Online pricing blunders are causing problems for etailers.
Thai Airways is the latest etailer to back track on a customer’s
order following incorrect pricing on its website. Thai Airways
advertised first class flights from London to Bangkok on its website
for the price of the flight tax. Customers taking advantage of this
incredible offer were sent email confirmation of their reservations
but this was followed by a second email informing them that Thai
Airways would be unable to issue the tickets due to the
“unfortunate but obvious” mistake in online pricing.
Thai Air’s ticketing terms and conditions on its website do not
actually allow customers to buy electronic tickets for flights from
London to Bangkok and instead it refers to customers being able to
make reservations which are then subject to a ticket being issued.
Unless it could be argued that a customer’s attention had not been
sufficiently drawn to the terms and conditions or the order
acknowledgement initially received by customers contradicted the
terms and conditions then there does not appear to be a legal
requirement for Thai Air to fulfil the orders.
In March 2003, it was Amazon.co.uk who disappointed customers hoping
to take advantage of its offer to sell Hewlett Packard Pocket PCs for
a mere Â£7.32. Customers who believed that they had successfully had
their online order accepted were referred by Amazon to its Conditions
of Use which stated that no contract is formed between the customer
and Amazon until the customer receives an email from Amazon stating
that the item has been dispatched. Confusion for customers lay in
the fact that they had received an email confirming their order which
included an anticipated date of delivery and a section on how to
cancel “the contract” which to most customers suggested
that their offer to purchase the PCs had been accepted by Amazon and
a contract had in fact been formed.
There is also doubt as to whether the Conditions of Use which Amazon
relied upon to avoid fulfilling the orders in this case were ever
actually incorporated into the contract because a customer could have
placed an order without being forced to click on the Conditions of
Use which are accessed from a separate link.
However, if an etailer’s terms and conditions fail to protect it in
the event of a pricing error they may be able to rely on the
equitable doctrine of mistake, which could operate where the etailer
does not indicate that the unusually low price is part of a
promotional offer and the buyer is likely to be aware that the
pricing is incorrect. As a result, any contract entered into by the
parties is unlikely to be legally enforceable.
It is worth noting that etailers have a statutory duty under the
Electronic Commerce Regulations to provide the technical steps
required to conclude a contract online in a clear, comprehensible and
unambiguous manner and also any reference to pricing should be clear
It seems unlikely that a court will get to decide on this confusing
issue at the moment with most customers reluctantly accepting the
etailers’ refusal to fulfil orders although for etailers there is
still the cost of bad publicity and the loss of customer trust and
satisfaction to take into account.