When is a contract entered into

BobQ
BobQ Posts: 11,181 Forumite
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in Consumer rights
As I understand it, if you go into a shop and see something you want to buy on offer at a bargain price, and offer to but it, the shop can take your payment at which point there is a sale or can refuse your payment and so there is no sale.

But what is the situation with an online payment using PayPal. Up to what point can a supplier refuse the sale, and at what point is it purchased? In the case of an online purchase the process is usually automatic so the supplier would find it difficult to refuse the sale until payment was accepted.
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Comments

  • Fosterdog
    Fosterdog Posts: 4,948 Forumite
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    It will depend on what is specified in the terms on each individual retailer. Most choose to accept the contract at the point of dispatch as that allows and involves a person physically checking the stock against the order ready to send. Up until that point it is mostly automated so unlikely to accept at that point even if payment has already been made.
  • unforeseen
    unforeseen Posts: 7,280 Forumite
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    Read the t&C's of the company. There are slight differences in when the contract is deemed to be made. By accepting the t&C's and going ahead with the order then you have accepted their definition.
  • boliston
    boliston Posts: 3,012 Forumite
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    If you have received the goods probably a bit late to cancel the sale but they can cancel if goods not yet dispatched if it was caused by an error
  • bris
    bris Posts: 10,548 Forumite
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    Obvious mistakes are never legally binding as one of the key points to offer and acceptance is consideration.


    As you already know online sales are very much automated now but a computer can not enter into a contract. So when the human get's a chance to see what has happened they tend to refuse the order for various reasons.


    You have to ask yourself would anyone ever consider selling a Ferrari for the price of a Skoda?


    Not sure what your actual issue is but unless details are given there is no way to really give you an answer.
  • angryparcel
    angryparcel Posts: 926 Forumite
    edited 19 June 2017 at 8:37AM
    It also depends on the business.

    I run a services business and the whole process is automated, from the order being placed through the anti fraud checks to an account placed on a server giving a live website.
    at the checkout stage a user must tick a box saying they have read and understood our TOS, if they dont tick then they cannot proceed.
    but i class the contract starts as soon as an account is set up on a server as that is when they start using resources
  • unholyangel
    unholyangel Posts: 16,863 Forumite
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    A contract is entered into when all the necessary elements are present.

    The simplified version is offer + acceptance = contract (theres more to it than that, such as consideration, certainty, capacity to contract etc but thats it in a nutshell). And then of course you have conditional contracts.

    If all the necessary elements aren't present then there can't be a contract (even if T&C's say the contrary).
    You keep using that word. I do not think it means what you think it means - Inigo Montoya, The Princess Bride
  • unforeseen
    unforeseen Posts: 7,280 Forumite
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    But contract law allows that process to be modified if both sides agree which is where t&C's and TOS come in. You normally have to tick a box to say you agree with them before you can click the buy button.

    Once you click you have agreed to the new definition of when the contract is formed
  • unholyangel
    unholyangel Posts: 16,863 Forumite
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    unforeseen wrote: »
    But contract law allows that process to be modified if both sides agree which is where t&C's and TOS come in. You normally have to tick a box to say you agree with them before you can click the buy button.

    Once you click you have agreed to the new definition of when the contract is formed

    It allows parties to say that a contract is (for example) conditional upon a signed contract, but it doesn't actually allow the process/what the required elements are to be modified.

    Also, ticking a box to say you've read & understood is largely useless in a consumer contract due to unfair term legislation. Its purpose is to have consumers agree those conditions have been met regardless of whether they actually have - which goes against the purpose of the unfair terms themselves. You need to highlight important terms (especially which are onerous in nature) to the consumer, not just bury them in small print and have the consumer sign a disclaimer.
    You keep using that word. I do not think it means what you think it means - Inigo Montoya, The Princess Bride
  • angryparcel
    angryparcel Posts: 926 Forumite
    unholyangel wrote: »
    Also, ticking a box to say you've read & understood is largely useless in a consumer contract due to unfair term legislation.
    Well my TOS and my process was approved by my Local Trading Standards to make sure it all complies with current legislation and they dont have any problem with a tick box to say they have read and understood the TOS as long as the TOS is available for them to read as you cannot force anyone to read TOS
  • unholyangel
    unholyangel Posts: 16,863 Forumite
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    edited 19 June 2017 at 2:35PM
    angryparcel wrote: »
    Well my TOS and my process was approved by my Local Trading Standards to make sure it all complies with current legislation and they dont have any problem with a tick box to say they have read and understood the TOS as long as the TOS is available for them to read as you cannot force anyone to read TOS

    CMA's updated unfair term guidance
    ‘Have read and understood’ declarations
    5.34.5 Declarations that the consumer has read and/or understood the agreement
    give rise to special concerns. The legislation implements an EU Directive
    saying that terms must be plain and intelligible and that consumers must
    have a proper opportunity to read all of them (see part 2 of the guidance
    under the heading ‘the Transparency test’ at paragraphs 2.42 and
    following). Including a declaration of this kind in a contract effectively
    requires consumers to say that these conditions have been met, whether
    they have or not. This tends to defeat the purpose of the Directive, and as
    such is open to serious objection.

    5.34.6 In practice consumers often do not thoroughly read standard written
    contracts. There is no justification for requiring them to say they have done
    so whether they have or not.     The purpose of ‘a read and understood’
    declarations is clearly to bind consumers to wording regardless of whether
    they have any real awareness of it. Such statements are thus open to the
    same objections as provisions binding consumers to terms they have not
    seen at all – see paragraph 10 of the Grey List (see paragraphs 5.20.1 to
    5.20.4).

    5.34.7 What such declarations do not do, which needs to be done, is effectively to
    draw attention to any important terms that could otherwise come as a
    surprise to the consumer. Unless such terms are properly flagged up, they
    are unlikely to be binding on the consumer.     An appropriate warning that the
    consumer should read and understand terms before signing them can
    contribute to the transparency of the terms in question, in the interests of
    both parties. This is subject to the proviso that the terms are clear, allowing
    the consumer to understand the practical significance of what is said in
    them, and that reading them is likely to be practically feasible for a
    consumer in the circumstances.

    And just in case you're in any doubt, the accompanying annex A gives examples of actual terms that retailers were made to change or remove due to them being considered in breach of unfair terms:
    Annex A
    Original term
    I/We have read the Conditions of Sale overleaf and agree to be bound by
    them.

    Action taken
    New term: Before signing this order, the customer should carefully read the terms
    and conditions set out on the other side of this agreement.
    You keep using that word. I do not think it means what you think it means - Inigo Montoya, The Princess Bride
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