Question

Using the IRAC to solve the problem

James owns a small business that sells highly durable watches for hikers and manual labourers. He decided one day to take out two advertisements to entice customers to his products.

The first is a picture of the watch with the phrase “This watch can withstand anything you can or your money back for a limited time only!”. Three weeks after seeing the advertisement, Kate’s watch becomes waterlogged and malfunctions during a particularly heavy rainstorm. Kate approaches James for a refund and he refuses.

The second advertisement is a television commercial with a voiceover that states, “For every friend you refer to buy a watch, you can earn $10.00 cash on us!” The commercial shows images of a young man speaking to friends as a bank balance flashes on screen with higher and higher amounts up to $100,000.00. Natalie manages to refer 120,000 people to purchase watches through her Instagram page and seeks to claim the full cash amount. James refuses.

Advise Kate and Natalie of their rights.

Answer 1

Advertisement has become the backbone of marketing in the modern world and any business to survive and flourish require some kind of advertisements today. In the given case study James decides to advertise the products and along with it run some kind of offers and promotional events.

Now once these were advertised there was no disclaimer which was ran with such advertisements and as such would have been necessary to be published in case there are any terms or conditions associated. In this case Kate and Natalie have gone by what was advertised and in absence of any disclaimer they have a right to claim such offer or compensation.

In this case Kate can rightfully claim for full refund and also ask for any expenses which she will have to incur to get the same, along with Natalie who can claim the full amount as promised by the advert (assuming there was no disclaimer) and also go for claim in damages as caused by wrong advert in in society. As she had used her social links to gather the details and assist in increasing the sales which was later declined by James, The only concern in Natalie case will be that James will say that the audience were not attracted to product by Her insta page, so in this case if she can provide beyond doubt that those customers brought the watch only at her influence then she can also claim full amount.

To conclude this is a classic case of false advert and bot Kate and Natalie can claim the full amount as due in such cases.