Every day, we come across luring advertisements. These statements and proposals target to invite us into buying the advertised goods and services.
A contractual issue arises about when advertisements amount to offers. The discussion below illuminates the concept of offer thereby establishing whether advertisements amount to consideration offers.
It is trite in principle that a contract exists once another party unequivocally accepts the offer at a value known as consideration. However, not all statements made by a party seeking to initiate a contract amount to an offer.
At the heart of this argumentative blog is a primary objective of deconstructing the elements of both offer and acceptance, with an objective of establishing whether an advertisement is an offer. On balance, an advertisement is not a consideration offer since it is a mere invitation to initiate negotiations.
Unilateral and Bilateral Advertisements
In common application, an advertisement can be broken down into two phases, namely unilateral and bilateral. A bilateral advertisement is a mere invitation to treat. Put differently, it is a proposal to make an offer.
The rationale behind this argument is that an advertisement may lead to further bargaining. Additionally, the seller may use it to ascertain that the buyer has the requisite fiduciary capacity before creating the contract.
Courts have applied the same reasoning in cases such as Partridge v Crittenden (1968) whereby Partridge had advertised in the newspaper stating his intention to sell his wild birds. The Court of Appeal then faced the issue of ruling whether the advertisement amounted to an offer. It held that this was a bilateral advertisement, not an offer.
On the other hand, an advertisement of unilateral nature entails an expression that clearly stipulates a reward or price. Halsbury’s laws provide that a contract comes into being once an offer is proposed on ascertainable terms that cause reception of unqualified acceptance from the individual to whom it is made (Halsbury Laws of England, 1998).
Further, the Court in the case of Carlill v Carbolic Smoke Ball Co. (1893) adopted the argument that an advertisement attempts to induce an offer and is not an offer in its face. In this case, the defendant placed an advertisement in a newspaper, making a promise for a reward of money for anyone who could fail to recover from influenza after taking the defendant’s medicine. The court reasoned that this advertisement amounted to an offer since the advertisement constituted a clear expression of the defendant’s intention.
Are “Adverts invitation to Treat” or “Offers”?
From the above analysis, the question about whether an advertisement is an invitation to treat or an offer depends on the intention of the individual making such expression. Further, the qualification of an advertisement as an offer relies on what interpretation the target audience develops. Primarily, an advertisement invites customers to initiate an offer. Therefore, the seller accepts the offer when he or she makes acceptance of the money from the customer.
Apparently, courts do not consider advertisements as offers because it is not possible to make an offer to the whole world. Unless a statement expresses the author’s intention to contract, as was the case in Carlill v Carbolic, an advertisement is an invitation to initiate negotiations.
Moreover, there is a need for more literature on these basics of contracts, that is, offer and acceptance. Scholars need to emphasize develop a concrete jurisprudence that ensures consumer protection given the fact that some advertisements hide under the veil of invitation to treat while furthering deception. In as much as advertisements are sales puffs, they must be statements of facts and operate on a reasonable basis of truth.