Difference Between Widget And Postal Rule

The two issues of this case was whether there is a contract between Widget and Cobbler, after the email had gone astray, and whether Widget could use their terms and conditions after Cobbler sent an counter-off.

As there is no test case on whether an email comes under the instantaneous principle, or the postal rule in New Zealand, it is important to discuss email coming under both rules.

The instantaneous principle came from Entores Ltd v Miles Far East Corp. stating that a contract is formed only, when the offeree receives communication of the offerors acceptance. An example of the instantaneous principle is when a person receives communication through the phone of the acceptance, and now has the knowledge of having the acceptance and thus a contract. If for some reason the phone call drops, in the middle of the person confirming their acceptance, it is their responsibility to ring back to confirm the acceptance. Without confirming, there is no contract. If the current case comes under the instantaneous principle, the email Widget sent to Cobbler on the confirmation of the order standard form would not be an acceptance of offer until Cobblers had received it. Widget should have then later confirmed that Cobbler got their email and accepted it. But as Cobbler never received the email,
The postal office would then be a third party between the two other parties who are in negotiation. Using that analogy, email could be a part of the postal rule, as the Internet provider is also a third party between Widget and Cobbler. Using this rule with the current case, a contract was formed between Widget and Cobblers, as soon as Widget sent the email, despite the email going astray and never reaching Cobblers email