A few days ago I was asked to teach as a replacement lecturer for the subject Contract Law. The last time I taught in that same college was about one and a half years ago. So I had to read up the related textbooks and past notes. Among others, while reading some of the updated journals and periodicals, I discovered an interesting case analysis. If an advertisement in a newspaper, billboard, catalogues and display is accepted as an invitation to treat, wouldn’t it make sense the same applies to web advertisement? I am wrong. By the way ‘an invitation to treat’ simply means that the vendor/seller is inviting an offer from the purchaser, thus making vendor as the acceptor if there is a deal ie legally binding contract.
In a landmark case of Digiland in Singapore, the court deliberated that web advertisement trading services is a case of an offer, mainly due to the irrelevance of the limited stock argument. That is to say if I advertise something to sell in the internet (an offer), once there is a buyer accepted and agreed with the price and condition, there will be a binding contract. I will be liable if I failed to provide the said goods to the prospective buyer. The court asserted that the risks of web contracting, ie the limited stock and price error are to be addressed by vendors. In practice vendors can protect themselves either through the use of qualification in their ad or by using the necessary technical mechanisms, such as stock control.
I beg to differ from the above decision. There is no reason why the law should not treat vendors of web advertisement and vendors of tv or paper advertsiement equally. The approach of requiring web vendors to protect themselves presents potential danger in situation where vendors fail to put up the qualification, which may occur out of negligence or ignorance. Such will also expose the web vendor to the risk of unlimited liability. It is also unreasonable to expect them to use technical mechanism in stock control of their goods advertised. In short, I view that web vendors are not making an offer in their ad but merely an invitation to treat.
It is not clear what will be the precise position in Malaysia as there is yet to be such similar case decided in court. Nonetheless, the issue is quite adequately covered by section 2(a) of the Contracts Act 1950 that defines the meaning of an offer (proposal) which extends to web communication. It reads “when one person signifies to another his willingness to do or to abstain from doing anything, with a view to obtaining assent of that other to such act or abstinence he is said to make a proposal (offer)”. Hence without an indication of a binding intention, a web ad can be considered as a case of invitation to treat. Can I make an offer in this blog?
andyyong
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