Placing an advertisement on the Internet is essentially advertising or holding out to the world at large. 327. The law of agency and that pertaining to the formation of contracts are expressly recognised in s13(8) of the ETA as continuing to apply to electronic transactions. Daniel was previously a partner and head of the technology practice at Messrs Rajah & Tann. The recipients of this e-mail included the second, fourth, fifth plaintiffs and Tan Cheng Peng, the third plaintiffs girlfriend. [2005] 1 SLR(R) 0502 Chwee Kin Keong and others v Digilandmall.com Pte 25 The mass e-mail at 2.58am is cursorily dismissed by counsel for the plaintiffs as poor use of language that ought not to be taken literally in light of the early hours of the morning. Certainty in commercial transactions should not be trifled with, as this will inevitably affect how commercial and business exchanges are respected and effected. There are two types of orders relevant: market orders and limit orders. 53 He claimed that seeing the same price on the Digilandmall website confirmed his view that there had been no mistake. 80 Upon the conclusion of submissions, I directed counsel to appear before me. Chwee Kin Keong and Others v Pte Ltd PDF fileChwee Kin Web merchants ought to ensure that they either contract out of the receipt rule or expressly insert salient terms within the contract to deal with issues such as a choice of law, jurisdiction and other essential terms relating to the passing of risk and payment. Given its global reach and ever changing technological advancements, Internet usage will pose a myriad of issues for resolution. In addition, each of the confirmatory e-mail responses states at the outset: [W]e will be calling you in the near future to deliver the products to the address shown below. 118 The Canadian courts have been the most active common law courts explicating and developing this area of the law. The essence of snapping up lies in taking advantage of a known or perceived error in circumstances which ineluctably suggest knowledge of the error. She opined that situations where unilateral mistake had been considered were those involving fraud or a very high degree of misconduct. Rajah J.C. in the Singapore High Court in Chwee Kin Keong v. Digilandmall.com Pte. This case is a paradigm example of an error on the human side. "Unilateral Mistake in Law and Equity: Solle v Butcher Reinstated" by No harm trying right? There are, however, other sound reasons to argue against such a rule in favour of the recipient rule. The contract stands according to the natural meaning of the words used. 4, 1971, p. 331. As a lawyer, he appears to have been indispensable in the plaintiffs attempts to hold the defendant to the bargain. The rigour in limiting this scope is also critical to protect innocent third party rights that may have been acquired directly or indirectly. [2005] 1 SLR (R) Chwee Kin Keong v Digilandmall.com Pte Ltd 507 printers. It is germane to observe that none of the cases purporting to follow Solle v Butcher [1950] 1 KB 671 have with any degree of clarity defined the parameters of equitable mistake in contradistinction to a common law mistake. He too affirmed from his searches that the normal price of the laser printer was in the region of US$2,000. We are only concerned with the question whether relief might be given for common mistake in circumstances wider than those stipulated in Bell v Lever Bros Ltd [1932] AC 161. The essence of unilateral mistake is the knowledge or deemed knowledge of a mistake and though fraud may often be present it is not an essential ingredient. Two issues had arisen. HIGH COURT. , In unilateral mistake, only one of the parties is mistaken. The payment mode opted for was cash on delivery. Homestead Assets Sdn Bhd v. Contramec . (c) the need to reach commercially sensible solutions while respecting traditional principles applicable to instances of genuine error or mistake. Needless to say, this goes to the very heart of the claims sustainability. Despite the general views expressed in Taylor v Johnson (1983) 151CLR 422 on equitable mistake, it seems to be generally accepted in Australia as well, that this class of cases requires special mention and consideration. In the High Court, the learned judge ("the Judge") decided, in the main, in favour of the Purchaser. This contention is wholly untenable. This can be supported by the decision of the High Court of Singapore in the case of Chwee Kin Keong v. Digilandmall.com Pte Ltd, in which Judicial Commissioner Rajah argued that "the party who selects the means of communication should bear the consequences of any unexpected events" . For example, in the Singapore High Court decision of Chwee Kin Keong v Digilandmall.com Pte Ltd [2004] 2 SLR 594 ("Digilandmall"), affirmed on appeal in Chwee Kin Keong v Digilandmall.com Pte Ltd [2005] 1 SLR 502 without considering this particular issue, V K Rajah JC (as he then was) observed, as follows (at [139]): Interestingly, Desmond also remarked to the first plaintiff that he wasnt greedy before I tok to u. 156 The plaintiffs claims are dismissed. This is in contrast to the English position where after several decades Hartog v Colin & Shields still remains the locus classicus. While commercial entities ought not to be given a licence to relax their vigilance, the policy considerations in refusing to enforce mistaken agreements militate against attaching undue weight to the carelessness involved in spawning the mistake. 107 As the law now stands, mistakes that are not fundamental or which do not relate to an essential term do not vitiate consent. Normally, however, the task involves no more than an objective analysis of the words used by the parties. As most web merchants have automated software responses, they need to ensure that such automated responses correctly reflect their intentions from an objective perspective. In the context of the present proceedings, the extra-judicial observations of Lord Steyn in Contract Law: Fulfilling the Reasonable Expectations of Honest Men (1997) 113LQR 433 at 433 are particularly apposite: A thread runs through our contract law that effect must be given to reasonable expectations of honest men. From time to time they communicate with each other, 4 The defendant is a company that sells information technology (IT) related products over the Internet to consumers. The defendant, Digilandmall.com Pte Ltd, were an online IT company that sold related software and hardware from Singapore. Altogether he sought to purchase 760 units, the largest number of orders placed by anyone between 8 and 13January 2003. It has been a fertile source of academic debate, but in practice it has given rise to a handful of cases that have merely emphasised the confusion of this area of our jurisprudence. 55 The fourth plaintiff is technologically savvy and runs an Internet business with the second plaintiff. However, not all principles will or can apply in the same manner that they apply to traditional paper-based and oral contracts. After placing his second order, he admitted making further searches on the Internet to fortify my view that the price of the $66 per printer was not a mistake He was also the only plaintiff who placed an order on the Digilandmall website. 3. The law may not imply a condition precedent as to the availability of stock simply to bail out an Internet merchant from a bad bargain, a fortiori in the sale of information and probably services, as the same constraints as to availability and supply may not usually apply to such sales. He was opportunistic in effecting his purchases, active in co-ordinating with the other plaintiffs on the eventful morning, and economical with the truth in his evidence. 17 Having called the second and third plaintiffs at about 2.00am, the first plaintiff also sent them, via e-mail, a weblink of the relevant HP website pages. It would be fair to say that such a person should not have any legitimate expectation that the contract in question will be either respected or sanctioned by court. It is not necessary to prove actual knowledge on the part of the non-mistaken party in order to ground relief, as in this context one is taken to have known what would have been obvious to a reasonable person in the light of the surrounding circumstances: Hartog v Colin and Shields [1939] AllER 566 (KBD); McMaster University; Stepps Investments, supra; Taylor, supra. This is approved in a Singaporean case, Chwee Kin Keong v Digilandmall.com Pte Ltd . The amounts ordered and the hurried and hasty manner in which the orders were executed are of cardinal importance. 54 The fourth plaintiff admits that he had entertained the idea at the material time that the price posting could have been an error. The transcript states that the third and the fifth plaintiffs saw a great opportunity and grabbed it. The reach of and potential response(s) to such an advertisement are however radically different. We can understand why the decision in Bell v Lever Bros Ltd did not find favour with Lord DenningMR. An equitable jurisdiction to grant rescission on terms where a common fundamental mistake has induced a contract gives greater flexibility than a doctrine of common law which holds the contract void in such circumstances. The elements of an offer and acceptance are ex facie satisfied in every transaction asserted in the plaintiffs claims. It is axiomatic that normal contractual principles apply but the contractual permutations will obviously be sometimes more complex and spread over a greater magnitude of transactions. There are in this connection two schools of thought. The plaintiffs refute that the error exonerates the defendant; they insist that a concluded contract is sacrosanct and must be honoured. At 4.15am, he sent an email to the first plaintiff, copied to the second plaintiff, with a happy emoticon following check out the prices here (see [19]. Having pointed out 6 that a court 'will generally be cautious if not reluctant to effect any amendments once the hearing has commenced; even more so once the evidential phase of the . It is unequivocally unethical conduct tantamount to sharp practice. 94 Historically, the common law has recognised an anomaly in the contractual features pertaining to a display of goods for sale. 74 Under product description on each webpage, instead of the actual description of the laser printer which in this case should have been HP9660A Color LaserJet 4600, only the numerals 55 appeared: this was the result of Samuel Teos earlier inadvertent input. 28 In any event, the first plaintiffs commercial background and business experience alone would have amply alerted him to the likelihood of the pricing being a mistake, even without his conversation with Desmond. [The Myth of Mistake in the English Law of Contract (1954) 70LQR 385 at 396]. Delivery was merely a timing issue. He is also part of the Bel-Air network. The defendants wanted to sell some hare skins to the plaintiffs. The contract was held to be void because there was no consensus on the terms. Scorpio: 13/01/20 01:43 yeah man whats the original price? Chwee Kin Keong and others v. Digilandmall.com Pte Ltd. [2004] SGHC 71. Unlike instances of fraud, where it is said fraud unravels the existing contract, in instances of unilateral mistake, the very existence of the contract is negatived there is no consensus. The complainants had ordered over 100 printers each at this price. Put another way, that decision seems to indicate that the effect of a unilateral mistake is only to render a contract unenforceable rather than void. The following excerpts are particularly relevant: Desmond: 13/01/20 01:17 go hp online now. He graduated from NTU as a bachelor of business studies, specialising in financial analysis. Slade, in a well reasoned article written not long after, 128 The most significant judicial pronouncement supporting this view emanates from the recent English Court of Appeal in, Thus the premise of the equitys intrusion into the effects of the common law is that the common law rule in question is seen in the particular case to work injustice, and for some reason the common law cannot cure itself. In a physical sale, the merchant can immediately turn down an offer to purchase a product that has been advertised; otherwise he may be inundated with offers he cannot justify. 47 Not content with making his own purchases, he woke up his brother and transacted 330 units on his behalf. If the defendant were right, they maintain, uncertainty would prevail in the commercial world and more particularly in Internet transactions. 112 Phang ([106] supra, at 418) rightly observes: It must be stressed that, in this context, a man is taken to have known what would have been obvious to a reasonable person in the light of the surrounding circumstances. I would not however invariably equate the required conduct with fraud. VKR a j a hJ C. 27-30 January; 2-6, 9 February; 13 March; 12 April 2004. The court found that parties when . A prospective purchaser is entitled to rely on the terms of the web advertisement. His revelation that he did not know if this is an error or whether HP will honour this purchase, not to mention the articulation of his hope that by the time you see this email, the price is still at S$66.00 coz they might change it anytime, are all compelling in reflecting his state of mind and awareness that an error had occurred. Though both of them admit to having had discussions about the website terms and conditions governing the purchases, they deny that there was any discussion between them on even the possibility of an error having taken place. 93 Website advertisement is in principle no different from a billboard outside a shop or an advertisement in a newspaper or periodical. While they did not invariably admit that their searches were made prior to each of the respective transactions, it was plain that they did not tell the whole truth about what they knew, how they knew it and when they knew it. At the very least, it has been forcefully asserted that even when a mistake does not result in voiding a contract through the application of common law principles, there remains an independent doctrine of mistake founded in equity which justifies judicial intervention. 14 The first, second and fourth plaintiffs became acquainted with each other when they studied at the Nanyang Technological University (NTU). In Chwee Kin Keong v. Digilandmall.com Pte Ltd, one of the defendant's employees mistakenly uploaded the contents of a training template onto the defendant's website, resulting in the retail price of S$3,854 for a commercial laser printer on the website being replaced with the figure S$66. He appeared distinctly uncomfortable during several phases of his cross-examination and his answers on crucial points were evasive and often vague.. His evidence in relation to the level and nature of communications he had with the second and third plaintiffs on the morning in question lacked candour. While a court of law does not sit as a court of commercial morality, it cannot lose sight of this central objective of contract law. He placed another order for a further 150 printers at 3.14am, followed by two further orders for 300 printers each at about 3.56am and 3.59am. Case Update: B2C2 Ltd v Quoine Pte Ltd [2019] SGHC(I) 3; Quoine v B2C2 They proceeded to file their amendments to the statement of claim as if leave had already been given. He is described by his counsel in submissions as a prudent and careful person. Desmond: 13/01/20 01:47 u make me greedy, Scorpio: 13/01/20 01:47 ok lor if you insist . He classifies mistake in the following manner at 386: If attention is fixed merely on the factual situations, there are three possible types of mistake: common, mutual and unilateral. Most telling of all, I note that the first to fifth plaintiffs exhibited identical reports in each of their affidavits without any qualification whatsoever. It is simply inconceivable that when he entered into the purchase transaction, he did not know, or at the very least did not have a real and abiding belief that the price posting was an error. "Unilateral Mistake in Contract: Five Degrees of Fusion of Common Law a Added to his own purchases of 760 units, he was effectively responsible for the purchase of 1,090 laser printers. He confirmed through these searches that the usual price of the laser printers was in the region of US$2,000. Chwee Kin Keong v Digilandmall.com Pte Ltd [2005] 1 SLR 502: [2005] SGCA 2 Context: This Case deals with the issue of unilateral mistake. After all, what would he do with 100 obsolete commercial laser printers? 111 In Chwee Kin Keong v Digilandmall.com Pte Ltd [2005] 1 SLR(R) 502 ("Chwee Kin Keong"), this court said at [101]: Under O 20 r 5(1) of the Rules of Court (Cap 322, R 5, 2004 Rev Ed), the court may grant leave to amend a pleading at any stage of the proceedings. I have found that the plaintiffs had at all material times knowledge of or, at the very least, a real belief that an error had been made by the defendant in the price posting. There is no question, however, that he placed the orders, that these orders were received by the HP website and that the same automated response sent to the other plaintiffs was sent out to him. Mistakes that negative consent do not inexorably result in contracts being declared void. Cases of fraud and misrepresentation, and undue influence, are all catered for under other existing and uncontentious equitable rules. When, however, the cases provoked by these factual situations are analysed, they will be seen to fall, not into three, but only two distinct legal categories. 121 While my views here are not central to my decision, the plaintiffs have adverted to this relationship in a misguided attempt to derail the defence on an arid pleading technicality. The answer on the authorities is a mistake by one party of which the other knew or ought reasonably to have known. Desmond intimated that the defendant would give vouchers or special deals as a matter of equitable compensation should it not honour the purchase orders. be rebutted" (per Salmon LJ in Jones v. Padavatton (1969)). CHWEE KIN KEONG and Others v DIGILANDMALL.COM Pte Ltd (2004) 2 SLR 594. Please refer to the PDF copy for a print-friendly version. There is no doubt that the plaintiffs acted with indecent haste in the dead of the night in placing as many orders as each of them felt their financial resources credibly permitted them to do. The e-mails had all the characteristics of an unequivocal acceptance. The defendant, on the other hand, contends that the law should not penalise a party who has unwittingly and genuinely made a unilateral mistake which was known or ought to have been known by the plaintiffs. Having noted all this, I am nevertheless inclined towards the views expressed in the, 131 In a number of cases, including the present, it may not really matter which view is preferred. The Postal Acceptance Rule in the Digital Age - ResearchGate This judgment text has undergone conversion so that it is mobile and web-friendly. 21 The first plaintiff must have realised at the outset that he would have to explain with a certain measure of credibility the purport and significance of all his Internet communications between 1.00am and 3.00am on 13January 2003. Keywords Contract Online Store Mistake Pricing Mistake Citation 141 In so far as the sixth plaintiff is concerned, I emphasise that his knowledge and/or conduct of should be equated with that of the third plaintiff. He holds an accounting degree from NTU. The second, third, fourth and sixth plaintiffs are the only individuals who ordered more than a hundred laser printers each. I invited both parties to indicate if they wished to amend their pleadings. 136 First, it was suggested that no contracts had been formed as all the contracts were subject to availability and that a failure to adhere to the directive call to enquire prevented the contracts from coming into existence. CHWEE KIN KEONG v DIGILANDMALL.COM Pte Ltd (2005) SGCA 2. Take a look at some weird laws from around the world! Administration law is the actions made by a government, which adversely affects an individual. Loose language may result in inadvertently establishing contractual liability to a much wider range of purchasers than resources permit. Clout issue 43. I reject this. In short, where does the justice reside? The first, second and third plaintiffs have been friends for a long time and are bound by common business interests. One is hard put to imagine that anyone would purchase such an item, let alone place very substantial orders, without making some very basic enquiries as to pricing. It is plain that the defendant had given careful consideration to this issue and was prepared to contract on the basis that it would be able to comply with any orders hence, there was no reference to any order being subject to stock availability. Hwa Lai Heng Ricky v DBS Bank Ltd and another appeal and another Limit orders: order to be executed only when the desired price is available. After establishing from the web pages that the price quoted for the laser printer was indeed $66, he proceeded to make searches through search engines like Yahoo and visited the website of Hardware.com. 76 On Monday, 13January 2003, at about 9.15am, an employee of the defendant received a call from a prospective customer inquiring whether the defendant was aware of the posted price of $66 for the laser printers on the HP website. Sometimes this is made explicit by judges; more often it is the implied basis of the courts decision. This constituted more than a quarter of the total number of laser printers ordered. Leave was also given to the plaintiffs to adduce further evidence, if they so desired. In a physical sale, the merchant can immediately turn down an offer to purchase a product that has been advertised; otherwise he may be inundated with offers he cannot justify. *You can also browse our support articles here >. There are many different shades of sharp practice or impropriety. From time to time there will be cases where this is an overriding consideration. The element of constructive knowledge based upon what a reasonable person ought to know is premised upon that person not being conscious of the error. The terms of the offer are clear and unambiguous and the offeree accepts the offer according to its true sense, but it must have been obvious (and known by the offeree) that the offeror did not intend to make an offer in those terms. In these circumstances we can see no option but so to hold. In this case we have heard full argument, which has provided what we believe has been the first opportunity in this court for a full and mature consideration of the relation between Bell v Lever Bros Ltd [1932] AC 161 and Solle v Butcher. Normally the contract is only concluded when the acceptance is communicated by the offeree to the offeror. Our conclusion is that it is impossible to reconcile Solle v Butcher with Bell v Lever Bros Ltd. He then zealously sent at about 2.58am, an e-mail to 54 persons, all of whom were friends and/or business associates. The quintessential approach of the law is to preserve rather than to undermine contracts. The plaintiffs attempted to take advantage of the defendants mistake over the Internet. As a lawyer, he appears to have been indispensable in the plaintiffs attempts to hold the defendant to the bargain. Court Determines if There's a Contract Existence - LawTeacher.net High Court Suit No 202 of 2003. PDF Blips And Blunders: The Law Concerning Mistakes Made In Electronic C {Q V Document Citado por Relacionados. 114 For good measure, I should allude that the plaintiffs in their written submissions concede that in order to establish that mistake is operative at common law, the defendant has to show in this instant case that the plaintiffs each had actual or constructive knowledge of the mistaken pricing.