied for other methods of communication such as fax machines and now e-mail.
12 Haigh Contract Law in an E-Commerce Age (Round Hall Sweet and Maxwell: Dublin) 2001, pp. 29-30.
13 Clark Contract Law in Ireland (Thomson Round Hall: Dublin) 5th ed., 2004, p. 20.
" 20-(2) Where the originator of an electronic communication indicates that receipt of the electronic communication is required to be acknowledged, the
electronic communication, in relation to the establishing of legal rights and obligations between parties, shall, until the acknowledgement is received by the
originator and unless the parties otherwise agree, be treated as if it had never been sent.
(3) Where the originator of an electronic communication has indicated that receipt of the electronic communication is required to be acknowledged but
has not stated that the electronic communication is conditional on the receipt of acknowledgement and the acknowledgement has not been received by
the originator within the time specified or agreed or, if no time has been specified or agreed, within a reasonable time, then the electronic communication,
in relation to the establishing of legal rights and obligations between parties, shall, unless the parties otherwise agree, be treated as if it had never been
sent.
1 11994] 1 VR 74.
16 Clark Contract Law in Ireland (Thomson Round Hall: Dublin) 5th ed., 2004, p. 25.
17 Capps, "Electronic Mail and the Postal Rule" (2004) I.C.C.L.R. 15(7) 207 at 211.
* Section 15.1, United Nations Commission on International Trade Law, "Model Law on Electronic Commerce" 1996.
1 Section 11(2)(b), Electronic Commerce (EC Directive) Regulations 2002 (SI 2002/2013) contains a rule similar to that found in section 21.2 of the Irish Act.
20 Article 18(2) as quoted in Dickie, "When and Where are Electronic Contracts Concluded?" (1998) 49 NILQ 332 at 332.

Volume 1 * Issue 4
d) Absence of Intention to Affect the Postal Rule:
Consistency with the Current Law
The Electronic Commerce Act 2000 appears to have
deliberately chosen to remain consistent with the current law.
Section 11(d) states that the Consumer Credit Act 1995 22 and
the European Communities (Unfair Terms in Consumer
Contracts) Regulations, 1995,23 among others, are unaffected
by the legislation. Section 20(1) of the Electronic Commerce
Act 2000 states that it is "subject to any other law". Although
of no interpretative force or effect, the words of the Minister
for Enterprise upon the introduction of this Bill to the Seanad
are instructive: "the principles and objectives of our laws
apply equally to the on-line and off-line world ... In this way
the legislation is not intended to introduce an entirely new
legal framework but rather it is intended to be enabling
legislation". 2 4 Clearly the question of whether the Minister
achieved his stated aim is one that can only be answered by
the courts. In reference to section 20 in particular, it is said:
"This section is not intended to deal with the legal
consequences that flow from sending an acknowledgment of
receipt apart from establishing the fact of receipt of the
electronic communication. There is a clear distinction
there."25
Suitablity of the Postal Rule to E-mail
(a) Extension of the rule
"The postal rule has not been extended to any other form
of communication other than post and telegram so why
would it extend here?"26 This question relates to whether or
not e-mail is a sufficiently comparable mode of
communication to post. Whether or not the Act affects the
postal rule is a question of construction. This construction is
likely to focus not on the words of the legislation, as these
appear to be neutral, but on the nature of e-mail as a mode of
communication in the formation of a contract.
(b) Control
E-mail is a mode of communication that bears much
resemblance to the post. Certainly the similarities are clear.
An e-mail when sent enters an ISP (i.e. the 'outbox' of an
e-mail program) which then distributes it to the intended
recipient (the addressee). A letter when sent enters the postal
system which then distributes it to the intended recipient.
This may be assimilated to the concept of 'control' in the
postal rule. Control in the context of the postal rule was
examined in the case of Household Fire Insurance Co Ltd v
Grant.2 7 Thesiger L.J. stated that "the acceptor, in posting the
letter has ... put it out of control and done an extraneous act
which clenches the matter".2 8 The sender has "done all that is
reasonable to get the letter of acceptance to the offeror".2 9 The
law appears to favour the person who "trusts the post". 0 This
is a basis upon which the postal rule was founded and it
applies equally to the sending of e-mails. Many things can
happen to an e-mail after it has been sent, it may become
unreadable, lost, blocked by a firewall and so on. It is
submitted that this does not render e-mail sufficiently similar
to instantaneous modes of communication to apply the
receipt rule.
c) Receipt
As with post, there is no guarantee that the person to whom
the e-mail is sent, will read the communication, even if it
reaches them. Receiving a 'read and receive' receipt does not
mean the intended recipient has read the e-mail.3 ' Equally,
there is no immediate or guaranteed feedback with regard to
the status of a sent e-mail for the sender unless the service is
configured so as to give notification.32
d) Speed
It has been opined that if speed of communication is be the
deciding factor for the correct application of the postal rule,
then an e-mailed acceptance should be covered by the postal
rule. Some users still only connect to the internet
sporadically using a dial-up connection. Haigh states that
together the Brinkibon 34 and Schelde as cases indicate that the
time of arrival of an instantaneous communication is the
expected not the actual time of arrival. For example, during
office hours or times when the parties are normally in
communication is the actual time of arrival, if outside these
hours then at opening of business the next day. 6 These rules
appear suitable to e-mail communications.
Conclusions and Recommendations
Under the postal rule, acceptance is communicated once the
letter leaves the control of the offeree and enters the control
of the postal system. Under the Act, an e-mail is sent once it
leaves the information system of the offeree and enters the

21 Dickie, -When and Where are Electronic Contracts Concluded?" (1998) 49 NILQ 332 at 333.
22 No.24 of 1999.
23 SI 27 of 1995.
24 Minister for Public Enterprise Mrs O'Rourke - Seanad Debates Tues, 18 April 2000 http://www.gov.ie/debates-00/sl4april/sn140400.pdf.
25 Minister for Public Enterprise Mrs O'Rourke - Seanad Debates Tues, 18 April 2000 http://www.gov.ie/debates-00/sl4april/sn140400.pdf.
26 Dickie, "When and Where are Electronic Contracts Concluded?" (1998) 49 NILQ 332 at 332.
27 (1879) LR 4 Ex 216.
28 (1879) LR 4 Ex 216.
29 Capps, "Electronic Mail and the Postal Rule" (2004) I.C.C.L.R. 15(7) 207 at 209.
3o Capps, "Electronic Mail and the Postal Rule" (2004) I.C.C.L.R. 15(7) 207 at 211.
31 Merely that an electronic receipt has been generated. Haigh Contract Law in an E-Commerce Age (Round Hall Sweet and Maxwell: Dublin) 2001, p. 29.
32 Haigh Contract Law in an E-Commerce Age (Round Hall Sweet and Maxwell: Dublin) 2001, p.
28.
3 Capps, "Electronic Mail and the Postal Rule" (2004) I.C.C.L.R. 15(7) 207 at 209.
3 Brinkibon v Stahag Stahl und Stahlwarenhandelsgesellschaft MBH t1983] 2 AC 34, wherein the House of Lords confirmed the rule in Entores,
on
substantially identical facts noting that this holding may need to be varied for other methods of communication such as fax machines and now e-mail.
3 Schelde Delta Shipping B.V v Astarte Shipping B.V (the Pamela) t1995] 2 Lloyd's Rep 249.
36 Haigh Contract Law in an E-Commerce Age (Round Hall Sweet and Maxwell: Dublin) 2001, pp. 29-30.

Volume 1 * Issue 4
first information system of the offeror. If the postal rule
applies to e-mail, therefore, the time of communication of
acceptance would appear to be the time the e-mail leaves the
information system of the offeree and enters the first
information system, as defined by the Act.
If the postal rule does not apply, acceptance is
communicated once it is received ie: when it enters the inbox
of the offeror, if they have designated an information system,
or once it comes to their attention if they have not designated
an information system.
If the offeror requests acknowledgment of receipt and
communication is conditional upon such acknowledgment,
the communication is not sent until the acknowledgment is
received, or, if it is not conditional upon acknowledgment, it
will simply expire after a reasonable amount of time.
Until the issue of e-mail and the postal rule receives judicial
attention, it is advised that the parties to an electronic
contract expressly stipulate the exact procedure required for
Volume 1 * Issue 4
the formulation of the contract. While the Electronic
Commerce Act 2000 offers some clarification in this area, it
appears to be the case that the drafters of the Act had no
intention of affecting the current law. This may be deduced
from the fact that the Act neither refers to the postal rule nor
uses the language of contract law. Whether the postal rule
applies to e-mail is therefore a matter of construction of this
relatively new mode of communication. There exist some
similarities between e-mail and the post, such as the use of an
intermediary (the postal system/an ISP) however, the
extension of the postal rule to other forms of communication
has been limited, applying only to telegrams and post. It is
probable therefore that the issue of the postal rule and
contracts entered into by e-mail will be resolved when the
courts examine electronic mail as a mode of communication
so as to compare it to the postal system and thereby
determine whether the postal rule should be extended to
electronic mail.