Old Wine in a New Bottle? The Application of the Postal Acceptance Rule In Sri Lanka

The postal acceptance rule or postal rule represents the wisdom of common law judges in the 19th century when the postal system was considered to be the main mode of business communication in distance transactions. It sets an exception to the receipt rule that the acceptance must be communicated to the offeror. It upholds the notion that “the acceptance is complete as soon as it is posted”. However, with the development of information and communication technology at the end of the 20th century and 21st century with the near absolutism of postal communication among people, a controversy has arisen as to what extent the postal rule should be applied.
The application of the postal rule depends on one central question: whether the form of communication is instantaneous or not. Generally speaking, in an instantaneous method of communication, negotiation takes place between the offeror and the offeree in each other’s presence. In such a situation, the general rule is that the acceptance must be communicated to the offeror for agreement to occur. Conversely, in the case of non-instantaneous communications such as post, a contract is concluded once the acceptance has been sent by the offeree to the offeror. The question that arises here is what modes of communication are instantaneous? It is noted that some modes of communication that are equivalent to face-to-face communication such as telephone and video conferencing fall within the instantaneous category. However, a controversy arises in a context where the courts interpreted some distance modes such as telegram, telex and facsimile as instantaneous. With the invention of email in 1971 by Raymond Tomlinson, another question had arisen as to whether emails are a digital equivalent to post so that the postal rule should be applicable.
Some claim that the postal rule applies to email communications while the same view is met with opposition. Divergence among these views showcases the ambiguity of the law and stands as a grey area worthy of further discourse. This paper examines to what extent the postal rule is applicable to email communications in Sri Lanka. In so doing, this paper explores the rationale behind the rule and the state of ambiguity pertaining to the rule being applied to emails. It further analyses whether and to what extent the Sri Lankan Electronic Transactions Act, No. 19 of 2006 (as amended) embraces the application of postal rule into email communications.