Mrs Smoke read an advertisement in a magazine about a new health product (Carlill's Cough Ointment) that claimed to 'cure any type of cough within two weeks'.The instructions stated that 'users should apply the ointment three times daily to the throat region', and 'within two weeks the cough will completely disappear'.The advert also claimed it would fully refund the cost of the medicine as well as pay $500 to anyone who followed the instructions and continued to have a cough after a two-week period.The advert also stated that the company had deposited $10,000 with its bank, 'showing sincerity in the matter'.

Mrs Smoke took the ointment three times daily for two weeks as per the instructions but continued to have a severe raspy cough. When she approached the Carlill Cough company to claim a refund and the $500, they refused to give her the money, claiming their advert was a mere puff and an invitation to treat, not an offer.

Advise Mrs Smoke.

Question One.

Which of the following statements accurately state the legal ISSUE/S in the case above?

Question 1 options:

The broad legal issue is whether the medicine was too expensive given it did not work properly.

The broad legal issue is whether the contract was breached between Mrs Smoke and Carlill Cough because the offer was not accepted by Mrs Smoke.

The broad legal issue is whether there was a contract formed between Mrs Smoke and Carlill Cough company.

The specific legal issue is whether the reward formed the basis of a contractual promise because the company believed in its medicine.

The specific legal issue is whether the advert was a counter-offer, which is capable of acceptance by Mrs Smoke, simply by her following the instructions.

The specific legal issue is whether the advert was an offer to the world, capable of acceptance by Mrs Smoke, simply by her following the instruction.

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