An invitation to treat is an action inviting other parties to make an offer to form a contract. These actions may sometimes appear to be offers, and the difference can sometimes be difficult to determine. The distinction is important because accepting an offer creates a binding contract while "accepting" an invitation to treat is actually making an offer.
Advertisements are usually invitations to treat, which allows sellers to refuse to sell products at prices mistakenly marked. Advertisements can also be considered offers in some specific cases. Auctions are sometimes invitations to treat which allows the seller to accept bids and choose which to accept. However, if the seller states that there is no reserve price or the reserve price has been met, the auction will be considered an offer accepted by the highest bidder.
An invitation to treat is to be distinguished from an offer as it merely indicates a willingness to deal but does not display an intention to be bound. Broadly speaking, an invitation to treat is an action by one party which may appear to be a contractual offer but which is actually inviting others to make an offer whilst an offer is an expression of willingness to contract on certain terms, made with the intention that it shall become binding as soon as it is accepted by the person to whom it is addressed, the “offeree”.
The indication of willingness to enter into a contract may manifest itself in a variety of ways. The indication can be contained in a letter, a newspaper, a faxed document, an e-mail or it may even be inferred from someone’s behavior.
An offer is something which must be done or refrained from being done which is accepted to become a contract. For example, you offer your car for sale for a price say for $9,000.00, your offer to the world at large is GHC 9,000.00 consideration for your car. Your term is simply if you give me GHC 9,000.00 you can have my car.
An invitation to treat simply means an invitation to...