§ 2.7 N1 Offers at the Supermarket or Self-Service Shop

Merchandising in modern supermarkets and other self-service stores poses the question of whether goods placed on display with a marked price are offered for sale or are they there merely as invitations to bargain? Apparently no case has been reported where the seller has refused to sell at the marked price. The issue has arisen in two contexts which, because they involve policy matters the gravamen of which are in criminal law and tort are not very illuminating for present purposes. In an English case the British Pharmaceutical Society attempted to make war upon a self-service drugstore by charging it with criminal violation of a statute requiring certain listed poisons to be sold by, or under the supervision of, a registered pharmacist. The argument was that a sale was effectuated when the customer accepted the seller's offer by removing a product from the drugstore's shelves. The court disagreed, holding that the offer and acceptance took place at the check-out where a pharmacist supervised the process.n2

The American cases revolve around exploding soda-pop bottles. The supermarket customer removes a bottle from the shelf, places it in a shopping cart and wheels the cart away. The bottle then explodes, injuring the customer. If there has been a sale, the customer is in privity with the supermarket and has a claim for breach of warranty. If there is no sale, there is no warranty. Traditionally, the courts have ruled there is no sale until the customer checks out.n3

Of late, some cases have held that a supermarket display constitutes an offer which is accepted by the customer's act of placing the goods in his or her shopping basket, subject to the customer's power to terminate the contract before going through the check-out counter.n4 Once again, these are bursting bottle cases. Developments in products liability that allow an action against the bottler without privity and without proof of fault will eventually cause these decisions to be regarded largely as historical markers on the road to a modern system of products liability.n5 But, even in products liability cases, the claimant may prefer a contractual warranty action against the retailer for several reasons. The retailer may have greater resources than the manufacturer with which to satisfy a judgment. In addition, the retailer may be more readily subjected to the jurisdiction of the court that is the most convenient for the plaintiff. Also, the passage of time may have barred a tort claim against the manufacturer, but not a contract claim against the retailer.

The reasonable customer has reason to believe that the supermarket merchant is offering goods for sale, subject to reasonable quantity limitations, and subject to the merchant's ability to rectify any mistake made by a stock clerk in marking the price on the product. This reasonable belief is enacted in consumer protection legislation and should enter the general law of contracts. However, there are objections to this point of view. It has been noticed that supermarket customers remove goods from the shelves, place them in their market baskets, change their minds and return the goods to their original location or even to other locations. This custom would indicate that the reasonable expectations of customers is that no contract is formed until the goods are checked-out. Professor Murray has developed an intellectually satisfying theory under which supermarket customers'expectations of being able to purchase goods at advertised prices can be squared with their expectations of being able to change their minds after selecting goods from the shelves.n6 The self-service store can be regarded as having created the reasonable expectation that its offer of goods at a particular price is irrevocable. The customer has the irrevocable power to create a contract at the check-out. The customer's decision to purchase, or not to purchase, is subject to change at or before that time.

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For related research and practice materials, see the following legal topics:

Contracts LawSales of GoodsGeneral OverviewContracts LawFormationOffersGeneral OverviewContracts LawFormationOffersIrrevocable Offers

FOOTNOTES:

(n1)Footnote 1. Former § 28 ''Catalogs and Circulars'', has been consolidated with § 2.4 above.

(n2)Footnote 2. Pharmaceutical Society of Great Britain v. Boots, (1953) 1 Q.B.D. 401, affirming (1952) 2 Q.B. 795 . The case is commented on in 16 Modern L.Rev. 369 (1953). See also, Fisher v. Bell, (1960) 3 All.E.R. 731, where the defendant displayed a knife in his shop window with a price tag attached. He was prosecuted for offering a ''flick knife'' for sale in violation of a statute. It was held the display was not an offer. See further, Groomes v. United States, 155 A.2d 73 (App.D.C.1959) , a shop-lifting case.

(n3)Footnote 3. Lasky v. Economy Grocery Stores, 319 Mass. 224, 65 N.E.2d 305 (1946) ; Day v. Grand Union Co., 280 App.Div. 253, 113 N.Y.S.2d 436 (1952) , aff'd, 304 N.Y. 821, 109 N.E.2d 609 (1952) ; Loch v. Confair, 361 Pa. 158, 63 A.2d 24 (1949) .

(n4)Footnote 4. Giant Food, Inc. v. Washington Coca-Cola Bottling Co., Inc., 273 Md. 592, 332 A.2d 1 (1975) ; Gillespie v. Great A. & P. Tea Co., 14 N.C. App. 1, 187 S.E.2d 441 (1972) .

(n5)Footnote 5. See Restatement (Second) of Torts § 402A.

(n6)Footnote 6. John Murray, Contracts § 36C (3d ed. 1990).