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Offer of Goods and Services to the Public or Invitation to Deal

Published online by Cambridge University Press:  12 February 2016

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Extract

The distinction between an offer and an invitation to deal is clear and its consequences are well-known. Whilst the former bestows upon the offeree the power to accept and thus to conclude the contract, the latter is only intended to elicit an offer which the tenderer is then at liberty to accept or reject. It is, by contrast, less simple to determine when we are faced with an offer or an invitation to deal, or which of these might alone apply according to the rules of one or other legal system.

In this paper we do not intend to touch upon the questions involved in an overture to a specified individual or an announcement of a reward to the public for the performance of some act, i.e., to the person who carries out the required act (although, as happens in English law, such a case also falls under contract and is not regarded as a unilateral promise effective in itself). Instead we shall deal with overtures to the public indicating that a person has goods or services to supply, which take the form of displaying wares in a shop window or in the interior of a shop (sometimes by inviting customers to utilize self-service facilities) or of distributing catalogues, price lists, handbills, advertisements, posters and the like.

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Articles
Copyright
Copyright © Cambridge University Press and The Faculty of Law, The Hebrew University of Jerusalem 1971

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References

1 In order to include both offer and invitation to treat in one term, a group of distinguished scholars employs “proposal”. See Schlesinger and others, Formation of Contracts (1968) 77.Google Scholar This term appears too close in meaning to “offer” and in fact is frequently used in the English speaking world synonymously with it. In this paper the comprehensive meaning is indicated by “overture”, “announcement” or “initiative”.

2 “Goods” is intended here to comprehend immovable property where pertinent.

3 See, e.g., Pollock, , Principles of Contract (13th. ed., 1950) 12Google Scholar; Winfield, , “Some Aspects of Offer and Acceptance” (1939) 55 L.Q.R. 455, 516 et seq.Google Scholar; Saxena, in Schlesinger, op. cit., p. 344 et seq., 350.

4 (1834) 6 C & P 499; 172 E.R. 1337.

5 Winfield, op. cit., at pp. 517–18.

6 But see by way of criticism Kahn, E., “Some Mysteries of Offer and Acceptance” (1955) 72 S.A.L.J. 246, 251 et seq.Google Scholar

7 Fisher v. Bell [1961] 1 Q.B. 394; Mella v. Monahan (The Times, Jan. 20, 1961). Odgers, F. J. in (1961) Camb. L. J. 11CrossRefGoogle Scholar observes that such a result is “a nonsense unintended by the legislature and baffling to the layman”. See also Partridge v. Crittenden [1968] 2 All E.R. 421. It was otherwise decided in Northwestern Gas Board v. Apsden [1970] Crim. L. R. 301, but that was because the case involved the application of the Trade Description Act, 1968, of which sec. 6 states expressly: “A person exposing goods for supply or having goods in his possession for supply shall be deemed to offer to supply them”.

8 [1952] 2 Q.B. 795.

9 At p. 802.

10 [1953] 1 Q.B. 401.

11 [1940] 1 All E.R. 356.

12 Hood v. Anchor Line [1918] A.C. 837, at p. 845.

13 Pollock, op. cit., p. 9 (“putting in our coin is the acceptance of a standing offer”); Salmond, and Williams, , Law of Contracts (1945) 96.Google Scholar

14 [1896] A.C. 325.

15 See also Smith J. in the South African case, Crawley v. Rex [1909] T.S. 1105. In the opposite direction for public notices and advertisements regarding plays and services, see two Canadian cases, Johnson v. Sparrow (1899) Q.R. 15, S.C. 104; Goldthorpe v. Logan [1943] 2 D.L.R. 519, O.W.N. 215.

16 [1893] 1 Q.B. 256, at p. 268.

17 See the judgments of Lord Campbell, C. J. and Wightman, J. in Denton v. Great Northern Ry. (1856) 5 E & B 860Google Scholar; 119 E.R. 701.

18 Ibid., at p. 704.

19 Pollock, op. cit., pp. 12–15.

20 Cit. supra, n. 7, at p. 424.

21 On the problem of the limits in which a public offer may be deemed to exist, see Part 3 C below.

82 [1947] 1 All E.R. 258. This case was distinguished by the Court of Appeal in Gore v. Van der Lann [1967] 2 Q.B. 31; [1967] 1 All E.R. 360, 365–66, 367–68.

23 [1891] 2 Q.B. 11, 19.

24 Lord Esher's considerations are linked with the well-known remarks of Lord Holt in Lane v. Cotton (1701) 12 Mod. 484: “Wherever a subject takes upon himself a public trust for the benefit of the rest of his fellow-subjects, he is eo ipso bound to serve the subject in all the things that are within the reach and comprehension of such an office, under pain of an action against him”. After citing the example of the smith who refuses to have a shoe put on a horse, he holds the smith liable “because he has made profession of a trade which is for the public good”, similar to that of the inn-keeper and carrier. (In connection with the smith, however, Baron Parke already expressed doubts as to the existence of a duty: Johnson v. Midland Ry. Co. (1849) 4 Exch. 367, 396).

25 See Lex unica, §6 Dig., furti adversus nautas, caupones, stabularios, 47, 5. See on this, Straccha, , Tractatus de mercatura (Lugduni, 1621), pars 1, n. 21Google Scholar; Casaregis, , Discursus legales de commercio (Venetiis, 1740), discursus 122, n. 23Google Scholar; discursus 190, n. 6 et seq. See also Marquard cited in the next note.

26 See for instance Covarruvius, Variarum resolutionum lib. III, cap. XIV, Operum omnium vol. II, p. 248 (Francoforte, 1598), who lays down the obligation of the person putting up commodities necessary for food and clothing to sell them to all who make demand, having regard to the public need to obtain the goods. Regarding ships and hotels, see Marquard, J., De jure mercatorum et commerciorum singulari (Francoforte, 1602) lib. II, cap. V, n. 36.Google Scholar

27 See Straccha, loc. cit.; Casaregis, op. cit., discursus 122, n. 23 et discursus 190, n. 6–10.

28 Cf. Massé, , Droit commercial (Paris, 1862) vol. III, n. 1458Google Scholar; Castellazzo, Toesca di, L'offerta al pubblico (Torino, 1903) p. 48et seq.Google Scholar

29 Supra, n. 4.

30 Supra, n. 3.

31 See generally on this matter, Raiser, L., “The Obligation to Serve in Monopoly Situations” in Kartelle und Monopole in modernen Recht (Cartel and Monopoly in Modern Law), II (Karlsruhe, 1961) 523et seq.Google Scholar, and the bibliographical references given there for certain countries. With regard to France in particular and the extensive legislation existing there, see Schlesinger, op. cit., pp. 361–63, as well as the references to the case law and literature, to which should be added Serna, , Le refus de contracter (Paris, 1967).Google Scholar

32 In contrast to Winfield, see also the observations of Kahn, op. cit., pp. 251 et seq. And see Wessel, , Law of Contract in South Africa (1951) p. 52et seq.Google Scholar

33 It should be noted that in the U.S.A., where in the absence of case law in the matter, the English position appears to be accepted in principle, it is nevertheless thought that the refusal of a shopkeeper to sell “because of dislike either of the customer or of the race of the customer” would not be welcomed by the courts. See Schlesinger, op. cit., p. 336. On the same subject, in connection with coloured people, public notices and advertisements of plays, see the Canadian case, Johnson v. Sparrow, supra, n. 15.

34 Op. cit., p. 518.

35 See also Unger, , “Self-Service Shops and the Law of Contract” (1953) 16 M.L.R. 369, 370.Google Scholar

36 Supra, Part 2, A.

37 Cit. supra, n. 7, at p. 399.

38 This did not, however, prevent the judge from adding later (at p. 400): “Approaching this matter apart from authority, I find it quite impossible to say that an exhibition of goods in a shop window is itself an offer for sale”.

39 See the observation of Odgers, referred to supra, n. 7.

40 See e.g., the information cited in Schlesinger, op. cit., pp. 372 et seq.

41 Although a public offer of goods or services without mention of price or charge may be reasonable (see infra, Part 3 F.), nevertheless with regard to articles displayed in a window or inside a shop the absence thereof might constitute a negative indication to facilitate drawing the conclusion that the article is displayed merely for purposes of decoration.

42 See, e.g., Hahlo, and Kahn, , The Union of South Africa (The British Commonwealth, ed. by Keeton, , vol. 5) 446.Google Scholar

43 Cf. Planiol, and Ripert, (and Esmein), Traité pratique de droit civil, VI, Obligations (Paris, 2nd ed., 1952)Google Scholar para. 128.

44 Op. cit., pp. 252 et seq. See also D.C.W[ilson] (1953) 10 N. Ireland L.Q., 117, 119.

45 Cf. Schlesinger, op. cit., p. 80, n. 9.

46 Cf. ibid., p. 336, n. 38.

47 Cf. Unger, op. cit., p. 370.

48 Cf. in Germany, Bögner, , “Der Kaufbeschluss in Selbstbedienungladen” (1953) Jur. Rundschau 417.Google Scholar

49 Cf. Lacombe, “La responsabilité de l'exploitant d'un magasin” (1963) 61 Rev. trim de dr. civ. 242, 273 et seq; Bonassies, in Schlesinger, op. cit., p. 365. Contra Tunc in (1962) 60 Rev. trim. de dr. civ. 305, 306; Savatier, R., n. J.C.P., 1962, II, 12547.Google Scholar

50 See, in France, Paris, December 14, 1961, J.C.P. 1962, II, 12547, aff'd Cass., Oct. 20, 1964, D. 1965, 62; Lacombe, loc. cit.

51 See Schlesinger, op. cit., p. 338.

52 See, e.g., Kahn, op. cit., p. 252; Wessel, loc. cit.

53 See sec. 7 II of the Swiss Code of Obligations as well as the literature and case law regarding Switzerland, Germany and Austria mentioned in Schlesinger, op. cit., p. 371 et seq.

54 Travaux de la commission de réforme du code civil, 1948–49, p. 674 et seq.

55 Supra, Part 2, C.

56 Similar criticism has been made by Unger, op. cit., p. 369 regarding wares display ed in a window. Cf. the considerations, although in the context of another legal system, advanced by Jhering in his famous essay, “Culpa in contrahendo”, in Jahrbücher für die Dogmatik des heutigen römischen und deutschen Privatrechts, IV (1860), at p. 95et seq.Google Scholar (and in Gesammelte Aufsätze, I (Jena, 1881), 327. at p. 410 et seq.).

57 This criticism was advanced, for instance, by Dr. B. Halevi in the Israeli committee referred to in Part 4, A infra.

58 Macneilj in Schlesinger, op. cit., p. 334 explains: “Bait advertising is the advertising of goods at an extremely low price with the intention of not selling them as advertised. When the customer comes in, the product is derided or he is otherwise dissuaded from buying it, and his attention is switched to other (higher priced) models, etc.”

59 Lefkowitz v. Great Minneapolis Surplus Store, 251 Minn. 188; 86 N.W. 2d 689 (1957).

60 But see the reservations expressed in French law as noted in Schlesinger, op. cit., p. 364 and n. 26.

61 (1970) Hatza'ot Hok 129.

62 This principle replaced in later Roman law the earlier one according to which the obligee was released even by giving something from the inferior of the sub-types comprehended in the contemplated type. The scholars dispute whether under Justinian law the new principle applied only to legacies or also to obligations. See Albertario, La qualità della specie nelle obligazioni generiche (1925) 23 Riv. dir. comm., I, p. 177et seq.Google Scholar; Perozzi, , 1st. di dir. rom. (Milano, 2nd ed., 1947) II, p. 127et seq.Google Scholar, Grosso, , Obligazioni (Torino, 3rd ed., 1966) p. 246et seq.Google Scholar

63 See. 1246 of the French Code; sec. 243 of the German Code; sec. 1178 of the Italian Code.

64 Cf. sec. 26 of the Bill of the Contracts (General Part) Law, above mentioned.

65 In the realm of agreement, see especially among other provisions sec. 6 of the Sales Law above mentioned; sec. 4 of the Hire Law; and sees. 12 and 41 of the Bill of the Contract (General Part) Law.