Cole-McIntyre-Norfleet Co. v. Holloway

Supreme Court of Tennessee · 1919 · Contracts

141 Tenn. 679 (1919)

Updated July 19, 2026

Contractsacceptancesilence as acceptancereasonable timedelaytraveling salesmanorders subject to home-office approvalduty to notify

Facts

On March 26, 1917, the seller's traveling salesman, acting within his authority to solicit orders, received from the buyer an order at the buyer's country store for various goods, including fifty barrels of meal. The written order stated that it would not be binding until accepted by the seller at its Memphis office, that the salesman had no authority to sign for either party, and that the order was not subject to countermand. The seller gave no notice of acceptance or rejection for about sixty days, although its salesman saw the buyer weekly and the seller could have communicated by mail or wire. On May 26, after prices had greatly advanced, the buyer asked the seller to begin shipment of the meal, and the seller then said it had not accepted the order.

Issue

When a buyer submits an order that is subject to the seller's home-office acceptance, does the seller's silence and unreasonable delay in notifying the buyer of rejection constitute acceptance of the order under the circumstances of this case?

Rule

Although an offer ordinarily is not binding until acceptance is communicated, acceptance may be shown by formal notice or by acts and circumstances amounting to acceptance. Where a wholesale merchant sends agents to solicit orders for perishable or consumable goods and has ample opportunity to notify the customer, silence for an unreasonable time in accepting or rejecting the order will amount to acceptance if the customer is relying on the merchant for the goods.

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River Bend Grocers, a wholesale food distributor based in Nashville, sent its sales representative to solicit orders from Lena Ortiz, who runs a market in Jackson, Tennessee. Lena signed a written order for canned beans and flour stating that it was subject to approval at River Bend's office and could not be canceled; River Bend said nothing for seven weeks, even though its representative stopped by the store every few days and prices rose sharply while Lena waited for the goods.

If Lena sues claiming a contract was formed, which is the strongest argument for her?

Explanation. The majority held that silence does not ordinarily equal acceptance, but under special circumstances it can. When a wholesale merchant solicits orders for consumable or perishable goods, has ample opportunity to notify the customer of rejection, and the customer is relying on the order, an unreasonable delay in rejecting can amount to acceptance even if the writing says it is subject to home-office approval.