1

TABLE OF CONTENTS

DECLARATION…………………………………………………………………..

CERTIFICATION………………………………………………………………...

DEDICATION……………………………………………………………………..

ACKNOWLEDGEMENT……………………………………………………........

TABLE OF CASES………………………………………………………………..

TABLE OF STATUTES…………………………………………………………..

LIST OF ABBREVIATIONS…………………………………………………….

ABSTRACT………………………………………………………………………..

CHAPTER 1: GENERAL INTRODUCTION

1.1 Background of the Study

1.2 Statement of the Problem

1.3 Research Questions

1.4 Objectives of the Study

1.5 Scope of the Study

1.6 Research Methodology

1.7 Significance of the Study

 2

CHAPTER 2: FORMATION OF AN ELECTRONIC SALE

AGREEMENT

2.1 Introduction

2.2 Definition of Contract of Sale of Goods

2.3 Essential Elements of an Electronic Sale Contract

2.3.1 Offer and Invitation to Treat

2.3.2 Acceptance and Communication of Acceptance

2.3.3 Intention to Create Legal Relation

CHAPTER 3: SALES OF GOODS ACT: HISTORY AND SCOPE

3.1 Introduction to the Sales of Goods Act

3.2 Historical Development of the Sales of Goods Act

3.3 Scope and Applicability of the Sales of Goods Act in Nigeria

CHAPTER 4: LEGAL CHALLENGES ARISING FROM THE

APPLICATION OF THE SALES OF GOODS ACT TO ELECTRONIC
SALES

4.1 Jurisdictional Challenges in Electronic Sales

4.2 Applicability of Sales of Goods Law to Intangible Goods in E-commerce

4.3 Issues of Acceptance and Communication in Electronic Sales

4.4 Consumer Protection and Implied Terms in Electronic Sales

CHAPTER 5: SUMMARY, CONCLUSION, AND RECOMMENDATIONS

 3

5.1 Summary of Findings

5.2 Conclusion

5.3 Recommendation

CHAPTER 1: GENERAL INTRODUCTION

1.1 Background of the Study

The Sales of Goods Act, which plays a seminal role in Nigeria's commercial law

framework, has its historical origins rooted in the United Kingdom. Initially

enacted as the Sale of Goods Act 1893 in the UK, this foundational legislation was

later substantially revised and consolidated as the Sale of Goods Act 1979 1. As a

common law country, Nigeria adopted and integrated the Sales of Goods Act into

its legal system during the colonial era. The Sale of Goods Act 2, which is a direct

adoption of the UK's Sale of Goods Act 1893, as it exists in Nigeria, has undergone

a transformative evolution as a critical component of the country's commercial law.

Additionally, the Sales of Goods Act applies across the entire nation, including the

Federal Capital Territory3. The Sales of Goods Act in Nigeria serves to regulate the

sale of goods and protect consumer rights. It defines seller obligations, including

1
The Sale of Goods Act 1979 consolidates the Sale of Goods Act 1893. The primary source of
law of sale of goods in the former territories of the British Empire and Commonwealth is the
English Sale of Goods Act 1893 (Canada is an exception which has adopted hybrid legislation
incorporating elements of the United States Uniform Commercial Code). In Nigeria, it has
been held to be a statue of general application and so applicable in the country. See Lawal vs.
Younan (1961), All N.L.R.245 at 255.
2
Sale of Goods Act (Cap S10, Laws of the Federation of Nigeria 2004)
3
The Sale of Goods Law in the Southern States of Nigeria is a verbatim reproduction of the 1893
Act. States in the northern Nigeria have their Sales of Goods Law with some variations.
 4

delivering goods of satisfactory quality and as described 4. It also provides a legal

framework for resolving disputes arising from the sale of goods.

With the evolution of technology and the increasing prevalence of electronic

transactions, the Nigerian legal system has adeptly incorporated electronic

commerce into the purview of the Sales of Goods Act, ensuring its continued

relevance in the digital age. The Sales of Goods Act regulates electronic

transactions in Nigeria insofar as they involve the sale of tangible goods. Under the

Act, a contract of sale is defined as "a contract whereby the seller transfers or

agrees to transfer the property in goods to the buyer for a money consideration,

called the price5." This definition encompasses both traditional face-to-face sales

and sales conducted through electronic means, as long as they involve tangible

goods. Furthermore, the Act outlines the key elements required for a valid contract

of sale, including an offer, acceptance, and consideration 6. These elements are

equally applicable to electronic sales, where parties may exchange electronic

communications to form a contract. Therefore, the general principles of contract

formation under the Sales of Goods Act can be extended to electronic transactions

as well.

4
Section 12-14 of the Act
5
Section 1, Sales of Goods Act.
6
Section 2.
 5

Moreover, the Act imposes certain implied terms on all agreements of sale,

whether offline or electronic. For instance, Section 12 states that there is an implied

condition that the seller has the right to sell the goods at the time of sale. This

implies that in an electronic transaction, the seller must possess legal ownership or

authority to sell the goods being offered. Additionally, the Act implies a condition

that the goods sold are of satisfactory quality, fit for their intended purpose, and

correspond with their description7. These implied terms are particularly relevant in

the context of electronic sales, where consumers cannot physically inspect the

goods before purchase and rely heavily on product descriptions and representations

provided by the seller.

Despite the adaptability of the Sales of Goods Act to electronic sales, certain

challenges emerge when applying traditional sales law to the dynamic digital

marketplace. For instance, the issue of jurisdiction can become intricate when

parties involved in an electronic sale are located in different regions or countries. It

is also problematic when it comes to determining the jurisdiction of the court to

enforce electronic agreements. It is trite law that parties have the right to set out the

laws to guide their agreement. In the absence of such agreement and where the

buyer and the seller are domiciled in two different countries, the question becomes

which law should guide them?

7
Section 14.
 6

Furthermore, electronic transactions may involve intangible goods, such as

software, digital downloads, or virtual assets. These intangible goods may not fit

neatly into the traditional understanding of tangible goods under the Act. As a

result, defining the scope and applicability of the Sales of Goods Act to such

intangible goods necessitates careful legal consideration and adaptation. A

noteworthy precedent shedding light on this matter is the case of St Albans City

and District Council v International Computers Ltd.8 In this case, the English

Court of Appeal deliberated on a situation involving the transfer of computer

software stored on a computer disk. The Court emphasized that while software

itself may not be classified as a 'good,' the computer disk containing the software

could indeed be regarded as a 'good' within the context of the Sale of Goods Act.

The Court's assertion was that if the computer disk, along with the embedded

software, were to be sold or leased by the computer manufacturer and subsequently

found to be defective, there would be a prima facie breach of the implied terms

concerning quality and fitness for purpose as stipulated by the Sales of Goods Act.
9
This illustrates the complexity involved in determining the legal status of

intangible goods and highlights the necessity for a careful and nuanced approach in

interpreting and applying the Act to such transactions.

8
[1997] FSR 251
9
Ibid 226.
 7

Additionally, the notion of "acceptance" in electronic transactions can be subject to

interpretation and contention. The lack of direct human interaction may lead to

disputes regarding when and how acceptance occurs in the digital realm. Clarifying

the rules and standards for acceptance becomes vital to ensure the smooth

functioning of electronic sales while upholding the principles of the Sales of Goods

Act.

The Sales of Goods Act in Nigeria has evolved from its historical roots in the

United Kingdom to encompass electronic sales in the contemporary digital

marketplace. While the Act provides a solid foundation for regulating electronic

transactions involving tangible goods, challenges persist in adapting traditional

sales law to the intricacies of e-commerce.

1.1Statement of the Problem

The Nigerian legal system is rooted in common law principles and statutes that

were developed long before the advent of e-commerce. As such, there is a growing

concern about the adequacy and applicability of traditional laws like the Sales of

Goods Act in governing electronic sales transactions. The lack of specific

legislation tailored to electronic sales and the absence of clear legal guidelines may

lead to uncertainties, disputes, and inadequate protection for both consumers and

businesses involved in e-commerce transactions. Therefore, this research seeks to

 8

assess the relevance of the Sales of Goods Act to electronic sales in Nigeria and

explore potential areas of improvement or reform.

1.3 Research Questions

1. What are the provisions of the Sales of Goods Act in Nigeria?

2. What are the legal challenges arising from the application of the Sales of Goods

Act to electronic sales?

3. How relevant and effective is the Sales of Goods Act in regulating electronic

sales transactions in Nigeria?

4. What recommendations can be proposed for potential reforms or new

legislation to address the legal issues arising from electronic sales?

1.4 Objectives of the Study

The primary objectives of this research are as follows:

1. To examine the provisions of the Sales of Goods Act in Nigeria.

2. To identify the legal challenges arising from the application of the Sales of

Goods Act to electronic sales.

3. To assess the relevance and effectiveness of the Sales of Goods Act in

regulating electronic sales transactions in Nigeria.

4. To propose recommendations for potential reforms or new legislation to address

the legal issues arising from electronic sales.

 9

1.5 Scope of the Study

This study focuses specifically on the relevance of the Sales of Goods Act to

electronic sales in Nigeria. It will analyze the provisions of the Sales of Goods Act

and consider their applicability and effectiveness in regulating e-commerce

transactions. The study will not delve into other areas of electronic commerce law,

such as data protection, cybercrime, or intellectual property, as these topics require

separate and comprehensive research.

1.6 Research Methodology

This research will adopt a qualitative research design with a doctrinal approach.

The qualitative research design will allow for an in-depth exploration and analysis

of the legal aspects concerning the relevance of the Sales of Goods Law to

electronic sales in Nigeria. The doctrinal approach will primarily rely on the

examination of existing legal texts, case law, and scholarly literature to provide a

comprehensive understanding of the subject matter.

1.7 Significance of the Study

The findings of this research will have significant implications for various

stakeholders involved in electronic sales in Nigeria. For lawmakers and legal

 10

practitioners, it will provide insights into the adequacy of the existing legal

framework and highlight areas that require attention and reform. Businesses

engaged in e-commerce will gain a better understanding of their rights and

obligations under the Sales of Goods Act and be able to adapt their practices

accordingly. Consumers, on the other hand, will benefit from a more robust legal

framework that ensures fair treatment and adequate protection in their electronic

transactions.

1.8 Definition of Terms

Electronic Sales: Refers to transactions involving the buying and selling of goods
through electronic means, primarily over the internet, using digital platforms,
websites, or electronic communication methods10.

E-commerce: The practice of buying and selling goods and services over the
internet, typically involving electronic payment methods and digital
communication.

Goods: Goods which are the subject of sale have been defined to include: “all
chattels personal other than things in action and money and includes emblements,
industrial growing crops, and things attached to and forming part of the land which
are agreed to be severed before sale or contract under sale”11

Contract: A contract is an agreement between two or more parties which creates a

reciprocal legal obligation to do or not to do a particular thing.12

10
E. O. Ezike, Nigerian Contract Law, (London: LexisNexis, 2015), p. 446.
11
P. Atiyah, Sale of Goods 9th ed. By John Adams ( London, Pitman Publishing,1995).
12
Orient Bank (Nig.) Plc v. Bilante International Ltd [1997] 8 NWLR (Pt 515) 37 at 76.
 11

Contract of sale of goods: Contract of sale of goods is defined under the Law as a
contract where the seller transfers or agrees to transfer the property in goods to the
buyer for a money consideration called price. 13 The effect of this narrow definition
is that an article of sale which does not come within the purview of this definition
cannot be considered as a contract of sale.

Offer: An offer is a definite undertaking or promise made by one party with the

intention that it shall become binding on the party making it as soon as it is

accepted by the party to whom it was addressed.14

Acceptance: It is a final and unqualified expression of assent to the terms of an

offer.15 For any contract to be valid, acceptance must be manifested in a positive

way, either by words, in writing or by electronic means, such as e- mail, SMS, or

by conduct.

Consideration: It is something of value given by both parties to a contract that

induces them to enter into the agreement to exchange mutual performance. 16

Invitation to Treat: An invitation to treat is a mere declaration of willingness to

enter into negotiation; it is not an offer, and cannot be accepted so as to form a

binding contract.17
13
Section 3(1) Sale of Goods Law Lagos State 2003. This excludes, Mortgages, pledge and
other forms of security.
14
I. E. Sagay, Nigerian Law of Contract, (Ibadan: Spectrum Books Ltd., 2007), p. 10.
15
Daspan v. Mangu Local Government Council [2013] 2 NWLR (Pt 1338) 203 at 233, para. D.
16
Nwachukwu v. Okaelu [2015] LPELR-24276 (CA).
17
Clashfern and Lord Mackay, Halsbury’s Laws of England, Vol. 9(1) (London: Butterworths,
1998), p.
463.
 12

Intention to Create Legal Relationship: This is a concept used in contract law to

denote whether a court should presume that parties to an agreement wish it to be

enforceable at law. The court seeks evidence that the parties to the agreement

intended that it should be governed by, and subject to, the law of contract; so that

the agreement gives rise to legal consequences.

1.9 Literature Review

This section intends to comprehensively review scholarly works by multiple

eminent writers who have extensively addressed the subject matter. The writings

under scrutiny encompass an array of legal materials and academic publications

that pertain to the domain of the sales of goods law and its implications on

electronic sales in law.

Adam18 in his article article acknowledges the inherent inadequacies of Nigeria's

sales of goods law in the context of e-commerce or internet transactions. However,

it is crucial to note that the views presented in the article might now be outdated,

given that they were based on the Evidence Act of 2004, which rendered

electronically generated evidence inadmissible. To perform a comprehensive

assessment of the relevance of the sales of goods law to electronic sales in Nigeria,

a critical consideration of the current legal framework is imperative, particularly in

18
K. I. Adam, “E-Commerce: Issues and Challenges for the Nigeria Law”, University of Ilorin
Law.
 13

light of the subsequent enactment of the Evidence Act of 2011, which permits the

admissibility of electronically generated evidence. One pertinent legal suggestion

is to review and update the sales of goods law to align it with the provisions of the

Evidence Act of 2011, thus accommodating and regulating electronic transactions

effectively.

Aniaka19 in her article commends the Electronic Transaction Bill passed by

Nigeria's National Assembly in 2015 for its endeavor to enhance the benefits of

electronic transactions and address certain legitimate concerns pertaining to e-

commerce. However, the article astutely highlights a notable omission in the Bill,

namely its failure to address issues relating to non-delivery of goods that have been

duly paid for. A thorough analysis of the relevance of the sales of goods law to

electronic sales in Nigeria necessitates an examination of how the Electronic

Transaction Bill complements the existing legal framework and addresses

challenges pertaining to goods delivery and payment disputes in electronic

commerce. To address this concern, it would be necessary to consider amending

the Electronic Transaction Bill to include robust provisions that protect consumers'

interests in cases of non-delivery of goods and provide clear guidelines for dispute

resolution mechanisms in electronic transactions.

19
O. Aniaka, “Analyzing the Adequacy of Electronic Transaction Bill 2015 in Facilitating E-
commerce in
Nigeria”, available at http://ssrn.com/abstract=2651120 (accessed 22nd July, 2023).
 14

Bamodu20 in his article provides an extensive analysis of electronic agreements,

including their formation and admissibility under the Evidence Act of 2011, as

well as the significance of the Electronic Transaction Bill of 2015. However, the

article is critiqued for not adequately addressing certain inadequacies and potential

gaps that the Bill, if enacted, might create. Moreover, it does not fully explore

issues related to acceptance in electronic agreements. To perform a comprehensive

evaluation of the relevance of the sales of goods law to electronic sales in Nigeria,

it is imperative to scrutinize how the Electronic Transaction Bill impacts the

formation and enforcement of electronic agreements and whether it effectively

addresses any potential gaps or challenges that may arise. A comprehensive review

of the Electronic Transaction Bill to ensure that it addresses the identified

inadequacies, provides clarity on acceptance mechanisms for electronic

agreements, and aligns harmoniously with the existing legal framework is hereby

deemed very necessary.

Kazeem21 in his book extensively examines electronic agreements as a catalyst for

the growth of electronic commerce in Nigeria. However, it is essential to

acknowledge that the book predates the enactment of the Evidence Act of 2011,

20
G. Bamodu, “Information Communication Technology and E-Commerce: Challenges and
Opportunities for Nigerian Legal System and Judiciary”, Journal of Information Law &
Technology (JILT), Vol. 2 (2004), available at
http://www2.warwick.ac.uk/fac/soc/law/elj/jilt/2004_2/bamodu/ (accessed 22nd July, 2023).
21
M. A. Kazeem, Electronic Contracts Formation and the Nigerian Initiatives, (Nigeria: s.n.,
2005), pp. 1-82.
 15

and thus its views may be limited to a legal landscape where electronically

generated evidence was not admissible. To conduct a thorough analysis of the

relevance of the sales of goods law to electronic sales in Nigeria, it is crucial to

rely on updated legal sources that consider the current legal framework, including

the admissibility of electronically generated evidence.

Akomolede22 in his article highlights the ongoing regulatory efforts concerning e-

commerce activities in Nigeria, which are currently at the stage of draft bills before

the National Assembly. The article recommends the establishment of a regulatory

framework and appropriate institutions to monitor electronic commerce in the

country. To comprehensively assess the relevance of the sales of goods law to

electronic sales in Nigeria, it is essential to evaluate how the proposed regulatory

framework aligns with the existing sales of goods law and whether it effectively

addresses specific challenges unique to electronic transactions. It is advisable to

ensure that the draft bills progress into comprehensive electronic commerce

regulations that encompass consumer protection measures, address contract

formation, and establish clear mechanisms for dispute resolution. Additionally, the

establishment of a specialized regulatory body dedicated to overseeing e-

commerce activities can facilitate effective enforcement of relevant laws and

regulations.
22
T. I. Akomolede, “Contemporary Legal issues in Electronic Commerce in Nigeria”,
Potchefstroom Electronic Law Journal, Vol. 11 No 3, (2008), pp. 2-25.
 16

CHAPTER 2: FORMATION OF AN ELECTRONIC SALE AGREEMENT

2.1 Introduction

"Electronic sale agreements" refers to agreements or contracts for the sale of goods

or services that are conducted electronically, typically through digital platforms,

online marketplaces, or e-commerce websites. The importance of sales of goods

law in relation to electronic sales in Nigeria remains unchanged, as agreements

formed through electronic interfaces hold legal implications 23. In the context of

electronic transactions, the traditional principles of contract law still apply 24. These

essential elements, such as offer, acceptance, consideration, capacity to contract,

and intention to create legal relations, are crucial for validating and enforcing

23
Forrest v. Verizon Communications Inc., 805 A 2d 1007 (DC App 2002).
24
E. O. Ezike, Nigerian Contract Law, (London: LexisNexis, 2015), p, 81.
 17

electronic agreements25. This chapter will thoroughly explore how these

fundamental elements are relevant and significant in the context of electronic sales

in Nigeria.

2.2 Definition of Contract of Sale of Goods

A contract of sale is not only the contract whereby goods are ‘transferred’ for a

price but may also be an ‘agreement’ to transfer goods for a price at some later

time or under some particular term or condition. Thus, ‘sale’ and ‘agreement to

sell’ are agreements of sale. The distinction between them however is importance

because in a ‘sale’ the title to the goods and risk in the goods can pass upon

making the contract. While in the ‘agreement’ to sell, the title and risk pass at some

later time.

The United Kingdom Sale of Goods Act26 defines contract of sale as ‘A contract by

which the seller transfers or agrees to transfer the property in goods to the buyer

for a money consideration, called the price.’ 27 A distinction is then made between a

‘sale’ and ‘an agreement to sell’. The Act reads:28

Where under a contract of sale the property in the goods is

transferred from the seller to the buyer, the contract is called a sale.
25
I. E. Sagay, Nigerian Law of Contract, (Ibadan: Spectrum Books Ltd., 2007), p. 8.
26
Sale of Good Act 1979 whose ancestor the sale of Goods Act, 1893 is the father of sale of Goods Acts
throughout the English speaking world (thereafter referred to as SGA 1979)
27
ibid, S.2(1).
28
ibid, S.2(4) (5) (6).
 18

Where under a contract of sale the transfer of property in the goods

is to take place at a future time or subject to some condition later to
be fulfilled, the contract is called an agreement to sell.

An agreement to sell becomes a sale when the time lapse or the conditions are

fulfilled subject to which the property in the goods is to be transferred.

The American Uniform Commercial Code29 also distinguishes between a ‘contract

for sale’, a ‘present sale’ a contract to sell goods at a future time and sale. The

Code reads30:

Contract for sale includes both a present sale of goods and contract to
sell goods at a future time. A ‘sale’ consists in the passing of title
from the seller to the buyer for a price. A ‘present sale’ means a sale
which is accomplished by the making of the contract.

The French Civil Law31 also makes the distinction between sale and agreement to

sell but not in precise terms as the Common Law statutes. The Law reads: 32

Sale is an agreement by which one party obliges himself to

deliver a thing the other obliges himself to pay for it. It is
perfected between the parties and the property is acquired by
the purchaser as regard the seller; as soon as they have agreed
on the thing and the price, although the thing be not yet
delivered or the price paid. The promise of sale constitutes a
sale where there is a reciprocal consent by both parties as to the
thing and as to the price.
29
Uniform Commercial Code, 1972 official text.
30
Ibid, S.2-106.
31
The civil Code of France was adopted in 1804.
32
Ibid, Art 1583 and 1589.
 19

2.3 Essential Elements of an Electronic Sale Agreement

In the realm of electronic commerce, the formation of electronic agreements for the

sale of goods has become a commonplace practice. Such agreements are

established through digital platforms, websites, or mobile applications, enabling

buyers and sellers to conduct transactions in a virtual environment. The

determination of the precise moment when a contract comes into existence in the

realm of electronic sales has been a challenging and contentious issue. The

emergence of electronic medium as an additional means of entering into a contract

other than a traditional paper medium has not altered the fundamental prerequisites

for establishing a valid and binding agreement 33. Instead, it has introduced a new

dimension, offering parties involved in a contract for sale of Goods the choice

between a traditional paper-based medium or the modern electronic medium.

2.3.1 Offer and Invitation to Treat

An offer is a proposition made by one party (offeror) to another (offeree)

indicating his willingness to be contractually bound on certain terms provided that

those terms are accepted by the other party 34. An offer may be made expressly or

33
T. I. Akomolede,“Contemporary Legal issues in Electronic Commerce in Nigeria”,
Potchefstroom Electronic Law Journal, Vol. 11 No 3, (2008), pp. 2-25.
34
Agoma v. Guinness (Nig.) Plc [1995] 2 NWLR (Pt 580) 672; United Bank of Africa v.
Tejumola & Sons (Nig.) Ltd [1988] 2 NWLR (Pt 79) 662.
 20

implied from the conduct of the parties. It may be made to a particular person or in

some cases, to the public at large.35 On the other hand, an invitation to treat is

merely a preliminary move in negotiations, which may lead to a contract. An

invitation to treat precedes an offer in the contract formation process; it is an

invitation to make an offer.36

The major distinction between an offer and an invitation to treat is that for an offer

to be capable of becoming binding on acceptance, it must be definitely clear and

final. If it is a merely preliminary move in negotiations which may lead to a

contract, it is not an offer but an invitation to treat. 37 As Bowen, L. J. stated, a

person making an offer becomes liable to anyone who, before it is retracted,

performs the condition, whereas by contrast, in invitations to treat, the offeror

offers to negotiate, or issues advertisements that he has got a stock of books to sell,

or house to let, in which case there is no offer to be bound by any contract. Such

advertisements are offers to negotiate, offer to receive offers or offer to chaffer.38

35
Carlill v. Carbolic Smoke Ball [1893] 1 QB 256: The court held that the advertisement was not
a contract with the world but a unilateral offer and that any one that performs the terms of the
offer brings himself into a contractual relationship with the defendant.
36
Augustine Abba v. Shell Petroleum Development Company of Nigeria Ltd [2013] LPELR –
20338 (SC).
37
The offeror must not merely have been feeling his way towards an agreement, not merely
initiating negotiations from which an agreement might or might not in time result.
38
Carlill v. Carbolic Smoke Ball [1893] 1 QB 256, Note 12.
 21

The description of goods in a web page advertisement should be regarded as an

invitation to treat and not an offer. 39 The general principle is that adverts or display

of products do not constitute an offer. The argument has also been made that a

website is not offering physical goods for sale, and as such it is difficult to accept

that supplies can be exhausted, because digital products supplied on the Internet

are infinite in supply.40 The special nature of electronic transactions has made most

of the offline contract law rules applicable to commercial agreements inapplicable

to such transactions.41

2.3.2 Acceptance and Communication of Acceptance

An acceptance is an unequivocal final expression by the offeree that he agrees to

the terms of the offer as conveyed to him by the offeror. 42 By acceptance of the

offer, a contract is said to come into existence as it underscores the bilateral nature

of a contract. If an offer is important then the acceptance is doubly important

because it is that act that seals the formation of the contract and creates the

consensus ad idem.43

39
UN Convention on the Use of Electronic Communication in the International Contracts 2005,
Art. 11: Display of goods on the websites constitute an invitation to treat.
40
G. J. H. Smith, Internet Law and Regulation, (3rd edn, London: Sweet and Maxwell, 2002), p.
451.
41
C. Gringas and N. Nabarro, The Laws of the Internet, (London: Butterworths, 1977), p. 15
42
Metibaye v. Narelli International Ltd [2009] 16 NWLR (Pt 1167) 326.
43
M. A. Kazeem, Electronic Contracts Formation and the Nigerian Initiatives, (Nigeria: s.n.,
2005), p. 7.
 22

An important element of acceptance is that it must be communicated to the

offeror. Silence does not constitute acceptance. 44 Acceptance must be manifested in

a positive way, either by words, in writing or by electronic means, such as e-mail,

SMS or by conduct.45 As a general rule a mere intention to accept does not

constitute an acceptance.46 Where the mode of acceptance is not prescribed the

mode of acceptance will depend on the offer and the surrounding circumstances. 47

However, where the offeror has prescribed the mode of acceptance but does not

insist on that mode, the rule at common law is that the offeree can accept by any

mode that is either as fast as or faster than the mode prescribed. Where the offeree

adopts another mode of acceptance, he must be prepared to bear the risk of his

acceptance not arriving as fast as it would have been if he had followed the mode

prescribed.48

It is true that acceptance need not be express but can be implied from the conduct

of the offeree. But with regard to electronic agreements, there must be some

unequivocal act that confirms that terms have been accepted. In short, it is

fundamental that an offeror of goods on the Internet should state expressly how
44
Felthouse v. Bindley [1862] 142 ER 1037.
45
Cooperative Development Bank Plc v. Arc Mfon Ekanem [2009] 16 NWLR (Pt 1168) 585.
46
See the case of Nigerian National Supply v. Agricor Incorporation of U.S.A [1994] 3 NWLR (Pt
332) 339.
47
Ezike, above, note 9, chap. 1, p. 66: an offer made by telegram or, more so, a prepaid telegram,
raises a presumption that a quick reply is desired. If the offeree communicates his acceptance
promptly, for example by courier, telephone, fax, e-mail or telex, the communication is effective.
48
Afolabi v. Polymera Industries Ltd [1967] 1 ALL NLR 144.
 23

acceptance should be made and if not done, other forms of communication will not

be valid.49

The key issue as regards acceptance on the Internet is when it is deemed to have

been effectively communicated to the other party to create a binding contract. As

regards the issue of effective communication of acceptance, there are two

competing rules that could be relevant to businesses on the Internet. They are:

1. The first one is the postal rule, which in essence states that an acceptance is

effective once it is posted, rather than when it is received. 50 The rationale for

this rule has been expounded in a number of cases 51 and it is to the effect that

since both parties have entrusted their communication to an independent third

medium then they should be both bound by the efficiency or inefficiency of the

medium.

2. The other applicable rule is the instantaneous rule, which in essence is that the

acceptance is only effective when received by the other party. 52 This rule is not
49
This is consistent with the thinking of the 39th Session of the UNCITRAL Working Group on
Electronic Contracts where they agreed that whatever rules devised to govern electronic
contracting must allow parties to determine clearly when a contract is concluded.
50
This rule has been described as a strange beast, which seems to exist only in common law
jurisdictions. This is true because in America this rule is also operational and is called the
"mailbox rule". The rule may have however been watered by a number of cases which would
indicate that acceptance is effective only when delivered. Such cases include but not limited to
Rhode Island Tool Co v. U.S F Supp 417 [1955] and Dick v. U.S F Supp 326 [1949].
51
Adams v. Lindsell (1818) l B & A 681; Household Fire insurance v. Grant (1879) 4 E & D
216.
52
Entores Limited v. Miles Far East Corporation (1955) 2 All ER 493: Where Parke L J noted
that parties are in each other’s presence or, though separated in space communication between
them is in effect instantaneous, there is no need for any such rule of convenience".
 24

without its own share of controversy because the question does arise on whether

communication via the Internet is instantaneous or not. It has been argued that

because of the often circumlocutions routes which messages take over the

Internet; communication cannot be deemed analogous to the telex or telephone

systems and the instantaneous rule should not apply.53

In Nigeria both rules are equally applicable and the instantaneous rule has been

given judicial approval in a number of cases 54 which establish that an offer must be

accepted especially by the person to whom the offer is directed and in so accepting,

that person must comply strictly with the terms of the offer. This would mean that

Nigerian law would also recognize and enforce modes of acceptance stipulated by

agreements to be formed over the Internet especially where the requirements of full

disclosure of terms and conditions have been complied with.

The postal rule is also applicable in Nigeria and would therefore be fully applicable

to contract formation over the Internet especially where both parties have not

specified any mode of acceptance and are using same service providers. 55 It is
53
G. J. H. Smith, Internet Law and Regulation, (3rd edn, London: Sweet and Maxwell, 2002), p.
454.
54
College of Medicine v. Adegbite [1973] 5 SC. 149, at p. 163; Majekodunmi v. N.B.N [1978] 3
SC 119 at pp. 126-127.
55
Sagay, above, note 16, chap. 1, p. 47-48: where the learned author dismissed the suggestion that
the Nigerian position on acceptance by post differs, in that Section 3 of the Post Office Act
which provides that acceptance by post does not take effect until the letter of acceptance is
delivered to the offeror or his agent. The learned author noted that the provision was specifically
meant to define the liability of the Post Office for loss of or damage to postal articles and what is
being stated in the section is that the liability of the Post Office does not arise until the article is
in the course of transmission, and ends with delivery. He therefore concluded that it does not
 25

important to point out briefly that consideration, just as in traditional agreements,

is also a vital element in the formation of electronic agreements. The promises to

pay over the Internet are enough to form the consideration to create a contract; in

the same way as such promises would lead to enforceable agreements in normal

commercial transactions.56

2.3.3 Intention to Create Legal Relation

The presence of contractual intention is very important in e-commerce, because

more often than not only one human being is involved in the communication, with

programmed computers or machines at the other side. Agreements can be made

with machines, and it is of no legal consequence that a machine physically

completed the contract.57 This means that there is human intention to create legal

relations in the computer transactions. The Evidence Act 201158 provides that:

the court may presume that an electronic message forwarded

by the originator through an electronic mail server to the
addressee to whom the message purports to be addressed
corresponds with the message as fed into his computer for

purport to lay down any rules governing the formation of a contract between private individuals
who happen to use post as a carrier.
56
T. I. Akomolede, “Contemporary Legal issues in Electronic Commerce in Nigeria”,
Potchefstroom Electronic Law Journal, Vol. 11 No 3, (2008), pp. 2-25.
57
Thornton v. Shoe Lane Parking [1971] 2 QB 163; Edwards v. Skyview [1964] 1 WLR 399;
State Farm Mutual Auto. Ins. Co. v. Bockhurst 453 F. 2d 533 [10th Cir. 1972]: The court held
that the computer operates only in accordance with the information and directions supplied by its
programmers.
58
S. 153 (2).
 26

transmission; but the court shall not make any presumption

as to the person to whom such message was sent.
The effect of this provision is that where an offer is sent by e-mail, actual receipt in

the exact form sent is required for a contract to result. It follows then that in

determining the intention of the sender (offeror) in an electronic contract, the e-

mail sent and the one received must be one and the same.

Again, there is some controversy as to the validity of offers and acceptance by

computer in situations where there is no human involvement because of the issue

of the existence of contractual intention.59 As the practice of concluding

agreements electronically grows and evolves, this is another interesting issue that

the courts are likely to encounter at some point in the future. A contract is of

course regarded as requiring a meeting of the minds (consensus ad idem) of the

parties concerned although of course the law has long recognised the ability to

enter into agreements through agents (qui facit per alium facit per se) but that

recognition was traditionally limited to agency capacity by human beings or

recognised juridical persons such as companies and so on, and can be extended to

computers.60

59
F. Ukwueze & U. Obuka, “Legal Framework for the Regulation of Electronic Frauds in
Nigeria”, Law and Policy Review, Vol. 2 (2011), p. 75 at p. 90.
60
G. Bamodu, “Information Communication Technology and E-Commerce: Challenges and
Opportunities for Nigerian Legal System and Judiciary”, Journal of Information Law &
Technology (JILT), Vol. 2 (2004), available at
th
http://www2.warwick.ac.uk/fac/soc/law/elj/jilt/2004_2/bamodu/ (last accessed 24 July, 2023.).
 27

In the United States, the possibility of contracting through electronic agents is now

legally recognised. In the first place, the Uniform Computer Information

Transactions Act (UCITA) 1999 defines an electronic agent as ‘a computer

program, or electronic or other automated means used independently to initiate an

action or respond to electronic messages or performances without a review or

action by an individual at the time of the action, response or performance.’ 61 The

Act then goes on to provide rules for attributing the actions of an electronic agent.

Thus, section 107 of UCITA provides that a person that uses an electronic agent

that it has selected for making an authentication, performance, or agreement,

including manifestation of assent, is bound by the operations of the electronic

agent, even if no individual was aware of or reviewed the agent’s operations or the

results of the operations. These are matters that will have to be addressed by future

e-commerce legislation in Nigeria but it is believed that Nigerian’s common law is

sufficiently flexible to be suitably adapted by the courts if an action on such a point

arises in litigation before such legislation is enacted. 62 In most cases the courts look

objectively into the circumstances of each case to determine whether a contract has

61
Uniform Computer Information Transactions Act (UCITA) 1999, s. 102.
62
G. Bamodu, “Information Communication Technology and E-Commerce: Challenges and
Opportunities for Nigerian Legal System and Judiciary”, Journal of Information Law &
Technology (JILT), Vol. 2 (2004), available at
th
http://www2.warwick.ac.uk/fac/soc/law/elj/jilt/2004_2/bamodu/ (last accessed 24 July, 2023
 28

been made or not. Thus, in determining the requisite intention the court applies an

objective test as against a subjective one.63

63
Smith v. Hughes [1871] LR 6 QB 597.