Question: The Case

On 1 November, CFAO Plc sent a letter to Cannon Ltd, with which it had been

negotiating, offering it a contract to service all CFAO's birdseed processors each

month for the next five years at a cost of GHS20,000 per annum. The letter said

that Cannon should reply by return of post. Unfortunately, the letter contained an

error in the address and was not delivered to Cannon until 6 November. Cannon

replied at once, accepting. This letter was posted at 11am on 6 November. In the

meantime, on 4 November, CFAO had received an offer from Compu Ghana to

do the servicing work for GHS15,000 per annum. CFAO, having heard nothing

from Cannon, telephone Compu Ghana on 5 November and offered it the contract

at GHS10,000. Compu Ghana accepted. CFAO sent a fax to Cannon on 6

November telling it that the offer of 1 November was withdrawn. This fax was

received on Cannon's fax machine at 10.45am on 6 November, but not read by

anyone until 5pm on the same day.

Advice CFAO, Cannon and Compu Ghana.