NCA Contracts Practice Questions - NCA Canadian Contract Law Examination Exam

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A company advertises a smoke ball, promising to pay £100 to anyone who uses it as directed and still catches influenza, and states it has deposited funds in a bank to show its sincerity. A purchaser uses the ball as directed and catches influenza. The company argues there was no contract because the advertisement was a mere puff and no acceptance was communicated. Which analysis is correct?

The advertisement was an invitation to treat, so the purchaser made the only offer The advertisement was a unilateral offer accepted by performance, and notification of acceptance was not required No contract formed because the purchaser never communicated acceptance before performing The deposit of funds was irrelevant and the promise was an unenforceable gratuitous statement

Correct Answer:

The advertisement was a unilateral offer accepted by performance, and notification of acceptance was not required

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