3.2.23 Time of contract formation in the RSA ECT Act
The ECT Act invokes reception theory in section 22 (2) which reads that an agreement
is concluded at the time when and place where the acceptance of an offer was
received.381
Though unpopular in many jurisdictions, a time for contract formation is an apex
provision in the realm of electronic contracting. It has been shown that many
jurisdictions followed 1996 UNCITRAL Model Law by not inserting a provision for
contract formation. The Lesotho Bill has adopted the reception theory for contract
formation like the ECT Act.
Reception theory maintains that a valid contract is
concluded once the offeror receives acceptance regardless of whether the offeror is
aware of contents of the response therein.382 Reception theory is a default provision
both in the Lesotho Bill and the ECT Act, that is, it only applies when parties have not
agreed otherwise, and is said to be inherently neutral in terms of the applicable legal
system.383 In order to secure the parties’ compliance, the Lesotho Bill should place
reception theory under mandatory provisions as it is more appropriate for electronic
transactions because of their instantaneous nature.
3.3 TYPES OF ELECTRONIC CONTRACTS
3.3.1 Incorporation by reference in the Lesotho Bill and RSA ECT Act
Section 7(3) of the Lesotho Bill recognises incorporation by reference in contracts by
providing that information shall not be denied legal force and effect merely on the
ground that it is not contained in an electronic communication purporting to give rise
to such legal effect, validity or enforceability, but is merely referred to in such electronic
communication.384
Similarly, section 11(2) of the ECT Act provides that information is not without legal
force and effect merely on account that it is not contained in the data message
purporting to give rise to such legal force and effect, but is merely referred thereto.
381
S 22(2) ECT Act; Van der Merwe, S et al (2007) “Contract: general principles.” 3 rd ed. 72-75; Van der Merwe
2008: 151).
382 Van der Merwe et al (2008: 162).
383 Pistorius (2006: 178 at 207).
384 S7 (3) of the Bill.
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