Case Facts
The dispute concerned a proposed lease transaction between two parties. On 18 March 1825, Grant sent Routledge a written proposal offering to pay a premium of £2,750 for a 21-year lease of certain premises, with an option to extend to 31 years on six months' notice, at a rent of £250 per annum. The offer required possession to be given on or before 25 July 1825, and stipulated that Routledge must provide a definitive answer within six weeks of 18 March 1825 — meaning the offer would expire on 1 May 1825.
A complication arose from Routledge's position at the time the offer was made. On 18 March 1825, Routledge held only a 12-year term in the premises. He therefore needed to apply to his own landlord for a new lease before he could properly accept Grant's proposal. He subsequently surrendered his existing lease and obtained a new 32-year lease dated 21 April 1825.
On 6 April 1825, Routledge wrote to Grant purporting to accept the offer. However, rather than confirming possession on or before 25 July 1825 as Grant's offer required, Routledge stated he would give possession on 1 August next. That same evening — before his written note had been sent — Routledge apparently indicated in conversation with Grant that he was "off" the deal.
On 7 April 1825, Grant wrote withdrawing his proposal entirely, and on 9 April 1825 confirmed this withdrawal in writing, noting the conversation of the previous evening. Routledge then sent a further letter on 29 April 1825, seeking to correct his earlier purported acceptance and confirming he was ready to give possession in accordance with the original terms — that is, on or before 25 July 1825. The six-week period did not expire until 1 May 1825, so this second letter arrived while the offer period was technically still running.
Routledge brought an action against Grant, alleging breach of contract. At trial before Best CJ at the London sittings, Routledge was nonsuited. The matter came before the full Court of Common Pleas on a rule nisi to set aside that nonsuit. The declaration alleged that Routledge had been entitled to a 31 or 32-year term at the relevant time, a contention that Grant disputed.
Held
The Court of Common Pleas declined to set aside the nonsuit and upheld three distinct grounds for the decision against Routledge.
First, the court held that where an offeror grants an offeree a fixed period within which to give a definitive answer, the offeror is equally at liberty to retract the offer at any point during that period before it has been accepted. Grant's withdrawal of 7–9 April 1825 was therefore effective. The court reasoned that the parties must stand on an equal footing: it would be unjust to hold one party bound whilst leaving the other entirely free.
Second, there was a material variance between the declaration and the evidence. The declaration alleged that Routledge had been entitled to a 31 or 32-year term at the time the offer was made, but the evidence showed that on 18 March 1825 he held only a 12-year term and had produced no written contract demonstrating an entitlement to a longer term. This discrepancy between the pleadings and the proof was itself sufficient to support the nonsuit.
Third, even setting aside the revocation point, Routledge's letter of 6 April 1825 did not constitute a valid acceptance of Grant's offer. The offer required possession to be given on or before 25 July 1825; Routledge's purported acceptance stipulated possession on 1 August. An acceptance that departs in any respect from the terms of the offer is no acceptance at all. Routledge's subsequent letter of 29 April 1825, whilst conforming to the original terms, came too late: by that date Grant had already validly withdrawn his offer.
Ratio Decidendi
Three propositions of law emerge from the judgement.
First, an offeror who has given the offeree a specified period within which to accept remains free to revoke the offer at any time before acceptance occurs within that period. The mere granting of time does not bind the offeror to keep the offer open. This principle rests on the requirement of mutuality: where no consideration has been provided to keep the offer open — that is, where there is no binding option contract — one party cannot be held bound whilst the other retains complete freedom. This principle was subsequently applied in Dickinson v Dodds (1876) and affirmed in Byrne v Van Tienhoven (1880) and Stevenson v McLean (1880).
Second, there must be no material variance between the facts alleged in the pleadings and the facts proved at trial. Where a claimant's declaration asserts an entitlement that the evidence does not support — here, a 31 or 32-year term when only a 12-year term existed at the material time — the action will fail on that ground independently of any other consideration.
Third, acceptance must correspond precisely and unconditionally with the terms of the offer. Where a purported acceptance varies from the offer in any degree — even a relatively minor one, such as a date of possession differing by a matter of weeks — it does not constitute a valid acceptance and no contract is formed. This principle is now commonly known as the mirror image rule and was confirmed in the context of offer and acceptance analysis in Adams v Lindsell (1818).
Obiter Dicta
The court observed, that the position might differ where consideration had been given to keep an offer open — that is, where the parties had entered into a binding option contract. In such a case, the offeror's freedom to revoke before the expiry of the agreed period might be constrained by the terms of that separate agreement. This observation did not bear directly on the outcome, since no such consideration had been provided in the present case. It nonetheless points towards what is now understood as the distinction between a bare offer made with a time limit and a formal option supported by consideration.