In England, a medical firm advertised that its new wonder drug, a smoke ball, would cure people's flu, and if it did not, buyers would receive £100. This case is probably the most famous case in the English contract law. How did it become such an example? There are two main actors in this case. 'The Carbolic Smoke Ball', a medical company which sells pills against different allergies and diseases, and Carlill, an English woman who bought this medicine. The problem exists in the way that Carbolic Smoke Ball Company promoted this product by arguing that buying and taking the pills during two weeks would prevent the body of their client not to suffer of any of these diseases. They would offer a financial amount (£100) for any client who, by having followed the specific treatment, suffers any of these diseases. Mrs. Carlill suffered and decided to sue the company.
[...] This case is a leading judgment from the English Court of Appeal in the law of contract. It is notable for applying and developing the English law of contract in inventive ways. Carlill is frequently discussed as an introductory case by first year law texts. It decided that people will be bound by promises made to the world at large to fulfill what they promise, so far as some element of "reliance" or "detriment" to the promise, or "benefit" to the promisor can be identified. [...]
[...] The proprietors of the medical preparation Carbolic Smoke Ball” decided to promote the product to the public by advertising in newspaper as for example the Pall Mall Gazette of November 13, 1891”. This advertising was saying the following statement: rewards will be paid to any person who contracts the influenza after having used the smoke balls in a specified manner and for a specified period.” The Carbolic Smoke Ball Company even deposited 1000 with the Alliance Bank, Regent Street, in order to show their sincerity in the matter. The plaintiff, Carlill is a lady who bought the pills at a chemist. [...]
[...] The Carbolic Smoke Ball Company. The Court of Appeal unanimously rejected the company's arguments and said there was a binding contract for £100 with Mrs. Carlill. The reasons given were that the advert was a unilateral offer to the entire world that satisfying conditions for using the smoke ball constituted acceptance of the offer, and that purchasing or using of the smoke ball constituted good consideration. They also mentioned that the company's claim that £1000 was deposited at the Alliance Bank showed the serious intention to be legally bound. [...]
[...] In reply to this decision, the Carbolic Smoke Ball Company directly decided to appeal. The new judgment has been given on the 7th December Court of appeal's decision The Carbolic Smoke Ball Company argued a second time, saying that the terms used in the ads were too wide, too formless in order to make any contract. They also argued that the plaintiff hadn't communicated her intention to accept the offer. According to them, all this leads to the conclusion that there was no contract's acceptance. [...]
[...] It's obvious, according to the court, that it was a public offer (published in a newspaper turned for the whole public) We know that when an offer is made to the entire world, in other words, when the target is not specific, there is no need of direct communication of acceptance. The only behavior in accordance with the specific terms of the advert is sufficient. Nothing can be imported beyond the conditions, in the case of a public offer like this one. The court said that Carbolic Smoke Ball Company must respect his financial promise, previously made, to anyone who acted as written in the advertisement. This promise was a way to increase sales of the company. This argument is clearly commercial. The company didn't expect reactions like this. [...]
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