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Lefkowitz v Great Minneapolis Surplus Store Inc (1957) 86 NW 2d 689

FORMATION OF CONTRACT – OFFER OF SALE

Facts

The defendant placed an advertisement in the paper for the sale of fur, stating that it would be sold on a ‘first come first served’ basis. The claimant was the first to respond to the advertisement, but the defendant refused to sell on the basis that it was a ‘house rule’ to sell only to female customers. The claimant brought a claim for breach of contract, contending that the defendant was bound by its ‘first come first served’ promise.

Issue

The issue was whether the advertisement constituted an offer of sale (in which case the contract was completely formed upon the claimant's acceptance) or merely an invitation to treat (in which case there was no contract).

Held

Allowing the claim, the court held that a binding obligation on the defendant arose from the specific language of the advertisement. The test applied to distinguish an offer from an invitation to treat was that of mutuality of obligation: whether, on the facts of the case, a performance had been promised in return for a performance which was requested. In this case, the advertisement was an offer that the defendant would transfer the goods to the first person to respond, and as such, its terms could not be changed once it had been accepted and the contract was formed without the agreement of the other party. The defendant therefore did not have the right to impose new conditions which were not contained in the published offer after acceptance.


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