Lalman Shukla v Gauri Dutt (1913)

Contract I · Offer & Acceptance

Facts.

A servant was sent to find his master’s missing nephew. While he was away, the master announced a reward for finding the boy. The servant, who did not know of the reward, found the boy and later claimed it.

Issue.

Can there be a valid acceptance of an offer by someone who did not know the offer existed?

Held.

There was no contract: acceptance requires knowledge of the offer, and the servant, ignorant of the reward when he acted, could not accept it. He was also merely doing his existing duty.

Why it matters.

It fixes the rule that an offer must be communicated and that acceptance presupposes knowledge of the offer — a favourite of examiners on reward problems.

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