The traditional offer-acceptance model, while a cornerstone of contract law, faces challenges in modern commercial contracts. While it remains relevant for basic transactions, its rigidity can struggle to encompass the complexities of contemporary business dealings. Modern contracts often involve extended negotiations, standard form agreements, and electronic communications, which can make the simple offer-acceptance framework inadequate.

Critical Evaluation: Is the Traditional Offer-Acceptance Model Still Relevant in Modern Commercial Contracts?
The classical contract law model, rooted in the offer-acceptance framework (derived from English common law and codified in Section 2 of the Indian Contract Act, 1872), has long been the foundation of contract formation. However, modern commercial practices—such as clickwrap agreements, dynamic pricing, and AI-driven negotiations—challenge its rigidity. Below is a critical assessment of its continued relevance.

1. The Traditional Offer-Acceptance Model
Core Principles
Offer (Section 2(a), ICA): A definite promise to be bound on specific terms.

Acceptance (Section 2(b), ICA): Unconditional assent to the offer, communicated properly.

Consideration (Section 25, ICA): Mutuality of obligation.

Strengths
✅ Legal Certainty: Provides a clear framework for determining when a contract is formed.
✅ Predictability: Courts rely on it to resolve disputes (e.g., Carlill v Carbolic Smoke Ball Co., 1893).
✅ Flexibility in Adaptation: Indian courts have applied it to digital contracts (Trimex v Vedanta, 2010).

2. Challenges in Modern Commerce
(A) Complex, Multi-Stage Negotiations
Modern deals (e.g., M&A, joint ventures) involve iterative drafts, term sheets, and LOIs, blurring the line between offer and acceptance.

Example: A party may act in reliance on an incomplete term sheet, raising estoppel claims rather than strict contract formation.

(B) Standard Form & Digital Contracts
Clickwrap/Browsewrap agreements (e.g., Amazon’s T&Cs) operate on "take-it-or-leave-it" terms, making traditional acceptance formalities obsolete.

Indian Position: Courts enforce digital contracts (Shreya Singhal v Union of India, 2015 indirectly supports digital consent), but mass-market agreements lack true negotiation.

(C) AI & Automated Contracting
Algorithmic pricing (e.g., Uber’s surge pricing) and smart contracts (blockchain-based self-executing agreements) function without human offer-acceptance exchanges.

Legal Gap: Indian law does not yet address AI as an agent of offer/acceptance.

(D) Global & Relational Contracts
Long-term supply chain agreements rely on ongoing performance rather than a single offer-acceptance moment.

Example: Courts imply good faith obligations (Central Inland Water Transport v Brojo Nath, 1986), going beyond classical theory.

3. Judicial Adaptation in India
(A) Relaxing Strict Formalities
Emails & Conduct as Acceptance: Courts recognize electronic communications as valid acceptance (Bhagwandas Goverdhandas Kedia v Girdharilal, 1966).

Performance as Acceptance: Acts in reliance (e.g., delivering goods) can constitute acceptance (Lalman Shukla v Gauri Dutt, 1913).

(B) Implied Terms & Good Faith
Courts supplement rigid offer-acceptance rules with equitable doctrines (e.g., promissory estoppel, unjust enrichment).

(C) Limitations
No Clear Rules for Dynamic Contracts: Indian law struggles with self-adjusting contracts (e.g., algorithmic supply agreements).

Consumer Contracts: Standard forms often exploit unequal bargaining power, making traditional analysis inadequate.