ACCA · Question 46 · Syllabus B: The law of obligations
Scenario: QuantumLeap AI Ltd, a tech startup, advertised a new software tool on their website for £50 (a pricing error, should be £500). Zephyr Corp ordered 10 copies. QuantumLeap realized the error and refused to supply. Later, QuantumLeap contracted with DataForge to build a server by 1 May. DataForge finished on 1 June, causing QuantumLeap to lose a lucrative government contract they hadn't told DataForge about.
Regarding the website advertisement for £50, what is the legal position of QuantumLeap AI Ltd?
Answer options:
The advertisement is a binding offer, and Zephyr Corp's order is an acceptance, forming a contract.
The advertisement is an invitation to treat; Zephyr Corp made an offer which QuantumLeap is free to reject.
The advertisement is a unilateral contract, binding QuantumLeap to supply the software.
The pricing error automatically voids any contract under the doctrine of mistake.
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