Seeking definitive clarification for 'misprices'

adam.mt

As I understand it advertised prices are an 'invitation to treat'.

If a product is advertised for the wrong price then the retailer can withdraw it from sale and correct the price; they aren't forced to sell at the advertised price.

However, if they take payment and provide a receipt is the contract now complete and what's the outcome if it's broken? So far, I've found this unclear (as I'm sure many others have) - Anybody able to clarify?

Say, you take the purchase home with you (or it's delivered) and subsequently they notice the mistake; can they insist you return the goods or pay the difference in the misprice? - I'd assume no, is this correct?

If the purchase is an order due for later delivery that you've already paid for, must they now supply the goods or if unable to compensate you for having to obtain the goods elsewhere? Or can they just cancel the contract, refund the money and leave it there? - I'd assume the former, but are unsure; anyone?
[edit: I actually meant the latter, ie. a refund will suffice. doh!]

I value the input of those more 'clued in' than me! If possible please quote reliable sources of evidence.

Thanks all. Just felt this could do with some clarification then the info could be made a forum sticky (which would obviously assist future queries).

Optimist

If its in your grubby little hands and you have paid for it then its yours, otherwise check the terms they tend to say something to the effect the contract isn't complete until despatch

bingo_bango

adam.mt wrote: »

As I understand it advertised prices are an 'invitation to treat'.

If a product is advertised for the wrong price then the retailer can withdraw it from sale and correct the price; they aren't forced to sell at the advertised price.

However, if they take payment and provide a receipt is the contract now complete and what's the outcome if it's broken? So far, I've found this unclear (as I'm sure many others have) - Anybody able to clarify?

The contract is complete, but exactly what are you referring to when you ask if IT is broken?

Say, you take the purchase home with you (or it's delivered) and subsequently they notice the mistake; can they insist you return the goods or pay the difference in the misprice? - I'd assume no, is this correct?

No they can't. Once the contract has been completed, you then take title of the goods.

If the purchase is an order due for later delivery that you've already paid for, must they now supply the goods or if unable to compensate you for having to obtain the goods elsewhere? Or can they just cancel the contract, refund the money and leave it there? - I'd assume the former, but are unsure; anyone?

This depends on how you paid. If this was a shop purchase, then arguably yes, but if it was a distance order, then the likliehood is no.


I value the input of those more 'clued in' than me! If possible please quote reliable sources of evidence.

Thanks all. Just felt this could do with some clarification then the info could be made a forum sticky (which would obviously assist future queries).

When you ask for reliable sources of evidence, it isn't as easy as that. The 'simple' question of what is a contract and when is it completed has been formulated by years of common law.

There are five elements necessary for a contract.

1. Offer
2. Acceptance
3. Consideration
4. Intention to create legal relations
5. Capacity to contract.

Each of these has been widely argued over hundreds of years to give us what we now understand to be the meaning of each.

There are of course statutes to give us some more defined clarity (such as DSRs) but not every individual's situation is as clear cut as it may appear at first glance. That's why we have the same questions (or what appear to be the same) repeated on the forum.

adam.mt

Thanks for the replies so far.

The contract is complete, but exactly what are you referring to when you ask if IT is broken?

I was referring to the contract being broken by (for example) either of the circumstances I mentioned.

bingo_bango

There is no legal situation where a contract is 'broken' as such.

It can be void: where there has been a mistake the contract is therefore void and in the eyes of the law it never existed. Please note that a mistake in this context is not so clear cut a definition as you may think. In this case, the title for the goods never passed from the seller, so yes, they would have to be returned.
For a seller to utilise this argument, there would have to be some impossibility relating to the mistake. e.g. they have agreed to sell you a Ferrari for £0.99 from a web advert. As a corner shop they would never be in a position to source a Ferrari, let alone sell it for that price and would likely claim that a mistake was made. It's the impossibility of performance that is important here, not the mistake itself.


It can be voidable: In this case the contract will continue (and title will pass to the buyer) until such times as they decide to end the contract.

Void, voidable and mistake are again all areas which have been through the courts on countless occasions.

4743hudsonj

Bingo Bango's reply was bang on there isnt really statute that lays out the law of contracts, just judicial precedent.

unholyangel

adam.mt wrote: »

As I understand it advertised prices are an 'invitation to treat'.

If a product is advertised for the wrong price then the retailer can withdraw it from sale and correct the price; they aren't forced to sell at the advertised price.

However, if they take payment and provide a receipt is the contract now complete and what's the outcome if it's broken? So far, I've found this unclear (as I'm sure many others have) - Anybody able to clarify?

Say, you take the purchase home with you (or it's delivered) and subsequently they notice the mistake; can they insist you return the goods or pay the difference in the misprice? - I'd assume no, is this correct?

If the purchase is an order due for later delivery that you've already paid for, must they now supply the goods or if unable to compensate you for having to obtain the goods elsewhere? Or can they just cancel the contract, refund the money and leave it there? - I'd assume the former, but are unsure; anyone?
[edit: I actually meant the latter, ie. a refund will suffice. doh!]

I value the input of those more 'clued in' than me! If possible please quote reliable sources of evidence.

Thanks all. Just felt this could do with some clarification then the info could be made a forum sticky (which would obviously assist future queries).

When paying in person, the contract exists once the money has been offered by the customer and accepted by the retailer (which obviously you should get a receipt for). So as long as they have accepted payment, they would need to provide the goods at that price or risk being in breach of contract.

Online it is different. They can take payment and cancel later, the reason for this is that it is automated and there has been no chance for a "employee" to review the offer and accept it.

undaunted

This was covered on a BBC3 know your rights type programme. Basically they said that once the shop had completed the sale tough, their loss & they couldn't come outside (as was the example case given) chasing them down the street to ask for correction of their error

adam.mt

Thanks all.

So, to clarify:
In person: money exchanging hands equals contract complete.
On-line: money being taken AND goods being delivered equals contract complete.

If in person they take your money before realising the mistake can they still cancel the sale, ie. if they refuse to hand over the goods (eg a misprice) is an offer of a refund sufficient? Or must they supply?

Obviously, if you've paid and been given the goods I assume they can't follow you down the road or contact you later asking for more money or the goods back. Correct? Similarly, if bought on-line once you've paid and the goods are delivered then they are yours, they can't try and charge you extra or demand you return them?

Are you sure it's not a case of "money being taken AND goods being delivered equals contract complete" for BOTH in store and on-line? That would seem to make more sense to me.

unholyangel

adam.mt wrote: »

Thanks all.

So, to clarify:
In person: money exchanging hands equals contract complete.
On-line: money being taken AND goods being delivered equals contract complete.

If in person they take your money before realising the mistake can they still cancel the sale, ie. if they refuse to hand over the goods (eg a misprice) is an offer of a refund sufficient? Or must they supply?

Obviously, if you've paid and been given the goods I assume they can't follow you down the road or contact you later asking for more money or the goods back. Correct? Similarly, if bought on-line once you've paid and the goods are delivered then they are yours, they can't try and charge you extra or demand you return them?

Are you sure it's not a case of "money being taken AND goods being delivered equals contract complete" for BOTH in store and on-line? That would seem to make more sense to me.

I cant imagine this situation would come up often due to the majority of places exchanging money and goods simultaneously. But for argument sake lets say argos, who take payment THEN deliver goods.....they would have provided you with a receipt prior to this which (imo) would be your "contract". Meaning they would have to provide the goods at the price paid.

Can anyone clarify?

bingo_bango

The important point is not when the goods themselves change hands, but when the title to those goods changes hands.

In the shop scenario (even if goods are to be delivered later) you make an offer to the store, they accept that (giving you a receipt as proof) and promise to deliver. At that point, they have passed title to the goods to the purchaser. It is too late at that point to change the contract. If they subsequently find that they can't supply the goods, then this is treated as an impossibility (a mistake voids the contract) and both parties are returned to a pre-contract stage (purchaser is refunded).

With the online scenario, the retailer will check that they have stock before sending it out. This allows them to ensure that they have the goods at that price. Because title does not pass in the goods until they have dispatched them, there is no contract to breach until that point.