Online ShoppingThis article is provided for informational purposes only and does not constitute legal advice.

BY FRANCESCA FERRANDO

(Francesca is currently in traineeship with David Zahra & Associates Advocates. She is currently reading law at the University of Malta and her main interests are corporate and commercial law, with a special interest in consumer law).

A recent decision of the Consumer Claims Tribunal should be of interest to vendors who operate a website with online shopping capabilities.

The complaint concerned the incorrect pricing of a product advertised on the respondent company’s website.

The facts of the case Peter Gatt vs Brandon Theuma – Krea (Malta) Limited were as follows: the plaintiff ordered a piece of furniture which was priced at €85, which seemed to be a great bargain to the purchaser. However consequently, the purchaser was contacted by the vendor and informed that there had been a mistake with the pricing of the product in question – the piece of furniture actually cost €349!

Upon being made aware of this fact the plaintiff maintained that once the said price was advertised he should therefore be entitled to complete the purchase at the set price.  The plaintiff also refused the defendant’s offer of purchasing the item at half the truthful price being that of €174.50 as opposed to €349.

The tribunal noted that this was a genuine mistake on the vendor’s part and therefore upheld the vendor’s request, that is, for the plaintiff to purchase the item at the discounted price of €174.50.

Whilst the Tribunal did not actually delve into the principles of contract law, within the Maltese legal system, if the consent given by either party was vitiated by error (i.e. they were agreeing to a different price for the piece of furniture in question than that which was displayed on the website), the contract will either be classified as null ab initio or annullable. Without due consent by both parties, there is no binding contract.

The tribunal nonetheless still took into consideration the fact that the client did not receive the legitimately expected service from the company, as the price advertised on the website was ultimately incorrect. Such an error was what led the plaintiff to complete the order.

Therefore on the basis of Article 21(2) of the Consumer Affairs Act (Cap 378, Laws of Malta), which allows the tribunal to order the trader to pay the consumer an amount of not less than €35 and not more than €233 as moral damages for any pain distress, anxiety and inconvenience, the Tribunal awarded moral damages to the plaintiff for the inconvenience and anxiety caused by such error on the price.

Website administrators with online shopping capabilities should therefore take note of such a decision and take the adequate steps and exhibit the correct attention in order to prevent such an event taking place.  It would also be wise to include a clause within the Terms & Conditions on the website exempting liability for any errors in price and if such an error is found the consumer will be immediately informed of such a change.  Such a clause would also be applicable for other errors, such as those relating to specifications, colours, measurements and other qualities of the products.

Click here to read the full decision of the Consumer Claims Tribunal.