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Can silence ever equal agreement to a contract?

| Jun 29, 2021 | Business Litigation

Working out deals in the business world is sometimes a complex undertaking, and every contract relies on the idea that there has to be both an offer and acceptance of that offer before a deal is made.

Can silence ever equal acceptance in a deal? Normally, no, it cannot — but there are a few exceptions.

When can silence replace an affirmative agreement in a deal?

It isn’t very common for silence to signal acceptance, and it usually only occurs when you have a prior working relationship with the other party. In those situations, silence can equal agreement to a deal when:

  • The offeree gives a clear impression to the offeror that their silence equals acceptance.
  • The offeror communicates to the offeree that silence will be taken as acceptance and the offeree assents.
  • Goods are exchanged and the offeree acts as if they have accepted the contract from the offeror.
  • There’s an existing business relationship between two merchants and acceptance is implied to changes in agreements.

For example, imagine that you’re a contractor who normally uses the same plumbing company as a subcontractor on all your jobs. You routinely ask the plumber to send you an estimate on a job and it’s been customary for the plumber to start work after 10 days unless they hear back from you regarding the price or any other concerns. In that case, your silence would be taken as agreement to the deal.

Similarly, maybe you supply all the widgets for a local company to sell. The prices on widgets went up before the last shipment, so you increased the bill accordingly and sent the shipment anyhow. The local merchant puts the widgets on the shelf to sell — thereby behaving as if the contract (at the new price) for the widgets is accepted even without their verbal or written agreement. 

Understanding the complexities of your business contracts can be rough. Working with an experienced advocate can help you avoid critical mistakes and respond to disputes over your agreements.