CARLILL V. CARBOLIC SMOKE BALL CO.
(1893)
Carlill
v.
Carbolic Smoke Ball Co.
[(1893), 1 QB 256 (CA)]
Landmark
case in Contract Law
Author- Saumya Mishra, B.A.LLB(Hons), SS Khanna Degree College, University of Allahabad, Prayagraj
ABSTRACT
The Carlill
v. Carbonic Smoke Ball Co. was an appeal to the court filed on July 4, 1892
by the plaintiff, Mrs. Carlill. The judgement was decided by the queen`s bench
with the three honorable judges Lindley LJ, Brown LJ, and AL Smith LJ. This
case raised issues on contact law and it`s various other aspects such as
whether the contact was binding on the parties or not? Whether there an
acceptance of offer? Whether the advertisement was sufficient to form a
contact? Whether there was any consideration provided? Here in this case the
plaintiff was influenced by influenza, a disease, despite using the carbonic smoke
ball. The company had stated in the advertisement that whoever uses its smoke
ball in prescribed manner will not be affected by influenza and if anyone is
affect by it even after consuming the medicine then the company will reward 100
pounds to the aggrieved. The case involved many legal provisions such as
unilateral contract, this case explains about unilateral contract and
conditional contract, it also involved acceptance, offer, consideration and
communication. Judgement of this case was given on the favour of the plaintiff
explaining and expanding the contact law.
1.
PRIMARY DETAILS OF THE
CASE
|
Case NO. |
: |
1 QB 256 |
|
Jurisdiction |
: |
Court of Appeal in England and Wales |
|
CaseFiledon |
: |
July 4, 1892. |
|
Case Decided on |
: |
December 7, 1892. |
|
Judges |
: |
Lindley LJ, Bowen LJ and AL Smith LJ |
|
Legal Provision Involved |
: |
Unilateral Contract, Offer and
Acceptance, Consideration, Intention, Communication of Acceptance. |
|
Case Summery Prepared by |
: |
Saumya |
2.
BREIF FACTS OF THE CASE
The
defendant was a proprietor of a medical preparation in London, known as “The
carbonic smokeball”. It released an advertisement on November 13, 1891, it was
stated in the advertisement that if “The carbonic smoke ball” is consumed three
times a day for two weeks, it would prevent influenza, cold or diseases similar
to cold. It was further stated that the company reward 100to the person who got
influenza even after using carbonic smokeball in prescribed manner. The company
said in that advertisement that the company had already deposited 1000£ in the
Alliance bank on Regent Street for showing their sincerity. Mrs. Carlill, the
plaintiff got flu even after using the carbonic smoke balls in prescribed
manner. The husband of Mrs. Carlill, who as a solicitor, wrote a letter to the
company stating about Mrs. Carlill ill health and claiming 100£ as said in the advertisement but the company
refused to pay saying that the medicine was not used in the prescribed manner;
therefore, the plaintiff sued the company.
3.
ISSUE OF THE CASE
Following
issues were raised in the case:
·
Whether
there was a contact with binding effects on the parties.
·
Whether
there was a need for the plaintiff to her acceptance of the offer by the
carbonic smoke ball company.
·
Whether
accepting the terms us sufficient to form a contract.
·
Whether
there was any consideration on the part of the plaintiff for the reward of
100£ given by the defendant.
4. ARGUMENTS
OF THE PARTIES
Plaintiff
It
was contended that the promise made in the advertisement was not vague. The
offer was made in such a way that it ensures that if the medicine did not work
the company would provide 100 pounds to the aggrieved user. The deposition of money in the Alliance Bank
was also done to show the company`s sincerity in the matter of reward, hence
the intention of the company was very much clear. It was also contended by the
plaintiff that the action of sale the product and the money she paid for the
product to the carbolic smoke ball company amounts to consideration. It was
contended that the advertisement done by the company was not in such a way that
it was not empty but a unilateral contract; therefore, the company was obliged
to fulfill the conditions said the advertisement.
Defendant
It
was contended that the offer was not binding in nature, therefore, it was not a
valid contract. It was said that advertisements are vague to form a contract,
thus, the saying of the advertisement did not amount to promise. It was
contended that there was no time limit stated and no way to check that whether
the consumer had really followed the instructions. It was also contention that
the said contract lacks the requirement of the communication and acceptance of
the proposal, therefore, it is not a valid contract. The plaintiff did not mad
the company aware of her acceptance. It was said that the advertisement was
only a marketing strategy and there was no intention on the part of the company
to form any contract.
5.
LEGAL PROVISIONS
INVOLVED IN THE CASE
Unilateral
Contact
It
is also called single sided contract. It is an offer that is made to the world
at large without any notification of acceptance and the performance to the
offer is taken as acceptance. This contract face challenges in respect to
consideration i.e. money or anything valuable in exchange between the parties,
which is essential for a contract, but in unilateral contract only one party
makes a promise or reward to the other party. Acceptance to this contract is
through performance using the information provided in the contract. Court recognizes
this contract when the promise is clear, condition to accept the contract is
stated and performance as acceptance.
Offer
and Acceptance
Offer
is proposal to enter into a contract which shows the offeror`s will to the
terms proposed. In case of Carlill v. Carbolic Smoke Ball Co. offer was
made by the way of advertisement with the terms specified to reward 100 pounds.
Acceptance is the agreement of the offeree. Like in the above stated case the
acceptance was itself the performance of the terms stated in advertisement
Consideration
Consideration
is essential in contract. If consideration is not present in the contract the
contract will become invalid. Consideration can be money consideration as well
as something which can be valued in place of money. In Carlill v. Carbonic
Smoke Ball Co. case consideration was given as the amount paid for the
purchase of the medicine.
Intention
A
contact cannot be formed unless there is an intention to create a legal
relationship which is legally enforceable by law. There must be a legal
obligation and consequence if one party fails to fulfil his obligation.
Communication
of the Acceptance
Communication
of the acceptance is necessarily required in the contract. The offeree should
communicate his willingness to be in the contract. Communication can be
explicit or implied. In case of Unilateral contact, the communication is
implied i.e. performance of the terms of the contract is referred as
acceptance.
6.
JUDGEMENT
The
company ‘Carbolic Smoke Ball‘ lost the case at the Queen`s Bench. The court
held that the unilateral contact between the Carbolic smoke ball company and
Mrs. Carlill was binding and the company is obliged to pay 100 pounds to the
plaintiff
The
three judges give reason for their judgements as that the advertisement was not
a unilateral offer to all but restricted to those who perform the conditions
stated in the advertisement. Using of smoke ball was the acceptance of the
offer and purchase of the smoke ball is considered as consideration. The
company also said that it has deposited 1000 pounds in bank to show it`s
sincerity, hence the company is obliged to reward 100 pounds to the plaintiff.
7.
IMPACT AND SIGNIFICANCE
It was a
land mark case on contract law. This case stated that how advertisement cannot
be regarded as vague and empty promise and give rise to a conditional contract,
only binding those who performed according to the terms and conditions stated.
The court held that such an action by the party is taken as acceptance to the
contract. This case talked about various aspects of the contact law, such as
unilateral contact, offer and acceptance, consideration, intention, and communication
of acceptance. In this case it was seen that how a unilateral contact can look
like an advertisement and the advertisers should take proper precautions while
designing an advertisement. This case ensured the protection of the consumers
from misleading trade practices. This case made contact law clearer.
8.
CONCLUSION
Although
the case of Carlill v, carbonic smoke ball was based on fairness by
stating a company`s accountability regarding the promises it made to public its
public, the traditional contract principles which introduced risks for future
commercial communications. Courts since then have had to carefully balance
these principles to avoid misuse. The case made people aware about the legally
binding nature of the advertisement This case has a huge hand in the
development of the unilateral contact and law of contract. This case showed
that how misleading advertisements can be enforceable in the Court of law. This
case being landmarked is still used as precedent in various cases.
Carlill v. Carbolic Smoke Ball Co., 1893 landmark case, unilateral contract, English contract law, offer and acceptance, consideration in contracts, misleading advertisement case, consumer rights UK, contract law precedent, legal case on advertisements
Post a Comment