Whether the Display of Goods Constitutes an Offer

According to the principle established in the Boots case, and the statement of Jill Poole, which is distinguished from the point of view which the court holds, the main issue here is whether the display of goods in a shop constitutes an offer or merely an invitation to treat, that is to say, who makes the offer, the shopkeeper or the customer? Then when is the contract concluded? At the time when the customer removes goods from the shelves and put them in the basket or when the customer presents the goods at the cash desk?

As I have done some research on the problem, there are a lot of controversies and disputes on this issue. Some of the authorities share the same opinion with the court ,while others argue in a opposite position.

From my point of view, generally, the display of goods in a shop does not constitute an offer but merely an invitation to treat .It is the customer who makes the offer at the cash desk where may be accepted by the shopkeeper.

However, in some particular situations, the general principle is probably not suitable to apply,and “less convincing in the light of modern regulation of trading practices.” [J.Beatson, Anson’s Law of Contract (28th edn Oxford,2002) 33

Here I will discuss the reasons for the both sides.

General approach established in Boots and reasons

In Pharmaceutical Society of Great Britain v Boots Cash Chemists(Southern) Ltd [ [1953] 1 QB 401], some drugs are prevented to be sold without the supervision of a registered pharmacist, which means it’s essential to decide whether the sale is under the supervision of the pharmacist when the contact is completed ,therefore, the key point is to identify who makes the offer and when the binding contract is concluded.As Somervell LJ mentioned, “if the plaintiffs are right ,once an article has been placed in the receptacle the customer would have no right,without paying for the first article, to substitute an article which he saw later of a similar kind and which he perhaps preferred.” [Boots(n 2)]

If I stand in the position of a customer,I will agree that some undesirable and inconvenient consequences may occur , if we regard the display of goods as an offer ,and the customer is bound at the time removing goods from the shelves. Because that may limit a customer’s freedom to change his mind and to choose another one later, thus a customer may be under a lot of pressure when going around a shop and feel inconvenient.

What’s more , to see from a shopkeeper’s position, it is believed that a shop is “a place for bargaining and not for compulsory sales“ [ Winfield (1939)55L.Q.R.499,518.], which means that if we regard the display of goods in a shop as an offer , the shopkeeper’s freedom to bargain will be taken away.

Furthermore, another reason given by Ewan Mckendrick why we should not regard the display as an offer is that “this conclusion is undesirable because it takes away the freedom of the shopkeeper to decide whether or not to deal with a particular customer.It would compel the shopkeeper to trade with his worst enemy.” [Ewan Mckendrick, Contract Law (4th edn Palgrave,2000)34] In other words, if the display of goods in a shop constitutes an offer, the shopkeeper is bound and he has to deal with every customer who comes to accept the offer, even if the customer is someone the shopkeeper hates and he doesn’t want to sell anything to the customer, which is somewhat unfair to the shopkeeper.

In addition, according to what J.Beatson has said in his book, “for this conclusion is that otherwise the shopkeeper would be obliged to sell to every person who accepted such an “offer”, even where supplies had run out” [J.Beatson ,Anson’s Law of Contract (28th edn Oxford, 2002) 33]. I share the same view that to treat a display of goods as an offer might make the shopkeeper bound to a couple of contracts which he would be unable to fulfill, if sometimes the supplies have run out or some goods have not arrived at the shop yet, and the shopkeeper can not fulfill the order to the customer, it may result in a breach of contract which is an undesirable situation to the shopkeeper.

For instance, as what has been explained in Lord Goddard CJ’s judgement, if we take the books on shelves as an offer that may “prevent the shopkeeper,seeing the book picked up, saying: 'I am sorry I cannot let you have that book, it is the only copy I have got and I have already promised it to another customer’.” [ Boots(n 2)] Thus, the freedom and convenience of the shopkeeper is unable to be protected.

In Fisher v Bell [[1961] 1 QB 394], the general rule that goods displayed in shop windows amounts to an offer is illustrated, where a flick-knife was displayed in the shop window with a ticket sating “Ejector knife-4s”. The seller was prosecuted under the Restriction of Offensive Weapons Act 1959, which claimed it an offence to offer to sell such things, and finally was acquitted .According to Lord Parker, ”it is clear according to the ordinary law of contract that the display of an article with a price on it in a shop window is merely an invitation to treat. It is in no sense an offer for sale,the acceptance of which constitutes a contract.” [ Fisher(n 8)] To be short,goods displayed in a shop window with a price ticket attached was not an offer but merely an invitation to treat.

As I’ve discussed above, as a general approach, a conclusion may be drawn that the display of goods only amounts to an invitation to treat but not an offer, then it is the customer who makes the offer to the shopkeeper, and the offer occurs when the customer presents the goods at the cash desk, where it may be accepted by the shopkeeper.

The reasons may be summarized as follows: to protect the freedom of the shopkeeper to bargain and to select his customer, to realize the right of a customer to change his mind ,and to avoid some inconvenience and unfairness .

Controversy and problem

However, in some particular situations, the display of goods may constitute an offer if terms that indicate an intention to be bound exist.

For instance,in the cases of “special offer”, According to Paul Richards, ”the rule could nevertheless produce some startling effects…” [Paul Richards, Law of Contract (9th edn Pearson Longman,2009)18 ], if we adopt the principle that the customer makes the offer and the shopkeeper is not legally bound by the display of goods ,then the shopkeeper could refuse to sell the goods to a customer even if they offered certain goods for sale and wrote the words “special offer” across the windows.The words “special offer” may attract a person to wait outside the shop all night maybe in a extremely cold winter,only to be told next morning that their offer to buy had been rejected, which may be obviously unfair to the customer who has been wait for a long time in a extremely cold winter.

Besides, sometimes policy reasons may be taken into account. If it were made clear that the shopkeeper was willing to sell to anyone paying the displayed price, then it is possible to treat the display as an offer,as explained in the conclusion in Chapelton v Barry Urban District Council [[1940] 1 KB 532], a display of deckchairs constituted an offer. Before a ticket including an exemption clause was issued, it’s stated that the contract to hire the deck chair could already have been concluded .On this basis, when the deckchair collapse and injury was caused to the hirer, the exemption can not protect the local council from liability. ”Thus,there may have been policy reasons which explain why the display was treated as an offer in this case.” [Jill Pole,Textbook on Contract Law (9th edn Oxford, New York 2008)48]

Further, some American authorities have disputed the general principle lying in the Boots case. In Lasky v Economy Grocery Stores [ 65 NE 305 (1946)], the plaintiff remove a bottle of “tonic” from the shelf in a self-service shop owned by the defendant. When she was about to place it in the basket ,the bottle exploded and she was severely injured. It was argued that the goods displayed amount to offers but “the acceptance took place, not on the placing of the goods in the basket ,but on the customer presenting them at the cash desk for payment.”[ Paul Richards, Law of Contract (9th edn Pearson Longman,2009) 19]. According to this,when a customer was injured by an bottle of tonic water which explodes at the cash desk, he was able to claim for his damages under the contract with the shopkeeper.

What’s more,despite the general principle adopted by the court, “the reasoning behind the general rule is somewhat obscure and lost in the mists of time.”[ Paul Richards,Law of Contract (9th edn Pearson Longman,2009) 18] In other words,the rule is probably not appropriate today when bargaining and haggling are not as common as before.

Furthermore, some problems may arise with the general principle.

On one hand,”such freedom has the potential to be used in a discriminatory way. “[ Richard Stone, The Modern Law of Contract(8th edn Routledge-Cavendish,2009) 49] In other words, if a shopkeeper is so free to bargain with a selected customer,some types of discrimination may occur, for example, of race, sex and disability which have been made unlawful by statute as a matter of social policy. A shopkeeper who discriminates on prohibited grounds in selecting customer to enter into a contract is not bound by the common law to undertake the contractual obligation.

On the other hand, practice of the general principle that parties are free may lead to the situation that “a shopkeeper is not bound by any price that is attached to goods displayed in the shop or in the window.”[ Richard Stone, The Modern Law of Contract (8th edn Routledge-Cavendish,2009) 49]For example,a customer is ready to buy a item at a certain price,but shopkeeper may say that the price is a mistake and claim a higher price. However, there is a conflict with the criminal statutory position,such action of the shopkeeper would constitute a criminal offence under the Consumer Protection from Unfair Trading Regulations 2008 [SI 2008/1277]. But that does not help the customer with his civil action and he still can not seek for a civil remedy.

Conclusion

As analysed above,from my point of view,it is partly convincing to adopt the general principle that the display of goods does not constitute an offer, and it is the customer who makes an offer when presenting the goods at the cash desk.

Indeed, the general rule can protect the freedom of the shopkeeper to bargain and select a customer. Moreover, it also allows the customer to change his mind before payment for the goods.

However, in some situations,such as the “special offer”,if the general principle is still applied, inconvenience and unfairness may occur as the shopkeeper can freely refuse to offer to sell. Besides, the shopkeeper may change the price and not bound by the marked price and too much freedom of the shopkeeper may lead to discrimination .