Lorna\'s Question PDF

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I - IssueL - LawA - ApplicationC – ConclusionIssue:The issue in this question is whether there is a legally binding contract between Nina and Lorna.Law:Based on the Contracts Act 1950 Section 2 (h), it states that an agreement enforceable by law is a contract. Based on the definition, it is clear th...

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I - Issue L - Law A - Application C – Conclusion

Issue: The issue in this question is whether there is a legally binding contract between Nina and Lorna. Law: Based on the Contracts Act 1950 Section 2 (h), it states that an agreement enforceable by law is a contract. Based on the definition, it is clear that all contracts are agreements but not all agreements are contracts. There are elements of contract which are offer, acceptance, consideration, capacity, intention, certainty and free consent. Section 2 (a) of the Contracts Act 1950 defines an offer or a proposal as when one person signifies to another about his willingness to do or to abstain from doing anything, he is said to make a proposal. Invitation to treat is not an offer but it is more likely an invitation from one party to another party to make an offer. The common example of invitation to treat such as advertisement, display of goods in a self-service shop or shop window display, tender, price list or quotation and an auctioneer inviting bids in an auction sale. This question is related to display of goods with price tags in a shop. One of the examples of invitation to treat can be refer to case study Pharmaceutical Society of Great Britain v Boots Cash Chemists (Southern) Ltd. Boots Cash Chemists were charges under the Pharmacy and Poison Act 1933 that it was illegal or unlawful to sell certain medicines that were not supervise by a registered pharmacist. The customer claims that it was an offence because it was argued that the sale was complete when the customer took the goods from the shelves and put into his or her basket. It was held by the Court of Appeal that the displays of goods on shelves are only invitation to treat and not an offer. Another case that can be referred to is Fisher v Bell. The defendant was charged under s. 1(1) of the Restriction of Offensive Weapons Act 1959 for displaying a flick-knife with price attached. But, the Court said that no offence had been committed because the display of the flick-knife was only an invitation to the customers to make an offer to buy. These two cases can be applied in the question between Lorna and Nina. As Nina interested to buy a brooch form the display at a shop owned by Lorna, this shows that Lorna’s display of goods is an intention to treat and intend to make an offer with anyone who decide to buy it. When Nina comes to the shop and asked Lorna to take out the display brooch as she wanted to buy it, it shows that she making an offer to a contract with her. However, in this case Lorna

refused the offer because the price displayed was wrong but Nina was upset and wanted to sue Lorna. Application: Applying to our current situation, it is clearly that there is no binding contract between Lorna and Nina. The act of Lorna displaying the goods with the price tags in her shop was only invitation to treat. Nina would make an offer when she was interested and wanted to buy and bring them to the counter. But, when Lorna told Nina that there had been mistake for the price of brooch as it was actually cost RM100, Nina argued and said Lorna had been offered the brooch for RM10 and must sell to her at that price. Even though the goods displayed had been tagged by certain price, the seller does not have to sell it at that particular price. It is up to Lorna whether to accept or not the offer made by Nina. If Lorna accepted the offer then only the contact is binding. But in this situation, Lorna refused to sell it to Nina. It is because Lorna put the brooch as the display goods just to make an invitation to treat for her customers. Conclusion: It is concluded that Nina cannot take legal action such as sue against Lorna because Lorna does not offered the brooch to Nina and never asked her to buy the brooch. Nina cannot sue Lorna because of invitation to treat....