Introduction
Advertising is a marketing communication channel used in most contemporary business transactions. It is applied to promote and sell merchandise (Armstrong 2010). When an interested party sees an advert and opts to buy the product, they enter into a contract with the seller. A contract is considered to be legal if it is based on the laws of an indenture.
In this paper, the author will determine whether there was a contract between Dennis and Julian. To assess this existence, various aspects will be taken into consideration in relation to the case presented. The facets include the elements of a contract, offers, and acceptance. The primary purpose of assessing the aspects of a contract is to determine whether or not Dennis breached the deal with Julian by selling the TV set to Simon. In addition, the author will advise Julian on contracts and appropriate legal steps to be taken when agreements are breached.
The Case Scenario and Laws on Advertising and Second Hand Goods
In a legal sense, advertisements are not offers. They are invitations to instigate negotiations. If advertisements were offers, it would be difficult to conduct business and publicise products. Dennis is selling his old television set. He put an advertisement in the local Hendon Times newspaper. The commercial included the price of the TV and his contacts. The move by Dennis is an invitation for a treat, as in Partridge v Crittenden1. If there was a reward for purchasing the TV, the advertisement would be considered as an offer, as in the case of Carlill v Smoke Ball Company2.
Upon seeing the advertisement, Julian contacted Dennis on a Monday. He was enquiring if he could go and see the product. The seller allowed him to check and inspect the TV before purchasing it. The opportunity accorded to Julian is an indication that Dennis respected the advertising laws. The laws state that merchandise must be of acceptable quality and in good condition. If the product does not meet the standards presented as advertised, the buyer has the right to return it to the seller (Andrews 2011). If the defects are minor, the dealer can repair the item. Alternatively, they can refund the money, as in the case of Jones v Just.3 In the current case, Julian inspected the product to ensure that Dennis was selling a quality second hand item. Given that the product met his expectations, he contacted Dennis, saying that “I will buy the TV, but for a lower price of £250”. By willing to buy the product at his own preferred price, Julian made an offer. According to Miller (2010), an offer takes place when a client proposes new terms with the intention of ensuring that the new conditions will form a legally binding agreement.
Advice to Julian
Upon inspecting the TV, Julian promised Dennis that he would buy it for £300. Dennis accepted the price. However, he stated that he would not include the HDMI cables. The new terms act as a counteroffer for the original deal proposed by Julian. A counteroffer is a response made to another offer, which was considered unacceptable, as in the case of Ward (RV) Ltd. v Bignall4. Dennis gave him a week to respond. However, the confirmation letter stating he was ready to buy the product never got to Dennis. As a result, it was sold to another customer, Simon. The fact that Julian wrote a letter and was given one week to respond reveals that there was an agreement between him and the seller. The reason is because the two had agreed that the item would be sold to another customer if there was no response from Julian by the end of the week. Before reselling it, Dennis made an effort to contact Julian. He wanted to tell him that the deal was off. Cancelling the deal was not a breach of the contract. The agreement was not legally binding. Elliott and Quinn (2007) note that when making deals, silence cannot be used to determine acceptance or decline, as in the case of Harvey v Facey.5
When Dennis put the advertisement in the local daily, he added his phone number. Julian used it to contact him and enquire more about the product. The two arranged for a meeting to inspect the item. After confirming that the TV was in good condition and worth the initial price indicated in the commercial, the two negotiated for a final offer via text and email. The interaction between them reveals that they could easily get in touch with each other (Miller 2010). Julian posted the letter first class on Tuesday morning. However, after sending it, he should have contacted Dennis to notify him. In addition, Julian should have written a confirmation email to the seller. When making agreements or contracts, it is important to make follow-ups (Elliott & Quinn 2007). The reason is to ensure that the deal is still on. If any changes arise before the agreement is finalised, the appropriate alterations can be made with the consent of all the parties involved.
Schatzberger (2014) observes that before purchasing goods from a second-hand dealer, it is important for the buyer to be aware of their rights. If the letter from Julian was received by Dennis, a number of procedures had to be taken before the purchase. For example, it is imperative to sign a sales agreement or a bill of sale, as in the case of Standard Brands v Consolidated Badger.6 The two agreements serve a similar purpose when making contracts. However, there are a number of differences between them. A sales agreement offers detailed information about the mode of payment to be used. In addition, it highlights the warranty of the product (Boros & Duns 2010). It is clear that the item on sale in this case is not new. As such, it could have minor or major faults that may become apparent once the buyer starts using it (Denoncourt 2012). When an appliance malfunctions, the buyer can return it or get a refund. When the defects are major, a reimbursement or a replacement is required. When the seller fails to do this, the buyer can fix the item and ask for a reimbursement of the money used in repairs from the dealer. However, for refunds to take place, the contract should be legally binding, as in the case of Fisher v Bell.7
A sales agreement makes it possible to conduct transactions smoothly. The document contains the total amount of money the item is sold at and the time to be taken to settle the full payment (Schatzberger 2014). The conditions must be fully understood by both parties, as in the case of Jones v Just.8 In addition, they have to be followed until the purchase process is complete (MacIntyre 2008).
Julian and Dennis could also have signed a bill of sale if the deal was not terminated. The bill is a document created by the seller to serve as a receipt for the goods sold. It contains information on the type of item sold, its location, and the money paid by the buyer. Both parties should fill out the document and retain a copy. The two forms should be signed to show proof of purchase and payment (Schatzberger 2010).
When taking part in another deal in the future, Julian should ensure that a bill of sale is signed. The document protects both the dealer and the consumer from any issues that may arise in the future, as in the case of Standard Brands v Consolidated Badger.9 The deal between Dennis and Julian was to be formalised using cash. In such instances, it is difficult to prove that a product was received or paid for. Such cases highlight the importance of proper documentation when making deals. A bill of sale proves that the buyer is the official owner of the product. It also shows that the item was acquired legally (Kubasek 2012).
In the case scenario presented, the letter by Julian to Dennis was the only written document to show that a purchase would be made. If Julian had already sent a down payment and Dennis still went ahead to sell the TV to Simon, it would be difficult to establish that a deposit was paid. A bill of sale serves as a receipt for both parties.
Conclusion
In the case between Julian and Dennis, various aspects of contracts, offers, and acceptance are presented. An offer is the first step when entering into legal and valid contracts. Armstrong (2010) notes that an offer is a communication that gives the parties the power to finalise a contract. Julian made an offer by stating the price of £250. On his part, Dennis made a counteroffer of 300 without including cables. In future, Julian should ensure that any deals he enters into follow legal procedures. In addition, they should be made in writing and be legally enforceable.
References
Andrews, N 2011, Contract law, Cambridge University Press, Cambridge.
Armstrong, J 2010, Persuasive advertising: evidence-based principles, Palgrave MacMillan, Basingstoke.
Boros, E & Duns, J 2010, Corporate law, 2nd edn, Oxford University Press, South Melbourne, Victoria.
Denoncourt, J 2012, Business law 2012-2013, 2nd edn, Routledge, Abingdon.
Elliott, C & Quinn, F 2007, Contract law, 6th edn, Pearson Longman, Harlow.
Kubasek, N 2012, Dynamic business law, 2nd edn, McGraw-Hill/Irwin, New York.
MacIntyre, E 2008, Business law, 4th edn, Pearson Longman, Harlow.
Miller, F 2010, Legal advertising, Alphascript Pub., Beau Basin, Mauritius.
Schatzberger, E 2010, Business law, Pearson Longman, London.
Schatzberger, E 2014, Blueprints: land law, Pearson Education, New York.
Case Sources
Burnett, R & Viviene, B 2009, Law of International Business in Australasia, Federation PR. (RV Ward v Bignall 1967)
Contract law page 2015, Partridge v Crittenden. Web.
House of Lords 1893, Harvey v Facey. Web.
Kimmel, E 1978, ‘Used goods and merchantability’, Tulsa Law Review, vol. 13, no. 3, pp. 627-645. Jones v Just 1867.
Irving, W 1950, ‘Sales-implied warranties in the sale of secondhand goods’, Marquette Law Review, vol. 34, no. 3, pp. 222-225. Standard Brands v Consolidated Badger.
Sixth Form Law 1960, Fisher v Bell. Web.
Footnotes
- Partridge v Crittenden [1968]
- Carlill v Carbonic Smoke Ball Company [1892]
- Jones v Just [1867]
- Ward (RV) Ltd. v Bignall [1967]
- Harvey v Facey [1893]
- Standard Brands v Consolidated Badger [1950]
- Fisher v Bell [1961]
- Jones v Just [1867]
- Standard Brands v Consolidated Badger [1950]