Carlill v Carbolic Smoke Ball Company
Court of Appeal
Citations: [1893] 1 QB 256.
Facts
The defendant sold a medicine which they called a ‘Carbolic Smoke Ball’. When they advertised the product, they stated that they would pay a sum of money to any person who used it and still caught influenza. They claimed that they had already deposited money with a local bank in preparation to meet such claims. The claimant saw one of these adverts and bought the product. However, despite using it properly, the claimant still caught the flu. The defendant refused to pay the money promised in the advert.
Issue(s)
- Had the promise to pay money if the claimant caught the flu become a binding contract?
Decision
The Court of Appeal held in favour of the claimant. The advert was an offer which the claimant accepted by purchasing the medication and using it as directed. The defendant was therefore bound to pay the claimant the money.
This Case is Authority For…
Adverts are normally invitations to treat rather than offers. However, this turns on whether a reasonable person seeing the advert would think that the advertiser intended to be legally bound by anyone who acted in accordance with the advert. In some cases, such as this one, an advert can be an offer. Relevant factors include:
- How vague the promise is;
- Whether the language indicates that the advertiser is merely soliciting offers or seeking to negotiate;
- Whether the language provides any guarantees or indicates seriousness and sincerity.
An offer can be made to the world at large: these are known as unilateral offers. Unilateral offers are accepted by performing as the offer demands. There is usually no need for the offeree to notify the offeror that he is performing. This is an exception to the rule that acceptance of an offer must be communicated to the offeror. It is justified by the fact that terms and language of the offer normally waive the need for communication.
Other
The defendant also tried to pass the promise to pay money as a ‘mere puff’. A mere puff is sales patter which reasonable people would not take seriously. Lindley LJ stated that this was inconsistent with the defendant’s claim to have deposited the money with a bank. That claim indicated to customers that the defendant was serious.
The court also had to consider whether the claimant provided any consideration for the defendant’s promise to pay. Lindley LJ argued that the benefit to the defendant was the fact that by making the promise, they were more likely to motivate customers to buy the product. Alternatively, he relied on the fact that the claimant inconvenienced themselves (by using the product) at the defendant’s request. Bowen LJ added that the mere use of the product was likely to indirectly lead to more sales. This also benefited the defendant.
