contract law Carl V carbolic smoke ball company 1893 1qb 256. court of appeal carnal V carbolic smoke ball company is an important case in contract law as an example of a unilateral contract as an early court of appeal decision on unilateral contracts it established many principles relating to such contracts it is also important in relation to whether advertisements can amount to an offer or whether they are an invitation to treat facts the defendant manufactured the carbolic smoke balls as a cure for flu they placed an advertisement in a newspaper which stated 100 pounds reward will be paid by the carbolic smoke ball company to any person who contracts the influenza after having used the ball three times daily for two weeks according to the printed directions supplied with each ball one thousand pounds is deposited with the Alliance Bank showing our sincerity in the matter Mrs Carlo purchased some smoke balls and used them according to the directions she then caught flu she sought to claim the stated 100 pounds reward the defendant did not pay out arguing there was no contractual obligation to pay Mrs Carlo bought an action to enforce their promise the defendant raised the following arguments to demonstrate the advertisement was a mere invitation to treat rather than an offer 1. the advert was a sales puff and lacked intent to be an offer 2. it is not possible to make an offer to the world 3. there was no notification of acceptance 4. the wording was too vague to constitute an offer since there was no stated time limit as to catching the flu 5. there was no consideration provided since the offer did not specify that the user of the balls must have purchased them the court of appeal held that Mrs Carlo was entitled to the reward the advertisement constituted an offer of a unilateral contract which she had accepted by performing the conditions stated in the offer the court rejected all the arguments put forward by the defendants for the following reasons one the statement referring to the deposit of one thousand pounds demonstrated intent and therefore it was not a mere sales Puff 2. it is quite possible to make an offer to the world 3. in unilateral contracts there is no requirement that the offery communicates an intention to accept since acceptance is through full performance 4. whilst there may be some ambiguity in the wording this was capable of being resolved by applying a reasonable time limit or confining it to only those who caught flu while still using the balls 5. the defendants would have value in people using the balls even if they had not been purchased by them directly carnal V carbolic smoke ball established one a newspaper advertisement could constitute an offer where it is specific enough and demonstrates an intention to be bound 2. an offer can be made to the world three there is no need to communicate an intention to accept a unilateral contract 4. in unilateral contracts acceptance takes place through full performance of the specified condition in summary facts Mrs Carlo used the smoke walls and caught flu the defendant refused to pay the reward offered in the newspaper advertisement ratio a newspaper advertisement can be an offer if it is specific enough and demonstrates intention other principles relating to unilateral contracts an offer can be made to the world no need to communicate an intention to accept a unilateral offer Acceptance in unilateral contracts is through full performance this video is part of a series of videos on contract law from www.e.laurosources.co.uk please subscribe to our YouTube channel www.youtube.com Laura sources it's free to do so and will help us to keep providing these videos check out our website which provides lecture outlines and case summaries see also www.e.laurivision.org.uk for revision games and quizzes thanks for watching