Grainger & Son v Gough [1896] AC 325 HL
FORMATION OF CONTRACT
Facts
The defendant wine merchant circulated a catalogue which contained a price list for its products. The claimant ordered a number of bottles of wine from the catalogue and, when the defendant refused to deliver these at the stated price, alleged that a contract had been formed.
Issues
The issue was whether the price list constituted an offer to sell wine at a certain price (in which case the contract was fully formed and the claimant had a valid claim), or an invitation to treat (in which case no contract had been formed).
Decision/Outcome
Rejecting the claim, the House of Lords held that the price list must be construed not as an offer, but as an invitation to treat. In reaching this conclusion, it reasoned that to interpret the list as an offer would mean that in theory the defendant would be obliged to deliver an unlimited quantity of wine at the stated price, upon receipt of an order. This would be unreasonable, and would not reflect the intentions of the parties as the merchant’s stock is necessarily limited, and it would not be possible for him to carry out such an order. Both reasonableness and objective intention are key to distinguishing between an offer and an invitation to treat. On this basis, the list was interpreted an invitation to customers to offer to buy wine at the stated price, which the merchant may then accept or reject. In this case, the defendant was not bound to deliver the wine ordered by the claimant.
Words: 257
Updated 19 March 2026
This case summary remains accurate. Grainger & Son v Gough [1896] AC 325 is a foundational House of Lords authority on the distinction between an offer and an invitation to treat in contract formation, and it has not been overruled or materially affected by subsequent legislation or case law. The principles described — that a price list or catalogue ordinarily constitutes an invitation to treat rather than an offer, to avoid exposing a seller to unlimited obligations — continue to be applied in English contract law and are regularly cited in academic and judicial contexts. Students should note that the case is frequently discussed alongside later authorities such as Pharmaceutical Society of Great Britain v Boots Cash Chemists (Southern) Ltd [1953] 1 QB 401 and Fisher v Bell [1961] 1 QB 394, which further develop the invitation to treat principle in different commercial contexts.
