When a contract has been concluded through the use of electronic communications, which theory is used to determine when and where this type of contract has been concluded?

Question: When a contract has been concluded through the use of electronic communications, which theory is used to determine when and where this type of contract has been concluded?

The theory used to determine when and where a contract has been concluded through the use of electronic communications is the receipt theory. Under the receipt theory, a contract is formed when the acceptance is received by the offeror. This is in contrast to the dispatch theory, which holds that a contract is formed when the acceptance is dispatched by the offeree.

The receipt theory is the preferred approach in most jurisdictions, including the United States and the European Union. This is because it is more consistent with the way that people use electronic communications to form contracts. When people communicate electronically, they expect the contract to be formed when the recipient receives the acceptance, not when the sender dispatches it.

The receipt theory is also more fair and efficient. Under the dispatch theory, the offeror could be bound by a contract even if they never received the acceptance. This would be unfair to the offeror, and it would also be inefficient because it would make it difficult for the parties to determine when and where the contract was formed.

Here is an example of how the receipt theory works:

• Offeror makes an offer to offeree by email.
• Offeree receives the offer email and decides to accept.
• Offeree clicks "send" to send their email acceptance.
• The contract is formed when the offeror receives the offeree's acceptance email.

Even if the offeree's acceptance email is delayed or lost, the contract is still formed under the receipt theory. This is because the offeree has done everything that is required of them to accept the offer.

The receipt theory is a fair and efficient way to form contracts through electronic communications. It is consistent with the way that people use electronic communications, and it protects the rights of both parties to the contract.