Court Case: Carlill v. Carbolic Smoke Ball Company (1892)

In 1892, the Carbolic Smoke Ball Company made a product called the "smoke ball," which claimed to be a cure for the flu and a number of other diseases if inhaled 3 times daily. The Company published advertisements claiming that it would pay $100 to anyone who got sick with the flu after using its product according to the instructions set out in the advertisement.

$100 reward will be paid by the Carbolic Smoke Ball Company to any person who contracts the increasing epidemic influenza colds, or any disease caused by taking cold, after having used the ball three times daily for two weeks, according to the printed directions supplied with each ball. $1000 is deposited with the Alliance Bank, Regent Street, showing our sincerity in the matter.

Elizabeth Carlill saw the advertisement, bought one of the balls and used it three times daily for nearly two months until she contracted the flu on January 17, 1892. She tried to claim the $100 from the Carbolic Smoke Ball Company, but the company ignored her. They also ignored two letters from her husband, a solicitor.

Elizabeth Carlill ultimately filed a lawsuit for the money advertised and brought a claim to court. The attorneys representing her argued that the advertisement and her reliance on it was a contract between her and the company, and so they ought to pay. The company argued it was not a serious contract (but rather a sales pitch or sales puff) and was thus unenforceable they said you cannot make a contract with the world.

Watch the link for more info on this case: https://www.youtube.com/watch?v=vzHKe76Vylo (youtube video Carlill v. Carbolic Smoke Ball Company - Contract Law Cases - 2:31)

Discuss:

1. Was the advertisement a formal or informal contract, and why? 2. Was the advertisement a bilateral or unilateral contract, and why? 3. Why did the company argue it should not have to pay up? 4. What did the court decide regarding whether or not the advertisement was a valid offer? 5. Did Elizabeth Carlill ultimately receive her $100 by order of the court? 6. What advice would you give to Carbolic Smoke Ball Company after reading this?

*Be sure to respond with at least 150 words.