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Hedge pic accidentally advertised a car tyre for £10 per tyre instead of £100 per tyre. Before Hedge pic could change the advert it received two email orders from Arthur and Binta accepting four tyres for £40
Arthur also transferred £40 fo Hedge pic’s bank account
Which of the following statements correctly explains whether or not Hedge pic must sell the tyres for £40?
0/2
Hedge pic does nof have to sell to Arthur or Binta because the e-mails constiuted invitations to treatHedge pic must sell to Arthur because the transfer of £40 confirmed acceptance
Hedge pic does not have to sell to Arthur or Binta because the e-mails constituted offers
Hedge pic must sell to Arthur and Binta as the acceptance e-mails were received before the advert was changedWhat would be the correct answers.?
I think option A is correct.Unless it’s a ‘reward’ situation (Carlill v Carbolic Smoke Ball Company) English Law takes an advert to be an invitation to treat rather than an offer capable of being accepted.
This being so, and in the absence of any information of any kind of ‘reward’, I would suggest that Hedge’s advert would be seen by the Court to be an invitation to treat and therefore option (a) would seem to me to be the correct answer.
HOWEVER!!!!! I believe that you would not have posted this question if the printed solution had also given option (a) as being correct. So, What does the printed solution offer as the answer?
I await with baited breath!
I thought option C should be correct as emails from Arthur and Binta are only offers. Option A mentions the emails as invitation to treat rather than the advertisement by Hedge
Oh! Mike, Mike, Mike! Self-berating – RTFQ
You’re correct of course – option A mentions the emails as being invitations whereas I’m working on the basis that the original advert was the invitation.
Let’s have another (more careful) look!
Option A is clearly incorrect – the emails are offers following the advert invitation to treat
Option B If the advert is an invitation, that’s not available to be ‘accepted’ so Option B is incorrect
Option D also incorrect because the advert (as above) is an invitation and not available to be ‘accepted’
And that leaves us with Option C – the emails ARE offers following the advert invitations. And Hedge presumably does not want to accept these offers so does not need to sell the tyres for £40
Makes sense now? I hope so – and there’s a lesson for you (and it’s one that I emphasised over and over again to students) RTFQ
Humble apologies for my breach of my own exhortations!
I agree with the above answer. The only thing that muddies the waters, however, is the reference of Arthur transferring money into the bank account. If the bank account details were included in the advert this would strengthen the argument that the advert constituted an offer. The inclusion of bank account details in an advertisement could potentially strengthen the argument that it constitutes an offer, as it might be seen as providing a means for immediate acceptance. However, this alone is not sufficient to transform an advertisement into an offer.
In any event it is not wise to include bank details in an advert. However, it’s not clear this happened in the above scenario. Arthur may have previously conducted business with Hedge pic and have existing knowledge of the bank details of Hedge Pic.
Whoa Jon! You’re reading a lot into the question that isn’t even hinted at! I agree that the payment into the bank was a worry that I pondered over but, eventually dismissed as a red-herring.
There was a past exam question where a car (?) was advertised for a cash sale and someone accepted but stated that they needed to go to their bank to arrange for the funds to be available. Was that acceptance valid? The advert had included words such as ‘this is a serious offer’, ‘cash only’, ‘first come first served’
The provided solution (I don’t remember the quoted case that set the precedent) was that the ‘acceptance’ was good because the acceptor had undertaken to carry out the necessary actions to obtain the cash and had started on those actions. ‘Once the actions necessary to formalise the acceptance have started, the offeror cannot go back on the offer’
I don’t remember the precise wording of the question but I do remember that invitation, offer and acceptance were crucial to ‘the story’ and that the ‘going to the bank to arrange the necessary finance’ was also crucial.
OK?
Just floating an interesting hypothetical. I think you are right that more precise language would be needed other than just presentation of bank details for it to be considered an offer. Here’s another example of an advert being held to be an offer-
https://opentuition.com/topic/bowerman-and-another-v-abta-1996/
Jon, I’m sure there must be loads of cases to illustrate the ‘reward’ exception to adverts / offers. However, given that this is a law exam for accountants and not a law exam for lawyers, the number of illustrative cases necessary to establish the principle does not need, I believe, to be any more extensive than is covered by the notes and lectures.
But thanks as always for your input
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