Law Of Contract

Invitation to treat & Offer

To- Mrs. Harshita
Thalwar
By- Arpita Thakur
What is an invitation to treat?

An invitation to treat is when you

Invite someone to make an offer.
 It is described as merely
delivering information to tempt
the other party to make an offer.
What Are Some  The most common example of an
Examples of an invitation to treat is a shop that
Invitation to places price tags on their goods, in-
treat? store or online.
  A have a clothing store mark sale prices on the jumper rack. He
accidentally put ‘Rs10.00’ on the price tag, when it should be
‘Rs100.00′. A customer picks up the jumper and is excited to
get a great bargain. So, they bring it over to him checkout to
purchase. Then he realise the mistake and tell the customer that
Example  - 1 the price is Rs100.00. The customer can then agree or decline
to purchase the jumper at that price. A do not have to honour
the marked price, as this was an ‘invitation to treat’. The
customer made the offer to purchase when they brought the
jumper to the counter. He can accept or decline this offer.
  Two of the important elements of a 
binding contract are offer and
How is it acceptance.
Different to an  An offer is a definite intention to be
Offer?
bound by a contract, whether that
be for the sale of goods or
services. 
  Offer
 Acceptance
Key Elements  Consideration
of a Binding
Contract  Intention
 Capacity
 By contrast, an invitation to treat is where you display information
about a good or service to entice people to make a purchase.
  You are essentially inviting the other party to make an offer, which
you can then accept or decline.
  The key factor will be whether the advertisement or statement was
intended to be an offer.
  Despite the current stance in courts on
advertising and marked prices being
‘invitations to treat’, vendors are still obliged to
Invitation to comply with the Australian Consumer Law.

Treat and   As a vendor, A is required to ensure that he do

Consumer not engage in misleading or deceptive conduct
or conduct that is likely to mislead or deceive
Law his customers.
  A must therefore be careful that his advertising
does not mislead or deceive customers, as this
is illegal.
 It is also important to consider whether not accepting an invitation to
treat as a result of A's advertisement creates goodwill for his business.

  A will unlikely have many happy customers if  he  consistently do not
honour his advertised price.
  If A operate an online shop, the process of offer
What About and acceptance looks a little bit different.

Online   It is generally held that prices  for  A's 

Shopping?  clothing online are an ‘invitation to treat,’
similar to brick and mortar stores.
  Suppose A is an online retailer for televisions.
One of his employees is listing televisions
online and accidentally marks the price of a
new television as Rs 3000 instead of Rs 30000.
Example -: An customer sees this price and quickly adds
the television to their cart. They are able to go
through the checkout process and pay the Rs
3000 for the TV.
  In this example, A and the customer would most likely
be aware that a mistake was made when A's employee
listed the price, rather than the vendor being purposely
misleading or deceptive. It is important that A's terms

Further and conditions specify that the customer’s offer is not

accepted until A accept the customer’s offer. 
Explanation  For example, A may only accept the customer’s offer
once he send them an email confirming their order. A can
avoid a costly mistake by clearly outlining when an offer
and acceptance are made in his terms and conditions
THANK YOU