476 All England Law Reports [1973] 2 All ER fact of the matter is that this strip is worth more to the defendants than the pounds, shillings and pence which they ‘will receive by indemnity, even on a 1973 bai. Accordingly, in my judgment, that argument is not sufficient to overturn all the other arguments in favour of the defendants, and I decline to order rectification of the register. Summons dismissed. Solicitors: Vigards (for the plaintiffs); Piesse éx Sons (for the defendants), Jacqueline Metcalfe Barrister. Holwell Securities Ltd v Hughes CHANCERY DIVISION ‘TEMPLEMAN J Ast, 2nd MARCH 1973 Contract - Offer and acceptance — Acceptance by post - Mode of acceptance prescribed — Notice in writing to offeror ~ Option - Option to purchase freehold property - Notice - Option ‘exercisable by notice in writing to’ vendor within prescribed period - Purchaser writing letter to vendor giving notice of exercise of option - Letter sent by ordinary post - Letter never delivered to vendor - Whether option validly exercised ~ Law of Property Act 1925, $ 196. e By cl x of an agreement dated roth October 1971 made between the defendant of the one part and the plaintiffs of the other, the plaintiffs were granted an option to purchase certain freehold property from the defendant. Clause 2 of the agreement provided: “The said option shall be exercisable by notice in writing to the [defendant] at any time within six months from the date hereof” On x4th April 1972 the plaintiffs’ f solicitors wrote a letter to the defendant giving notice of the exercise of the option. The letter was posted, properly addressed and prepaid, on rath April, bucit was never in fact delivered to the defendant or to his address. In an action against the defendant seeking specific performance of the option agreement, the plaintiffs contended that, since a contractual offer could be accepted by posting a letter of acceptance, the time of acceptance being the moment of posting, the option had been g validly exercised when their letter of 14th April was posted. Held - Since the agreement prescribed the mode in which it was to be exercised, it followed that it could only be exercised in the prescribed way, ie by serving notice on the defendant, either by delivering it to him by hand or in one of the ways author- ised by s 196? of the Law of Property Act 1925. The mere posting of the notice could @ Section 196, so far as material, provides: “@) Any notice required or authorised by this Act to be served shall be sufficiently served if it is left at the last-known place uf abode or business in the United Kingdom of the... . person to be served... “G@ Any notice required or authorised by this Act to be served shall also be sufficiently served, if i is sent by post in a registered letter addressed to the... person to be served, / by name, at the aforesaid place of abode or business... and if that letter is not returned through the post-office undelivered; and that service shall be deemed to be made at the time at which the registered letter would in the ordinary course be delivered. “(3) The provisions of this section shall extend to notices required to be served by any instrument affecting property executed or coming ino operation after the commencement of this Act unless a contrary intention appears.> ChD Holwell Securities v Hughes (Templeman J) 477 not constitute a valid exercise of the option (see p 480 ¢, p 481 @, p 482, p 484 to fand P 485 b, post). Henthorn v Fraser [1891-94] All ER Rep 908, Bruner v Moore [1904] x Ch 305, Household Fire and Carriage Accident Insurance Co Ltd v Grant (1879) 4 Ex D 216 and Re Imperial Land Co of Marseilles (1872) 7 Ch App 587 distinguished. Notes For contracts made through the post, see 8 Halsbury's Laws (3rd Edn) 78-80, paras 134-139, and for cases on the subject, see 12 Digest (Repl) 96-100, 484-525. For the Law of Property Act 1925, 196, see 27 Halsbury’s Statutes (3rd Edn) 617. Cases referred to in judgment Berkeley Road (88), London NWo, Re, Rickwood v Turnsek [1971] x All ER 254, [1971] Ch 648, [1971] 2 WLR 307. Bruner v Moore [1904] 1 Ch 305, 73 LJCh 377, 89 LT 738, 12 Digest (Reissue) 99, 516. Hare v Nicoll [1966] 1 All ER 285, [1966] 2 QB 130, [1966] 2 WLR 4at, CA, Digest( Cont Vol B) 665, 3004. Henthorn v Fraser [1892] 2 Ch 27, [1891-94] All ER Rep 908, 61 LJCh 373, 66 LT 439, CA, 12 Digest (Reissue) 74, 383. Holt v Heatherfield Trust Ltd [1942] t All ER 404, [1942] 2 KB 1, 111 LJKB 465, 166 LT 2st, 8 Digest (Repl) 597, 406. Household Fire and Carriage Accident Insurance Co Ltd v Grant (1879) 4 Ex D 216, 48 LIQB 577, 41 LT 298, 44 JP 152, CA, 12 Digest (Reissue) 81, 420. Imperial Land Co of Marseilles, eH Harris’ Case (1872) 7 Ch App 587, 41 LJCh 621, 26 LT 781, 12 Digest (Reissue) 97, Stevenson, Jacques &x Co v McLean Gite) 5 QBD 346, 49 LJQB 701, 42 LT 897, 12 Digest Reissue) 71, 363. Case also cited Entores Ltd v Miles Far East Corpn [1955] 2 All ER 493, [1955] 2 QB 327, CA. Action ‘This was an action commenced by writ issued on 4th July 1972 by the plaintiffs, Hol- well Securities Led, ageinse the defendant, Thomas Flare Hughes, secking performance of an agreement for the sale by the defendant to the plaintiffs of property known as 575 High Road, Wembley, and registered at HM Land Registry with absolute frechold title under title no NGL 10503 at the price of £45,000 such agreement being constituted by an option agreement made in writing and for value on roth October 1971 between the plaintifis and the defendant and exercise of the option by notice in ‘wniting to the defendant dated rath April 1972. Further or alternatively, the plaintiffs claimed damages for breach of contract. ‘The defendant denied that the option had been validly exercised. The facts are set out in the judgment. W A Macpherson QC and Hubert Picarda for the plaintiffs. Frank Whitworth QC and Roger Ellis for the defendant. 'TEMPLEMAN J. This is a purchaser's specific performance action based on a written option agreement. The defence is that in the circumstances which I shall narrate the option was not validly exercised. ‘The option agreement was dated 19th October 1971 and made between the defen- dant, Dr Hughes (called ‘the intending vendor’, of the one part, and the plaintiffs, Holwell Securities Ltd (called ‘the intending purchaser’), of the other part. Clause 1 wanted the option to purchase the property known as 571 High Road, Wembley, Shhich was registered af the Land Registry with absolute tide. "Those premises, 571 High Road, Wembley, were the residence of the defendant and also the place where he478 All England Law Reports [1973] 2 All ER carried on his practice as a general medical practitioner. Clause 2 dealt with the exercise of the option and was in these terms: “Tain said option shall be exercisable by notice in writing to the Intending Vendor at any time within six months from the date hereof..." By a letter dated 14th April 1972, getting near the expiry date for the option, the plaintiffs’ solicitors wrote to the defendant's solicitors. The letter read: “Re Dr. T. H. Hughes and Holwell Securities Limited, 571 High Road, Wembley. ‘We refer to our earlier correspondence regarding cur clients’ option to purchase the above property. Our clients wish to exercise their option and we shall be obliged if you would accept this letter as notice of the exercise of the option. Kindly acknowledge receipt. We enclose our clients’ cheque in your favour for the sum of £4,500, being the 1o per cent. deposit payable on the exercise of the option to be held by you as stakeholders, [Finally:] We are sending a copy of this letter to your client.’ Although cl 2 of the option agreement provided for notice in writing to the intending vendor, a different arrangement was made with regard to the deposit. Clause 3 of the ent provided that on the exercise of the option the intending purchaser ‘shall pay to the Intending Vendor's Solicitors as Stakeholders by way of deposit the sum of... £4,500’. So notice exercising the option was to go to the vendor, and the deposit was to go to the vendor's solicitors, and in this letter dated rath April 1972 the plaintffs’ solicitors purported both to exercise the option and to send the de- posit (which they did) by the letter addressed to the defendant's solicitors. That letter was delivered by hand to the defendant's solicitors in the afternoon of r4th April. ‘There is no dispute about that. But equally the plaintiffs do not contend that this solicitors’ letter was effective by itself to exercise the option. It is not contended that service on the defendant's solicitors could be sufficient. On the same day, that is to say 14th April, and about the same time, the plaintiffs’ solicitors prepared another letter. It was dated 14th April and it was addressed, on the letter, to: ‘Dr. T. H. Hughes, 571 High Road, Wembley, Middlesex. Dear Sir, Re [and then on the carbon, which is the only copy we have got, ic is left rather vague as to whether they got the number right] High Road, Wembley, Holwell Securities Limited. We enclose for your information a copy of a letter today sent to your So they did what they told the other solicitors they were going to do, namely, send a copy of the letter to the defendant. ‘That letter, the one intended for the defendant, and a copy of the letter which had been sent by hand to the solicitors were, between about 1.30 pm and 2pm on rgth April, placed in an envelope addressed it is said to the defendant and that envelope and its contents (to which I shall refer as ‘the disputed notice’) were immedi- ately placed in a post basket on the third floor of the principal offices of the plaintiffs’ solicitors. There is no direct evidence that it was ever seen again. What should have happened to the disputed notice, and what I am invited to infer in fact happened, was this: about 15 minutes after the disputed notice had been placed in the post basket, the disputed notice and any other letters were collected by a messenger from the post- room. They were taken to the post-room, a room set aside for that purpose in the plaintiffs’ solicitors’ principal offices, and in the post-room the disputed notice was franked with first-class mail postage, and the franking incorporated a print of the name of the plaintiffs’ solicitors together with a direction to deliver the envelope back to the address thus given in the event of it not being delivered to the addressee. When that franking was completed, the disputed notice and the contents of other baskets with more letters delivered from other offices belonging to the plaintiffs’ solicitors, were divided into two categories, one providing for delivery to postal addresses in the London area and the other for delivery outside London, Bundles of about 30 letters~~ ~ ChD Holwell Securities v Hughes (Templeman J) 479 were secured by a rubber band and each bundle was dropped into a Post Office mail bag. There were separate mail bags for the letters intended for the London area and for those intended for other areas, At the end of the afternoon each mail bag was fastened by string at the neck in the usual way and was taken to the street entrance to the offices, and at about 6 pm the mail bags were handed over to an employee of the Post Office, who accepted them and put them on to a Post Office van, and off went. oneal evidence from the supervisor of the postal department of the plaintiffs’ solicitors, and the chance that the disputed notice was lost on the premises of the plaintiffs’ solicitors, or that there was some failure of the systern so that the disputed notice was not in fact handed over to the Post Office representative on the evening of a4th April, is negligible and remote. The same day the defendant's solicitor, who had received his letter by hand, spoke by telephone to the defendant, and in his evidence the defendant said that he was told that the solicitor had received a letter which purported to exercise the option, but that the solicitor did not think it was a valid exercise of the option, and the defendant was told, or at least led to believe, that he could expect to receive a copy, or a similar letter—I am not giving the exact words but it is quite clear that was the general sense of what he was told. The defendant then gave evidence that he told his solicitor that he had already planned to go to Ireland because of illness in his family, and asked whether he could go. He was advised that he was under no obliga- tion to stay at home and wait for whatever came through the post or whatever mi be delivered otherwise than through the post. So the defendant then left for Ireland that evening and did not recurn to Wembley until the morning of 2oth April, by which time of course the six months limited by the option agreement for the exercise of the option had expired. In the meantime, while the defendant was away, the disputed notice having been taken and accepted by the Post Office should have been taken by van to a London sorting office at Rathbone Place, and having then been sorted for Wembley it should have been taken to the Wembley sorting office by van, and then by van and man it should have gone from the Wembley sorting office tothe defendant’s address, arriving there on Saturday 15th April providing it was correctly addressed and providing that no mistake or delay intervened. ‘As I have said, the defendant is a medical practitioner who lives and practises at 571 High Road, Wembley. He is in partnership with another doctor, a Dr Blankert, and whenever Dr Blankert is on duty and the defendant is away Dr Blankert occupies a flat on the top floor of the premises, [His Lordship considered the layout of the defendant’s house, the arrangements for receipt of mail, the evidence of the defendant and Dr Blankert and continued:) Dr Blankert was quite clear in her evidence, and the chances that the disputed notice was in fact delivered to the defendant’s address between 14th and 2oth April without her knowledge are negligible. It follows that, unless Dr Blankert is telling a pack of lies, the disputed notice was not delivered, and in this stateof the evidence I infer, and find, first, that the disputed notice was posted on r4th April, that is to say before the option expired, and posted in the sense that it was handed over to the Post Office, to some postman duly authorised to receive it and to transmit it to the defendant, and that it was properly addressed and properly posted. Secondly, I find that the disputed notice was never in fact delivered to the defendant or to his address. Counsel who appeared for the defendant submitted that even if the disputed notice had been delivered it would not have been sufficient to exercise the option because it did not, in addressing the defendant, say ‘Dear Dr Hughes, We are exer- cising the option’; it merely enclosed for his information a copy of a letter sent to his solicitors, But when one looks at that copy and finds it says, ‘Our clients wish to exer- cise their option and we shall be obliged if you would accept this letter as notice of the exercise of the option’, it seems to me that if the defendant had got that letter he480 All England Law Reports [1973] 2 All ER would have got what the option agreement says he was to get, notice in writing exercising the option. ‘The argument in this case then revolves round one point. Counsel for the plaintiffs submits that the option was exercised when the letter was posted, while counsel for the defendant submits that the option could only be exercised by delivery. It never was delivered, and thus the option was never exercised at all. I begin by disembarrassing myself as far as possible from authority and looking at the agreement. The agreement says the option shall be exercisable ‘by notice in writing to the Intended Vendor at any time within six months from the date hereof’. As a matter of construction I think that meant the notice in writing had to be given to the intending vendor, and given to him in the sense that he had got to receive it. eave out of account for the moment what would have happened if he tried to evade service or if it was delivered to his house where he lived. Leaving that out of account for a moment, as a matter of construction it seems to me this option agreement is providing that the notice shall be delivered to the vendor, and if it is not then the option is not properly exercised. turn now to see what authority has to say on the matter, and the first hint to which I refer is s 196 of the Law of Property Act 1925. That deals, in sub-s(z), with ‘Any notice required or authorised to be served or given by this Act’, and by sub-s (5) the provisions of the section— ‘shall extend to notices required to be served by any instrument affecting pro- perty executed or coming into operation after the commencement of this ‘Act unless a contrary intention appears.’ In Re 88 Berkeley Road, London NW, Rickwood v Turnsek! Plowman J decided that for the purposes of s 196 (4) there was no difference between serving a notice and giving a notice, and it seems to me that, apart altogether from sub-s (1) which talks about notices being served or given, the same principle must apply to sub-s (5) and to the option agreement. Counsel for the plaintiffs did not argue that there was any difference between an agreement which required notice in writing to the vendor and an agreement which required notice in writing to be given to the vendor. His argu- ment was that notice was given when the disputed notice was posted. Section 196 contains various directions as to how notice may be given. Subsection (3) provides: “Any notice required or authorised by this Act to be served shall be sufficiently served if itis left at the last-known place of abode or business in the United King- dom of the lessee, lessor, mortgagee, mortgagor, or other person to be served, or, in case of a notice required or authorised to be served on a lessee or mortgagor, is affixed or left for him on the land or any house or building comprised in the lease or mortgage [and so on]. ‘That gets round the difficulty which might arise, as in the present case, if the defend- ant were away in Ireland. You could leave the notice at his last known place of abode or business, which in the present case were one and the same thing. Then sub-s (4) provides: “Any notice required or authorised by this Act to be served shall also be suffi- ciently served, if it is sent by post in a registered letter addressed to the lessee, lessor, mortgagee, mortgagor, or other person to be served, by name, at the afore- said said place of abode or business, office, or counting-house, and if that letter is not returned through the post-office undelivered; and that service shall be deemed to be made at the time at which the registered letter would in the ordinary course be delivered.” I leave out the complication that we now have ‘Recorded delivery’ with another statute which provides similar machinery, but the significance of s 196 is this: it 1 [1971] 1 All ER 54, [1971] Ch 648~ chD Holwell Securities v Hughes (Templeman J) 481 assumes that when a notice is required to be served or given it must actually reach the person for whom it is intended, and there are statutory exceptions which discharge the sender of the notice from proving that it reached the person in question in cer- tain limited circumstances: first of all, if he can show that the notice was left at his house or office, and, secondly, if sent by post in a registered letter properly addressed. In that case if the registered letter is not returned undelivered then it is to be deemed to be sufficiently served, and the Act specifies that the time at which the: service is deemed to be carried out is not the time of posting but the time of normal. ‘That seems to me to be consistent only with the underlying assumption that notices which require to be served have got to reach people, and this is a conven- ient method of proving or deeming that service has in fact been carried out and that they have been reached. True, as counsel for the plaintiffs says, you are not obliged to use the Act. You can hand the notice to the addressee personally or serve it in another form altogether. But in that case, of course, you may not need and do not get the protection afforded by the Act. Counsel for the plaintiffs says that s 196 is irrelevant, it is only an extra precaution which could be used. But if he is right it is an unnecessary section. All you have got to do to serve a notice, he says, is to pop it in a pillar box. According to him if you have got to serve a notice by midnight on Friday on a gentleman living in Blackpool all you have got to do is, one minute before midnight in Brighton, to pop it in a pillar box, presumably even with a 2}p stamp, and, although it may not get there for another week afterwards, or may never get there, that is good service and is effective as at the date when it is popped into the pillar box. In my judgment, $ 196 is entirely inconsistent with that argument. Ic must be remembered that s 196 is only statutory shorthand for precedents which were commonly in use and which also therefore assumed that a notice had to be proved to be delivered at or before the required date. Counsel for the plaintiffs seeks to say there are two sorts of notices: one which he calls an initiation notice and one such as the present which he calls a completion notice. An initiation notice he describes, for example, as a notice of intention to pro- secute, or something of that sort, and he also said that notice pursuant to a clause in a lease for breaking the term of the lease was an initiation notice. His submission was that if you found a lease-break clause, then—I am not quite sure whether he said it certainly was or could well be—notice in writing required in that case had to be actually received subject to the provisions of s 196, whereas if, as in the present case, there was an option to purchase, then he says posting is good enough, and he was driven to concede that you might in one and the same lease have three clauses, a lease-break clause, a renewal clause and an option to purchase the freehold. Each clause might require notice in writing, but some of those notices could be well served by, and at the time of, popping in the pillar box; other notices would have to be served by delivery and would be served at the time when the notice was in fact received, That argument seems to me to produce a result which I should, if possible, strive to avoid. It is not entirely without significance that the plaintiffs’ solicitors, in carrying out what they obviously regarded as the only requirement of the option agreement, namely, service on the solicitors, were careful to see that the solicitors’ letter was delivered by hand well before the date when the option expired. Iwas alsoreferred to Holt v Heatherfield Trust Led}, That was a case of an assignment of a debt and under s 136 of the Law of Property Act 1925 the assignment takes effect if express notice in writing has been given to the debtor and the assignment is effectual as from the date of the notice. Atkinson J said?: "The date of [such] notice is the date of a notice which has been given to the debtor, and refers back to the express notice in writing mentioned earlier in 1 [1942] 1 All BR 404, [1942] 2 KB 1 2 [ipq2] 1 AIL ER at 408, [1942] 2 KB at 6482 All England Law Reports [1973] ? All ER the section. It is express notice in writing given to the debtor, and, in my judg- ment, the date of such notice is the date on which it is received by or on behalf of the debtor. If the notice arrives at his place of business, and he happens to be away and does nor see it personally for another day or two, I think that would be immaterial; it would be received on his behalf. It cannot be the date of the notice, because a notice might be written and dated a week before it was posted, and it would be absurd to suppose that that would be effective.’ b Of course, there was a reference to the effective date being the date of the notice and the learned judge only refers to the possibility of there being a different date on the letter-heading itself and does not refer to the possibility of the date of posting. But that is a decision in line with s 196 and in line with the view that express notice in writing, where express notice in writing has got to be given, has got to be actually delivered, subject to the provisions of s 196. ec ‘A large number of cases were cited to me but there was no authority which showed that where the parties had gone out of their way to say that notice in writing had to be given to a named person then it was sufficient merely to put the letter in the post box. Counsel for the plaintiffs referred me to the Bills of Exchange Act 1882, $ 49 (15), which provides that ‘Where a notice of dishonour is duly addressed and posted, the sender is deemed to have given due notice of dishonour, notwithstanding any miscarriage by the post office’. True, that is dealing with another subject-matter butit isimplicit in that section that unless there was something which enabled you to assume that which was in fact untrue, namely that the notice had been given, then of course you would have to prove actual notice, meaning by that service on the person con- cerned, because a deeming provision is merely saying that black shall be white. So far as bills of exchange are concerned even if the addressee has not received the notice @ he is deemed to have been given it notwithstanding any miscarriage by the Post Office. ‘That is in line with s 196 and it is significant that it is necessary to put sub-s (15) into s a 49. ‘Counsel for the plaintiffs’ main submission turns on this: he says if you look at the contract cases, offer and acceptance, right at the beginning of the law of contract, you will find that it is possible to accept an offer by putting the acceptance in the post, f and that the time for the contract is the date when the acceptance is put in the post, not the date when it is received and notwithstanding it may not be received. He says here we have an offer, and the exercise of the option by notice is the acceptance, so that it is pure contract. He cited for that proposition—which I think nobody quarrels with —a passage in Anson! which deals with the manner of acceptance and a later passage”: “To understand the leading authority on this point, it is necessary to know that an offer made to one who is not in immediate communication with the offeror remains open and available for acceptance until the lapse of such a time as is prescribed by the offeror, or is reasonable as regards the nature of the transaction, During this time the offer is a continuing offer and may be turned into a contract by acceptance’, A and the editor says it was undoubtedly necessary for the court to establish some definite rule as to the time of a postal acceptance, and convenience pointed to the time when the letter was posted rather than to the time when it was received by the offeror. Then he goes on?: “Various attempts have been made to justify this rule analytically. One line / of reasoning attempts to eliminate any difficulties as to consensus by treating the post office as the agent of the offeror not only for delivering the offer, but x Law of Contract (23rd Bdn, 1969), p 44 a Ibid, p 46 3 Ibid, p47~ CchD Holwell Securities v Hughes (Templeman J) 483 for receiving the notification of its acceptance; yet there is a certain artificiality in Jooking at the transaction in this way. Another supposes that the offerey must be considered as making, during every instant of the time his letter is travel- ling, the same identical offer to the offeree; and then the contract is completed by the acceptance of it by the latter. But this does not explain why posting uniquely constitutes an acceptance without notification. The better explanation would seem to be that, if hardship is caused, as it obviously may be, by the delay or loss of a letter of acceptance, some rule is necessary, and the rule at which the Courts have arrived, whether or not it can logically be supported, is probably as satisfactory as any other would be.’ It is to be observed that the learned author says that in the case of an offer, when all you have to do is to accept, without being told how to accept or what you have to do, then posting is an ‘acceptance without notification’. But, of course, in all cases in contract it depends on the wording of the contract itself and in the present case the contract requires acceptance by notification. It is quite clear from that passage, and from the other authorities which counsel for the plaintiffs read to me, that if you have merely got an offer which says nothing about the method of acceptance then it can be accepted by post, if that is the usual course of dealing, and the time when the acceptance is posted is the date of the contract. ‘The cases which counsel for the plaintiffs cited were Henthorn v Fraser!, where the headnote reads*: ... Where the circumstances under which an offer is made are such that it maust have been within the contemplation of the parties that, according to the ordinary usages of mankind, the post might be used as a means of communicating the acceptance of it, the acceptance is complete as soon as it is posted,’ Counsel for the plaintifis says of course that i was within the contemplation of the parties in the present case that the notice exercising the option should be sent by post, and so it was. But there is a difference between the case where you have a requirement of notice in writing to be given to the intending vendor, and a case such as Henthorn + Fraser! where you have an open offer with nothing said about how it can be accepted, and then the law, for the reasons given by Anson, does not require notification but requires posting as being sufficient to constitute acceptance. To the same effect ‘was Stevenson, Jacques & Co v McLean* and the nearest case I think for counsel for the plaintiffs’ purpose was Bruner v Moore’, which did concern an option. In that case there was an option to purchase certain patent rights during the period of six months from the date of the agreement. The option said nothing as to how the option was to be exercised, In the event Farwell J held that on the construction of that option and in the events which had then happened the option was in fact exercised in due time, so, as counsel for the defendant pointed out, what Farwell J had to say about acceptance is obiter. Nevertheless, of course, it is obiter to which I should pay very great attention. Farwell J saidS: ‘It is now argued that this option, having expired on March 29, a telegram and letter sent on the 28th, but not reaching the defendant until the goth, were too late. In my opinion this contention fails also, for the option was duly exercised when the telegram was sent and the letter posted. (He then cites [189] 2 Ch 27, [1891-94] All BR Rep 908 [189] 2 Ch at 27 ‘Law of Contract (asrd Edn, 1969), pp 46, 47 (1880) 5 QBD 346 [1904] 1 Ch 305 [1904] x Ch at 316 auaenn484 All England Law Reports [1973] 2 All ER Lord Herschel in Henthorn v Fraser}:] “Where the circumstances are such that it must have been within the contemplation of the parties that, according to the ordinary usages of mankind, the post might be used as a means of communi- cating the acceptance of an offer, the acceptanceis complete as soon asitis posted.” In the present case the parties are American citizens staying temporarily at London hotels when they signed the contract. That contract obviously conte: plates the events that in fact happened—that the two parties would separate and would visit various parts of Europe, and would communicate with one another constantly by letter and telegram. If there ever was a case in which the parties contemplated that “the post might be used as a means of communi- cating” on all subjects connected with the contract, this is that case. I hold, therefore, that the option was duly exercised.” ‘The authorities, particularly Bruner v Moore? and two later cases of Household Fire and Carriage Accident Insurance Co Ltd v Grant} and Re Imperial Land Co of Marseilles, Harris’ Case‘, which counsel for the plaintiffs cited, do show that where you have an offer and no mode of acceptance is prescribed but it is to be assumed from the circumstances that post is one of the mediums of acceptance, then you can accept through the post, and the time of acceptance is the time of posting. But that has no relevance where the mode of acceptance is prescribed and in the present case this option prescribes that it shall be exercisable by notice in writing to the intending vendor. If, as I think, this means that notice must be given to the intending vendor, then we are dealing not with the cases which counsel for the plaintiffs cites, which relate to offer and acceptance without more; we are dealing with the question of how you are entitled to give notice to an intending vendor, and what you have to do in order to satisfy the requirements. It seems to me from s 196, and also as a matter of construction, that the intending vendor must get the notice, and subject only to the exemptions provided by s 196, namely that you take every possible reason- able rution by giving it by registered post, and the notice is not returned undeli- |. But it will be noticed that, when you use the registered post procedure, it is not nor the time when you hand it over to the Post Office which counts but the time when, in the normal course of events, it ought to reach, and nearly always does reach, the addressee. Accordingly, I do not think the cases which counsel for the plaintiffs cited are relevant here and in my judgment the notice had to be received by the defendant, and it clearly was not received. Counsel for the plaintiffs had an alternative point. He tried to add together the letter which had been sent to the vendor's solicitor and the oral communication made by the vendor's solicitor to the vendor, and he said: ‘Well, there you are’. ‘This, I think, is a plea ad misericordiam. Counsel for the plaintiffs is saying: ‘Well, suppose the notice did not reach the defendant, he knew that there was something like it with his solicitor’. But it is conceded that service on the solicitor is not good enough, and in my judgment what happened was this, that the defendant, before the expiry of the period knew that the plaintiffs wanted to exercise the option and he knew that the plaintiffs were trying to exercise the option, but that is all. He was hoping that they would not exercise the option, and the onus was clearly on them to exercise it, and they did not. ‘Iwas referred to Hare v Nicoll5, which for purposes merely repeats the rule that, an option being a species of privilege for the benefit of the party on whom it is conferred, it is for that party to comply strictly with the conditions stipulated for the exercise of the option. I ‘i pda [1891-94] All ER Rep at 91x 2 [1904] 1 Ch 3 Gir) 4x D 206 4 (1872) 7 Ch App 587 3 [1966] x All ER 285, [1966] 2 QB 130° ChD Holwell Securities v Hughes (Templeman J) 485 Finally counsel for the plaintiffs gave an appeal to the merits. Of course I do not really know where the merits lie, but assume that they do lie with the plaintiffs, and assume that it was rough luck on them that they did not get their option exercised in due time, nevertheless counsel for the plaintiffs is only trying to persuade me to make bad law out of a hard case. ‘There is no real difficulty. ‘The option agreement says what is to be done, namely, that notice in writing has to be served on the intend- ing vendor. Section 196 gives perfectly plain and alternative methods of doing this. If that is nor thought to be sufficient the notice can, of course, be delivered by hand and there was plenty of time. But if the person serving the notice goes outside 8 196 he does so at his own peril. I must have regard simply to this, that in my judgment the notice had to be served on the defendant either by hand or in one of the manners authorised by s 196 or in some other manner. It was not in fact served on him and accordingly the option was not exercised. The result must be that I dismiss this action, with costs. Action dismissed. Solicitors: Brecher & Co (for the plaintiffs); Bulcralg & Davis (for the defendant). Jacqueline Metcalfe Barrister. Tarmac Roadstone Holdings Ltd v Peacock and others COURT OF APPEAL, CIVIL DIVISION LORD DENNING MR, STAMP AND JAMES LJ 26th, 27th FEBRUARY 1973 Employment - Redundancy ~ Payment ~ Amount ~ Normal working hours - Overtime ~ Em- ployee entitled to overtime pay -Contract fixing minimum number of working hours ~ ‘Minimum number of working hours exceeding number of working hours without overtime — Contract guaranteeing employment for 40 hours a week at basic hourly rate~ Contract obliging employee to work overtime when required by employer - Employer not obliged to provide overtime work— Employee regularly working 57 hour week- Whether contract ‘ng minimum number of working bo hours in excess of number of hours without overtime ~ wether normal working hours 57 hours a week - Contracts of Employment Act 1963, = 2, para 1 (1), (2). Under the provisions of his contract of employment the employee was guaranteed employment for 40 hours each week for which he was paid a basic hourly rate. He could, however, be required by his employers to work overtime, for which he was paid at overtime rates, In practice the employee regularly worked 57 hours a week and sometimes more. Eventually the employee was dismissed by reason of redundancy and claimed that the redundancy payment to which he was entitled under the Redundancy Payments Act 1965 was to be calculated on the basis that his ‘normal working hours’ were, by virtue of para 1% of Sch 2. to the Contracts of Employment Act 1963, to be taken as 57 hours a week since he was contractually obliged to work for 17 hours in excess of the basic 40 hour week. Held - 'The employce’s redundancy payment was to be calculated on the basis that his normal working hours were ‘the number of hours without overtime’ within 1 (1) of Sch 2 to the 1963 Act, ie 4o hours a week, since the hours of overtime whi 4 Paragraph 1, so fat as material, is set out at p 488 f co b, post.