Consumer law : offer and acceptance on claim
Consumer law : offer and acceptance on claim To establish whether James has a case against 'Detox Ltd' we have to find evidence of a contract between himself and 'Detox Ltd'. Contracts are generally formed when two parties exchange promises and have reached agreement. This exchange has to have been formed on the basis of an 'offer' by one party and an 'acceptance' by another with the 'intent' to form a bilateral contract which is legally binding. The intent is generally regarded as being objective, with the court looking at what is said and done rather than trying to piece together what went on in the minds of the people involved. See Gibson v Manchester City Council [1979] 1 ALL ER 972. However, advertisements such as 'Detox's' do not require any communicated acceptance: A poster asking for the apprehension of a criminal and upon that apprehension a reward is given is referred to, as a unilateral contract. This is because no one actually has to look for the criminal, no promise is made to do so, no one is legally bound to do so, it is said 'to be an offer to the whole world'. One party with no need for any other negotiations makes the reward or offer. The 'acceptance' of this type of contract is in the actual performance, or specified conduct, which is required to receive the reward, looking for, finding, and then delivering to the offeror. See Errington v Errington [1952] 1 ALL ER 149 and Carlill v Carbolic Smokeball Co [1893] 1 QB 256. In Errington v Errington; A father who gave a house to his daughter and son in law, on the condition that they keep up the mortgage payments, was held to be a unilateral contract, and the mortgage payments were considered to be the performance, even though the father died, the offer of the house could not be revoked as the performance, the payments had already started. When this 'acceptance' takes place is some what unclear, but in Daulia v Four Millbank Nominees Ltd [1978] 2 ALL ER 557; Goff LJ stated; ' There must be an implied obligation on the part of the offeror not to
prevent the condition becoming satisfied, which obligation it seems to me must arise as soon as the offeree starts to perform'. This statement suggests that it would be unjust for the offeror to withdraw the offer once the offeree has started the performance. This point is strengthened in the decision of Errington v Errington, explained above. James did not make an offer or make a promise to 'Detox', so we have to establish if the advertisement which he saw, was in fact an 'offer'. Advertisements such as those found in magazines, newspapers and shop displays are generally considered to be ...
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prevent the condition becoming satisfied, which obligation it seems to me must arise as soon as the offeree starts to perform'. This statement suggests that it would be unjust for the offeror to withdraw the offer once the offeree has started the performance. This point is strengthened in the decision of Errington v Errington, explained above. James did not make an offer or make a promise to 'Detox', so we have to establish if the advertisement which he saw, was in fact an 'offer'. Advertisements such as those found in magazines, newspapers and shop displays are generally considered to be 'invitations to treat', i.e., an invitation to make an offer to the advertisers or seller. See Fisher v Bell [1961] 1 QB 394 and Partrtridge v Crittenden [1968] 1 WLR 1204. In Partrtridge v Crittenden, the defendant was arrested and charged with offering for sale live wild birds contrary to the Protection of Birds Act 1954, via an advertisement in a monthly periodical. It was held that this was not an offer but an invitation to treat, an offer to enter into negotiations. Lord Parker CJ, stated: 'There was a business sense in treating such advertisements as' invitations to treat' because if they were treated as 'offers' the advertiser might find himself contractually obliged to sell more goods than he in fact owned'. Also see: Pharmaceutical Society v Boots Chemists [1953] 1 ALL ER 482. This does not seem to be the case with the 'sure quit' advertisement as they are actually manufacturing the products and have a large supply, selling the product via retailers. Offers are verbal or written statements with certain conditions laid down by the offeror with a willingness to enter into a contract, if and when these conditions are met. In Carlill v Carbolic Smokeball Co, The claimant purchased one of the defendants products after seeing an advertisement saying they would pay ú100 to anybody who caught flu after using one of their smoke balls in the specified manner, the defendants also stated, that to show good faith they would deposit ú1,000 in a bank account. The claimant used the product as directed but caught flu, and she sued the company for the ú100. It was held that this was an offer to the whole world, rather than an invitation to treat, anyone who complied with the instructions in the advertisement was entitled to the reward. Lindley LJ commented on the words in the defendant's advertisement: ÆA distinct promise expressed in language which is perfectly unmistakable'. Lindley LJ, recognised within the words of the advertisement that a promise was made by the offeror and the acceptance was made, via the performance, by the offeree therefore establishing the basic requirements for a contract. The wording of the 'detox's' advertisement; 'To pay ú500 to anyone who used it (according to the instructions) for a period of three months, and failed to stop smoking or suffered any ill effects'; Is laid out to suggest that there is a task to perform, similar to the case in Carlill v Carbolic Smokeball Co, and on completion of the task results in any of the conditions outlined in the advertisement, (still smoking or any ill effects) then they will pay ú500 to the user. It is clear, in the question, that James has a fulfilled the criteria in the advertisement, by performing the task he has entered into contract (unilateral) with 'Detox Ltd' in answer to their offer, and is entitled to the ú500 reward. He also has some medical evidence from his Doctor that the use of 'sure quit' had caused his dizzy spells, which would back up his argument if the case went to court. The defendants could argue that the offer had been withdrawn; they had revoked the offer and made notice of that, in the August edition of the periodical. A withdrawal of an offer has to be communicated to the offeree and this has to be done before acceptance. In Byrne v Van Tienhoven (1880) 5 CPD 344 The defendants sent an offer on the 1st of October, which was received on the 11th October, an acceptance was sent by telegram, but the defendants had sent a letter of revocation on the 8th of October, which arrived on the 20th of October. It was held that there had been an acceptance of the offer before the revocation so the contract was still valid. With unilateral contracts, i.e. 'offers to the whole world', the revocation has to be made available to all those who had seen the original offer by displaying the revocation in the same manor. See Shuey v US (1875) 92 US 73. 'Detox Ltd' had complied with this, but James had already started the performance, which constitutes acceptance, as he had acted upon the advertisement in June. I would advise James, to sue 'Detox Ltd' for the ú500 as he had complied with the conditions outlined in the advertisement, he has strong evidence for his medical condition provided by his doctor, which proves that the use of æsure quitÆ has caused his dizzy spells. He has answered their promise (offer) with a promise of his own by his conduct, performance and his acceptance. If the revocation had been published in the May edition of the periodical, my advice to James would be the reverse, the withdrawal of the offer would have been advertised before James had started the performance, even though he may not have seen the revocation in the May edition, 'Detox Ltd' took the necessary steps to notify the readers of the fact in the magazine. See Shuey v US (1875) 92 US 73. Kate's claim for the ú500 reward does not seem as solid as James's case. Kate had used the product as instructed but she did not purchase a bottle of æsure quitÆ. The defendants could argue that to enter into performance and accept the offer you would first have to purchase the product, Kate could argue, that the requirement laid down in the advertisement was just to 'use' the product. We have already established that the 'acceptance' starts once performance begins, See Daulia v Four Millbank Nominees Ltd; but pin pointing the actual start of the performance is difficult to establish, i.e. Is putting on your walking boots the start of the walk, or is it moving one foot and then the next when you get outside? This point I find unclear, even though the words of the 'sure quit' advertisement only mentioned the 'use' of the product. Was it a condition of the contract, that to be accepted, she would have to purchase a bottle of 'sure quit' to enter into the performance? In the case of Carlill v Carbolic Smoke ball Co; Bowen LJ stated, obiter, 'It did not follow that the smoke ball was to be purchased from the defendants directly' In the above statement, it would seem that the purchase of a bottle of æsure quitÆ was not a necessary part of the acceptance but just the use of it as the advertisement stated. But is it enough to be aware of the offer even though she did not buy the product? It could be argued that because Kate had not seen the advertisement, she was not aware of the offer and therefore could not have accepted, see Gibbons v Proctor (1891) 64 L.T. 594; Her only motive for using the product was just to give up smoking and not claim the reward. In Williams v Carwardine (1833) 4 B & Ad 621; It was held that as long as the offeree was aware of the reward any other motive would be irrelevant and the plaintiff would be entitled to the reward. In this case KateÆs husband, James would have told her of the reward, so she would have been aware. So the main problem with KateÆs situation is the start of the performance. Would it be obvious to the reasonable person that the purpose of æDetoxÆsÆ offer was to sell the product? Using Lord Dennings 'Gleaning ' approach, (looking at the purpose of the whole contract) See Gibson v Manchester City Council; you could presume that the last question is the case, and the start of the requested performance would be the purchase of the product, if that is so then Kate would not be entitled to the reward, as she did not accept the offer by conduct. While deciphering the content of the advertisement, in Carlill v Carbolic Smoke ball Co, AL Smith LJ, stated, obiter; 'In consideration of your using my smoke balls at my request, and paying for them, which is a necessary part of the use' This statement and the statement made by Bowen LJ (see above) contradict each other and leave Kate's position unclear. I would advise Kate to be cautious, as it seems to me that her claim for the ú500 would be decided on whether could be shown that she entered into performance without purchasing the bottle of 'Sure Quit'.