Question

Tutorial 4 (Assessment 1.2) 1 Distinguish whether the following is an offer or an invitation to treat: i) An advertisement which states that $500 will be rewarded for finding a lost dog. ii) A display of clothes in a shop window marked "Special Offer". iii) A second hand car advertised for sale in a newspaper iv) A person who bids for an antique vase by raising his hand in an auction. 2. Emily saw a "Monchichi" doll at a discounted price of HK$100 in a shop. She took it to the cashier for payment. However, the shopkeeper Harvey told her that the price of the "Monchichi" doll was wrongly labeled and should be changed to HK$300. Emily insisted on buying at the labeled price but Harvey refused. Discuss the legal position of each party.

Answer 1

1. An invitation to treat and an offer can be differentiated on the basis of the intention of the parties while making an invitation to offer or an offer. When the promisor makes an offer, he intends to enter into the legal relationship with the acceptance of the offer by the promisee. Whereas, in invitation to treat the persons intends other party to make an offer and he/she shall accept the offer made.

• Invitation to treat
• Invitation to treat
• Advertisements are typically an invitation to treat because they lack the important information that would make it an offer.
• Calling for bids is usually an invitation to treat and when someone make a bid that person is making an offer, which the auctioneer can either accept or reject.

2. According to common law,

23(6) Subject to subsections (7) to (10), a supplier must not require a consumer to pay a price for any goods or services—

(a) higher than the displayed price for those goods or services; or

(b) if more than one price is concurrently displayed, higher than the lower or lowest of the prices so displayed…

23(9) If a price as displayed contains an inadvertent and obvious error, the supplier is not bound by it after  

(a) correcting the error in the displayed price; and

(b) taking reasonable steps in the circumstances to inform consumers to whom the erroneous price may have been displayed of the error and the correct price.