Invitation to Treat

Introduction
It is necessary to distinguish between an offer and an invitation to treat. An invitation to treat is a
preliminary statement, merely supply of information and often inducing negotiation. There is no
commitment to sell or offer which could be accepted.

HARVEY V FACEY [1893] AC 552

FACTS:

The case involved a dispute over the sale of a property (in Jamaica) and an alleged agreement
made via telegram correspondence.

Plaintiff: Will you sell us Bumper Hall Pen? Telegraph lowest cash price

Defendant: Lowest price for Bumper Hall Pen £900

Plaintiff: We agree to buy Bumper Hall Pen for the sum of nine hundred pounds asked by you
ISSUE:

The court had to determine whether there had been an offer and acceptance of that offer.
HELD:

The Privy Council decided that in the initial exchange of telgrams: the plaintiff was asking questions
about the property and clearly not making an offer to buy the property and defendant was simply
answering the second part of the plaintiff's question. The defendant entered into a discussion but did
not commit, so the defendnat's first telegram contained an invitation to treat not an offer.

The plaintiff's final telegram is the first unequivocal statement. However, because the defendant's
statement was not viewed as an offer the plaintiff was unable to answer by accepting. Therefore, this
telegram is essentially the plaintiff making an offer, which the defendant has chosen not to accept.

The case has been criticised as some argue that the defendant's telegram implied a promise to sell
for £900.

Today, the Law of Property (Miscellaneous Provisions) Act 1989 s2(1), requires contracts for the
sale of land to be writing and signed by both parties.
CARLILL V CARBOLIC SMOKE BALL CO. [1893] 1 QB 256
FACTS:

The defendant placed an advertisement stating: £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....

The plaintiff made a claim for the reward but it was refused. The defendant argued that the
advertisement: was mere puff, had not been addressed to specific persons and that the plaintiff had
not communicated notice of her acceptance.
ISSUE:

Had the plaintiff accepted the offer?

HELD:

The court dismissed the defendant's pleas.

It found that the advertisement was not mere puff as the defendant had explicitly stated money had
been set aside to make such payments. A reasonable person reading the advertisement would take
it to be a serious offer which amounted to a binding obligation. Although, an offer must usually be
addressed to specific person or class of persons, the advertisement was being made to anyone who
met the criteria set out and this was sufficient. Furthermore, the court held that the wording of the
advertisement meant the plaintiff did not have to communicate acceptance, as clearly the defendant
did not expect every customer to contact them on purchasing the item, rather only those who used
the product as directed and then caught influenza.

Therefore, the case established that advertisements can constitute an offer to the public at large and
can be worded to waive the need to communicate acceptance prior to a claim.