Question

Business Law

A new hotel has advertised in the local newspapers that its ballroom is going for a cheap rate for the month of June. Patrick wants to make a booking of the ballroom for a party for his daughter, Mary’s birthday on the 25^th June. The hotel manager does not want to accept his booking. However the hotel manager is prepared to give an alternative room to Patrick at a lower rate. Patrick refuses to accept the alternate room and is threatening to sue the hotel for not abiding by the advertisement in the local newspapers.

Critically evaluate whether there is a contract between the hotel and Patrick. Justify the answers with the evidence from the law of contract.

Answer 1

ADVERTISEMENTS arev usually considered invitations to do or run  the business.

Generally, advertisements, catalogs, brochures, and announcements to the public related to the sale of merchandise at a specified price are not considered offers to enter into a binding contract. Rather, they are considered invitations to make a deal.

In the above siyuation,there is no contract between the hotel and Patrick.

An advertisement may be considered a valid offer if it has the following elements:

1. It is sufficiently definite in its terms (e.g. descriptions, quality, quantity, & price);
2. It is communicated to a specific person or persons
3. The circumstances surrounding the publication show that the advertiser has the intent to enter into a contract.
4. Many courts will look at the objective manifestation of the advertiser’s intent. In other words, the court will consider whether a reasonable person would read the advertisement and believe that the advertiser intended to form an agreement. The circumstances of the case are also considered.

IF the person who published the advertisement decides not to sell the advertisement as given,this would not count as a branch of contract.

From these points , it is clear that there is no contract between the hotel and patrick.