P, a car salesman, is advertising one of his cars, made by Ferrari for sale at the price of € 50000 in the newspaper. N see the advertisement and calls to P. offering him €40000. P rejects N's offer and tell N. that he would be willing to discuss an offer for 45000. N agrees on the price but under the condition that P. proves to her that the car is indeed a genuine Ferrari. P promises to disclose all necessary documents in the next 3 weeks. N agrees and waits. Two weeks later N. discovers that P. has sold the car to C. For 50000. Advise N. In order to advise N, it is critical to analyze the terms of the case.The case is clearly a case of an offer and verbal acceptance.This is a practical case of a unilateral offer. Before proceeding, we can discuss the concepts of a unilateral and bilateral offer. Richards (2010) noted that a bilateral offer is the kind of an offer that arises when one party promises to fulfill or do something in return for another promise that is made by the offeree. In this case, both parties are essentially agreeing to accomplish something in return for a given promise made by the offeree. In other words, both parties are agreeing to accomplish something in return for some other reciprocal promise from the other party. For instance, if N. promises to sell their house in return for B. promising to pay £6,000. A large number of offers are of this particular type. A unilateral offer on the other hand occurs whenever a given party, hereby referred to as the offeror, expressly promises to pay for the act of the other party, in this case we mean a conditional promise. In this case, we see that N. agrees on the price but under the condition that P. proves to her that the car is indeed a genuine Ferrari.This makes this a unilateral offer since it is only one side that promises to buy after her conditions are fulfilled.As Koerner (1958,p.1016) noted, newspaper advertisements can be considered as an offer to sell a product.As was the case in the Carlill v Carbolic Smoke Ball Co (1893) case, advertisements can indeed mount into an offer.

It is worth noting that most advertisements never qualify to be offers.Instead, they qualify to be statements inviting other for further negotiations. This is called invitation to treat. A perfect example is the Partridge v Crittenden [1968]

case. In this particular case, the appellants put up an advertisement in a bird fanciers' periodicall and stated that 'Bramblefinch cocks and hens 25s'.They were however charged under the nations' Protection of Birds Act 1954, section 6 (1).Initially, the appellants were convicted but after appealing, their conviction was squashed by the state's Division Court. This particular decision is inline with an earlier decision in the case of Harris v Nickerson in which an auctioneer duly advertised that some specific goods would be on sale in a certain location on a given date. However, the plaintiff went to the much advertised sale only to find that all of the lots that he was interested in were all withdrawn. He then proceeded to sue the auctioneer for his loss of expenses and time. It was held by the courts that the claim failed since the auctioneer's advertisement was merely an clear case of declaration of intent to hold a sale and therefore never amounted to an offer that is capable of being accepted and could never form a basis of a binding agreement/contract. This advertisement therefore amounted to a mere invitation to treat.N must therefore know that the advertisement by P. could indeed be treated as an invitation to treat since it never amounted to an offer. What could have made it to amount to an offer is his verbal confirmation that he would accept to discuss the €45000 that N. proposed. The offer to discuss the situation therefore is a further fact to indicate that indeed this case was an invitation to treat...

On the claims that he never honored his part of the bargain since what P. suggested was a chance for further negotiations. This chance for further negotiations is what is referred to as an invitation to treat.
Whenever a product in very large quantities is duly advertised in a poster or newspaper then generally, it is not considered an offer. It is however treated as an invitation to treat because there is no guarantee that the offerer might provide the given item to any individual that might need one. This argument was the basis of the decision in the case, Partridge v. Crittenden.

References

Harris v Nickerson (1873) LR 8 QB 286,

Koerner, TG (1958). Contracts: Offer and Acceptance: Newspaper Advertisement as Offer to Sell. Michigan Law Review Vol. 56, No. 6 (Apr., 1958), pp. 1016-1019

Partridge v Crittenden [1968] 2 All ER 421

Richards, P (2010). Law of Contract,9th edition.Pearsons

The importance of the Carlill v Carbolic Smoke Ball Co (1893) case ?

The Carlill v Carbolic Smoke Ball Co (1893) case is of great importance in contract law since it specifically highlights the meaning of an offer as part of a contract. Before delving deeper into the basics and implication of the case (case analysis), it is important for the facts of the case to be presented.

Facts of the Case

In this particular case, the plaintiff (Mrs. Carlil) bought a certain product called 'The Carbolic Smoke Ball' ( a supposed cure for influenza cold and such like ailments) from the defendant (Carbolic Smoke Ball Co) on the basis of the promise by the defendant's advertisement that they would promptly pay £100 ( a large sum of money at that time) to any customer who contracted influenza after using the product as prescribed and for a certain period of time. As a 'show of their sincerity', the defendant indicated that they had in turn deposited a total of £1,000 with the Alliance Bank, located at Regent Street.

The plaintiff bought the smoke balls and then used it according to the prescription but in an unfortunate twist of events, caught influenza. She then sued the Carbolic Smoke Ball Co for the originally advertised amount -£100. However, the defendant argued that the advertisement was not to be taken as a serious and legally binding offer.The defendant therefore maintained that there was no form of agreement between them and the plaintiff and then used a considerable level of ingenuity in trying to promote this argument and contention.

One of the defenses employed was that it was ever possible to make an offer to the 'whole world' since that would in essence enable the whole world to effectively accept the offer; a scenario which was beyond the limits of commercial reality. This defense was easily rejected by the Court of Appeal when Bowen LJ indicated that position very clearly by saying that;

"It was also said that the contract is made with the whole world -- that is, with everybody and that you cannot contract with everybody. It is not a contract made with all the world. There is the fallacy of the argument. It is an offer made to all the world; and why should not an offer be made to all the world which is to ripen into a contract with anybody who comes forward and performs the condition? . . . Although the offer is made to the world, the contract is made with that limited portion of the public who come forward and perform the condition on the faith of the advertisement." (Richards,2010,p.16)

The defendants also argued that the plaintiff never accepted their offer and therefore no consensus ad idem existed and therefore no contract. This specific defense too was rejected but not before exposing…