QuantumLeap Tech, a startup, displays a highly specialized server rack on its website with a price tag of £500. Due to a coding error, the price should have been £5,000. A customer, DataHost Ltd, places an order for the server rack at £500. Which of the following statements accurately describes the legal position?

Answer options:

The website display is a binding offer which DataHost Ltd has accepted, forming a contract.

The website display is an invitation to treat; DataHost Ltd has made an offer which QuantumLeap Tech can reject.

A contract is formed, but it is voidable due to unilateral mistake.

The website display is a unilateral offer to the world, accepted by the act of ordering.

How to approach this question

Apply the legal distinction between an offer and an invitation to treat in the context of online retail.

Full Answer

B.The website display is an invitation to treat; DataHost Ltd has made an offer which QuantumLeap Tech can reject.✓ Correct

In contract law, displaying goods on a website is generally considered an invitation to treat, not an offer. When the customer places an order, they are making the offer. The seller (QuantumLeap Tech) can choose whether to accept or reject this offer, protecting them from pricing errors.

Common mistakes

Assuming that a price tag or website listing constitutes a legally binding offer.

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