Carlill v. Carbolic Smoke Ball Co. (1891-94) All ER Rep.127

This Case Summary is written by Ishanvi Jain, a student of Galgotias University, Noida

Introduction

The Plaintiff, believing Defendant’s advertisement that its product would prevent influenza, bought a Carbolic Smoke Ball and used it as directed from November 20, 1891 until January 17, 1892, when she caught the flu.  Plaintiff brought suit to recover the 100£, which the Court found her entitled to recover.  Defendant appealed.Carlil vs carbolic is notable for its curious subject matter and how the influential judges (particularly Lindley LJ and Bowen LJ) developed the law in inventive ways. Carlil vs carbolic is a contract case that is frequently discussed. In this casea 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. When sued, Carbolic argued the ad was not to be taken as a serious, legally binding offer. It was merely an invitation to treat, and a gimmick. But the court of appeal held that it would appear to a reasonable man that Carbolic had made a serious offer. People had given good “consideration” for it by going to the “distinct inconvenience” of using a faulty product. The Defendant, the Carbolic Smoke Ball Company of London (Defendant), placed an advertisement in several newspapers on November 13, 1891, stating that its product, “The Carbolic Smoke Ball”, when used three times daily, for two weeks, would prevent colds and influenza.  The makers of the smoke ball additionally offered a 100£ reward to anyone who caught influenza using their product, guaranteeing this reward by stating in their advertisement that they had deposited 1000£ in the bank as a show of their sincerity.  The Plaintiff, Lilli Carlill (Plaintiff), bought a smoke ball and used it as directed.  Several weeks after she began using the smoke ball, Plaintiff caught the flu.

Facts 

1. The Company published advertisements in the Pall Mall Gazette and other newspapersclaiming that it would pay £100 to anyone who got sick with influenza after using its product according to the instructions.
2. £100 reward will be paid by the Carbolic Smoke Ball Company to any person who will get caught by the cold or other diseases related to cold after having used the ball three times daily for two weeks, according to the printed directions supplied with each ball.
3. The plaintiff (Louisa Carlill) believing in the accuracy of the statement made in the advertisement , purchased one packet and used it thrice every day from mid-November, 1891 until 17th Jan, 1892, after that  date she had an attack of influenza. 
4. After that her husband wrote a letter for her to the defendants, stating what had happened, and asking for £100 as promised in the advertisement.

Issues raised

1. Was the ad a “mere puff”?
2. Does performance of the condition advertised in newspaper constitute acceptance of an offer?
3. Was there any consideration made?

Judgement

The court said that there is no time limit fixed for catching influenza, and it cannot seriously be meant to promise to pay money to a person who catches influenza at any time after the inhaling of the smoke ball. There is also great vagueness in the limitation of the persons with whom the contract was intended to be made. But this document was intended to be issued to the public and to be read by public and the effect of this advertisement was to attract people and make them use it, which would amount to more sales, thus more profit. Based on this intention to promote the distribution of the smoke balls and to increase its usage, the advertisement was accepted as a contract addressing public at large but limited to those people who are using it either for prevention or treatment of influenza and other mentioned diseases.

Defendant’s Appeal was dismissed, Plaintiff was entitled to recover 100£.
The Court acknowledges that in the case of vague advertisements, language regarding payment of a reward is generally a puff, which carries no enforceability.  In this case, however, Defendant noted the deposit of £1000 in their advertisement, as a show of their sincerity.  Because Defendant did this, the Court found their offer to reward to be a promise, backed by their own sincerity. The Court of Appeal unanimously rejected the company’s arguments and held that there was a fully binding contract for £100 with Mrs. Carlill.

Conclusion

The ad was an express promise to pay 100 pounds to anyone who contracts flu after using the ball three times daily, 2 weeks. The ad was not a mere puff because of this statement “1000 is deposited with the Alliance Bank, showing our sincerity in the matter” proof of sincerity to pay. Promise is binding even though not made to anyone in particular. A unilateral offer  i.e. “offers to anybody who performs the conditions named in the advertisement, and anybody who does perform the condition accepts the offer”. The ad is not so vague that it cannot be construed as a promise the words can be reasonably construed. For example, that if you use the remedy for two weeks, you will not contract the flu within a reasonable time after that.

Suggestion 

The advertisement was an offer to the world. It was contended that it is not binding. It was said that it was not made with anybody in particular. In point of law the advertisement was an offer to pay £100 to anybody who will perform these conditions, and the performance of the conditions is the acceptance of the offer. Communication of acceptance is not necessary for a contract when people’s conduct manifests an intention to contract. Unquestionably, as a general proposition, when an offer is made, it is necessary in order to make a binding contract, not only that it should be accepted, but that the acceptance should be communicated but in cases of this kind, it is apprehended that they are an exception to the rule that the communication of the acceptance need not precede the performance. This offer is a continuing offer. It was never revoked, and if notice of acceptance is required, then the person who makes the offer gets the notice of acceptance contemporaneously with his notice of the performance of the condition before his offer is revoked.