Carlill v Carbolic Smoke Ball
Co [1893] 1 QB 256 Court of Appeal
The Law of Contract . Advertisement
A Newspaper advert placed by the defendant
stated:-
100 reward will be paid by the Carbolic Smoke
Ball Company to any person who contracts the
influenza after having used the ball three times
daily for two weeks according to the printed
directions supplied with each ball...
1000 is deposited with the Alliance Bank,
showing our sincerity in the matter."
Mrs Carlill purchased some smoke balls and used
them according to the directions and caught flu.
She sought to claim the stated 100 reward.
The defendant raised the following arguments to
demonstrate the advertisement was a mere
invitation to treat rather than an offer:
1. The advert was a sales puff and lacked intent
to be an offer.
2. It is not possible to make an offer to the world.
3. There was no notification of acceptance.
4. The wording was too vague to constitute an
offer since there was no stated time limit as to
catching the flu.
5. There was no consideration provided since the
'offer' did not specify that the user of the balls
must have purchased .
Held:
The Court of Appeal held that Mrs Carlill was
entitled to the reward as the advert constituted
an offer of a unilateral contract which she had
accepted by performing the conditions stated in
the offer. The court rejected all the arguments
put forward by the defendants for the following
reasons:
1. The statement referring to the deposit of
1,000 demonstrated intent and therefore it was
not a mere sales puff.
2. It is quite possible to make an offer to the
world.
3. In unilateral contracts there is no requirement
that the offeree communicates an intention to
accept, since acceptance is through full
performance.
4. Whilst there may be some ambiguity in the
wording this was capable of being resolved by
applying a reasonable time limit or confining it to
only those who caught flu whilst still using the
balls.
5. The defendants would have value in people
using the balls even if they had not been
purchased by them directly.
Low Kar Yit & Ors. v. Mohd Isa &
Anor [1963]
(The Law of Contract . Acceptance)
The defendant in this case gave an option to the
plaintiff as to buy a piece of land. The agent of
the plaintiff operated the option but the
defendant refused to sign the sale agreement.
The plaintiff sued for specific performance for
breach of contract.
Judgment
It was held that the option subject to a formal
contract to be drawn up and agreed upon the
parties, therefore it was a conditional option. The
option was merely an agreement to enter into an
agreement. Therefore, there was no legal binding
contract between the parties.
Based on S.7(a) provides that an acceptance must be
"absolute and unqualified" the purported acceptance
must be clear and unconditional. The modifications or
variations and it must not be accompanied with or
contain further conditions. Therefore there was no
contract.
Hyde v Wrench (1840) 49 ER
132 Chancery Division (Decided
by Lord Langdale MR)
(The Law of Contract . Acceptance v
Counter Offer)
The defendant offered to sell a farm to the
plaintiff for 1,000. The plaintiff in reply offered
950 which the defendant refused. The plaintiff
then sought to accept the original offer of 1,000.
The defendant refused to sell to the plaintiff and
the plaintiff claimant brought an action for
specific performance.
Held:
There was no contract. Where a counter offer is
made this destroys the original offer so that it is
no longer open to the offeree to accept.
FRASER v EVERETT(1889)
(The Law of Contract . Acceptance :
Reasonable time)
The contract was for shares. The P were expected
to mail the scripts of shares about the end of
March, and which if done so, the scripts would
have arrived on or before 23rd
April. However the scripts were mailed early in
April and received by the D on 15th May.
Held:
The acceptance of the P was not made within a
reasonable time. The scripts should have been
delivered much earlier, taking into consideration
that the shares in question were mining shares of
a very fluctuating character.