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Carlill v. Carbolic Smoke Ball Company

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Carlill v. Carbolic Smoke Ball Company, [1893] 1 Q.B. 256 (C.A.), is a contract case that questions whether an advertisement could be construed as a contract offer, and, if so, what would be the proper form of acceptance?

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Contents

Summary of Case Facts

Defendant Carbolic Smoke Ball Company ran an advertisement in a newspaper claiming that regular use of their Carbolic Smoke Ball, as directed, would prevent any user from contracting influenza (“the flu”). To reinforce that claim, the advertisement offered to pay any Carbolic Smoke Ball user who contracted the flu a sum of £100. To indicate the seriousness of their offer, they stated that £1000 had already been deposited in an account with a local bank to pay any claims. Plaintiff Louisa Elizabeth Carlill purchased a Carbolic Smoke Ball and used as directed. Unfortunately, the plaintiff contracted the flu and presented her claim for the £100 reward from the advertisement to the defendant. The defendant refused to pay and, as a result, the plaintiff brought this suit for damages arising from breach of contract.

Issue

Can an advertisement be construed as a unilateral offer inviting acceptance to form a contract?

Holding and Law

Yes. The court held that an advertisement could be construed as a unilateral offer to the entire world. The court went further to determine that where an offer is made with the intent to sell more goods, notification of acceptance of the offer is not necessary, and that performance of the condition sought by the offeror would be sufficient. In this case, use of the Carbolic Smoke Ball as directed (along with eventual contraction of the flu) constituted the performance of the condition in the offer and acceptance of the offer – resulting in a contract. The court even determined the price paid by the defendant’s customers for the Carbolic Smoke Ball to be consideration.

Addressing the defendant’s argument that the advertisement was mere puffing, or puffery, the court stated that where an advertisement contains language underscoring the sincerity of the offer (i.e. £1000 has been deposited in a local bank account) it is very plainly a promise to pay.

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