Hobbs v. Massasoit Whip Co.
158 Mass. 194 (1893)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
Silence and retention of goods can operate as an acceptance of an offer when the prior course of dealing between the parties creates a duty on the offeree to speak if it intends to reject the offer.
Facts:
- Hobbs sent a shipment of eelskins to Massasoit Whip Co.
- On four or five previous occasions, Hobbs had sent eelskins to Massasoit Whip Co. in the same manner.
- In each of the prior transactions, Massasoit Whip Co. had accepted and paid for the eelskins.
- Massasoit Whip Co. retained the eelskins in question for several months.
- Massasoit Whip Co. never notified Hobbs that it had declined to accept the skins.
- The eelskins were eventually destroyed while in Massasoit Whip Co.'s possession.
- The parties had a standing understanding that Massasoit Whip Co. would accept skins that met certain specifications for its business.
Procedural Posture:
- Hobbs (plaintiff) initiated an action in a Massachusetts trial court against Massasoit Whip Co. (defendant) for the price of the eelskins.
- The case was tried before a jury.
- The trial judge instructed the jury that if Massasoit Whip Co., knowing the plaintiff believed it was accepting the skins, failed to notify him of its rejection, the jury could find for the plaintiff.
- Massasoit Whip Co. (defendant) took exception to the judge's jury instruction and appealed to the Supreme Judicial Court of Massachusetts, the state's highest court.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Does an offeree's silence and retention of goods for an unreasonable amount of time constitute acceptance of an offer when prior dealings between the parties have established a reasonable expectation that such goods would be accepted?
Opinions:
Majority - Holmes, J.
Yes. When a pre-existing relationship and course of dealing exist between parties, an offeree has a duty to reject an offer if it does not wish to accept, and silence coupled with retention of goods for an unreasonable time can be found by a jury to constitute acceptance. The plaintiff, Hobbs, was not a stranger to the defendant; he had sent skins four or five times before, which were accepted and paid for. This history of prior dealings established a reasonable basis for Hobbs to assume that Massasoit Whip Co. would accept the skins unless notified otherwise. This context imposed a duty on the defendant to act. The defendant's silence and retention of the skins for an unreasonable time warranted the plaintiff in assuming they were accepted. The law assesses acceptance based on objective conduct that imports assent, regardless of the party's actual, subjective state of mind.
Analysis:
This case establishes a significant exception to the general common law principle that silence does not constitute acceptance of an offer. It demonstrates that a prior course of dealing can impose an affirmative duty on the offeree to notify the offeror of a rejection. This decision reinforces the objective theory of contract formation, where the external manifestations of a party's intent (their conduct) are more important than their unexpressed, subjective intent. The precedent is critical in commercial law, especially for parties with ongoing business relationships, as it provides that inaction can legally bind a party to a contract under specific circumstances.
