Question

Mark displays a bag in the window of his shop. He has a price tag annexed to the bag.
The price is stated as $1000. The price which Mark intends to sell the bag for is really
$10,000. He is charged with offering for sale products at a misleading price.
Advise Mark.

Answer

The facts in this case are that Mark displayed a bag in the window of his shop with a price tag of
$1000 annexed to it and is charged with offering for sale products at a misleading price.

The issue in this case is whether Marks action amounts to an offer or an invitation to treat?

An offer is an indication by one person that he or she is prepared to enter into a contract with one or
more persons on certain terms, which are fixed or capable of being fixed at the time the offer is made.
An offer is made with every intention of it becoming binding on the offeror as soon as it is accepted by
the offeree. This must be distinguished from an invitation to treat which refers to preliminary
communication or negotiation that may, or may not lead to a firm offer being made. It is an attempt to
discover another party’s interest and not with any intention of it being binding if the person to whom it
is communicated agrees to the terms. Therefore an invitation to treat cannot be accepted whereas an
offer is indeed capable of being accepted.

One such example of an invitation to treat is shop window displays. In the case of Fisher v. Bell D
displayed in his shop window a flick-knife with the price attached to it. He was charged with the offence of
offering a flick knife for sale. It was held that no offence had been committed by D because the display of
the knife was an invitation to treat and not an offer. In the words of Lord Parker CJ: “It is perfectly clear
that according to the ordinary law of contract 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.”

Based on the principle outlined in Fisher v. Bell therefore Mark cannot be charged with offering for sale
products at a misleading price because Marks actions did not amount to an offer but rather an
invitation to treat.