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Occasionally a website will post incorrect prices for items they are selling. (Maybe it was caused by a typo during their data entry process, or the result of a bug in their code.) Once they realize their error they correct it.

If I notice the error before they do, and I attempt to buy the item before they fix it, is that legal? I.e., if I knowingly try to exploit their mistake could I be violating any law?

Now, if I continually monitor websites, waiting for such an error, just so I can buy at erroneously low prices, does that pose any further legal issues?

I'm not hacking or changing their prices. I'm just waiting to buy until an incorrect price is mistakenly posted.

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    I suppose it doesn't apply to online stores, but in New York City, if an item is offered for sale in a store and has been incorrectly labeled with a low price, the retailer must honor the price.
    – phoog
    Commented Jul 21, 2015 at 15:54

2 Answers 2

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There may be violations of consumer protection and/or advertising statutes here by the online store, but the common law position is that:

  1. The website's owner is making an invitation to treat
  2. Based on that, you are making an offer
  3. The contract comes into place when the website's owner accepts your offer.
  4. The time of contract formation is "when the parties give objective manifestation of an intent to form the contract."

You would need to read the site very carefully, in particular their terms and conditions, acknowledgement page and/or email to see if they are actually accepting your offer or if there are conditions attached. If there is no clear, unconditional acceptance then there is no contract at that time; this applies even if you have paid for the goods.

If this is the case (and I strongly suspect that it would be for most online stores), then their acceptance of your offer and the formation of the contract probably does not come into effect until they "give objective manifestation of an intent to form the contract" by shipping the goods. Up until that time there is no contract and their only obligation to you is to promptly refund your money.

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    Of course, the common law position may be inapplicable if there are consumer protections in place analogous to the New York City rule described in a comment to the question. That is, the published price may be construed as an offer, or otherwise be held as binding on the merchant.
    – phoog
    Commented Jul 21, 2015 at 15:57
  • @phoog hence my opening sentence
    – Dale M ♦
    Commented Jul 21, 2015 at 20:46
  • lol. I added the comment because I thought the opening sentence didn't give enough weight to the consumer protection aspect. It reminds me of a time when my sister, fresh out of college, responded to a telephone giveaway scam, and when she sought advice from our father (trained lawyer but not practicing) he told her she was liable for the money they had charged because she had agreed to a contract. I found that the consumer protection laws in Georgia had sections aimed specifically at such scams, and in the end, she got the money back by complaining to her credit card issuer.
    – phoog
    Commented Jul 22, 2015 at 8:06
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    i've been thinking about this a bit over the last day or so, and it has become obvious why consumer protections are needed: if an advertisement or a price label is merely an invitation to treat, then there is nothing prohibiting the bait and switch. This is somewhat less important in online commerce, I suppose. I've looked around a bit for similar laws governing prices in online commerce, but I haven't found anything.
    – phoog
    Commented Jul 22, 2015 at 8:10
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It may or may not be a crime (I will come back to this tomorrow, but I strongly doubt it because there is no deception on your part), but there is another thing at play: if they discover the error before shipping the good, they may well be able to refund you and deny the purchase. A unilateral mistake will often result in a voidable contract if the other party knew of the mistake and intentionally exploited it. (source)

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  • New York City customer protections don't work this way; a merchant can't get out of mislabeling something by arguing that the consumer knew it was a mistake. Of course, that law is no doubt inapplicable here, but there may be similar protections in place.
    – phoog
    Commented Jul 21, 2015 at 16:01
  • You mean in NYC, if you go to a store and pay for something but they notice the price tag is wrong before they deliver it, they can't cancel the sale? Do you have a source? Note that I'm only talking about before it ships, not them trying to get you to send back the item after you get it (or pay them the difference).
    – cpast
    Commented Jul 21, 2015 at 16:07
  • Actually, they have to give you the lower price even if they discover the error before you pay. I got a cable modem this way once, at the price of the next-cheaper model, because the merchandise was out on a shelf with the wrong tag. The scanner registered the correct price, I complained, and I paid the lower price. Source in a moment.
    – phoog
    Commented Jul 21, 2015 at 16:11
  • Not what I was looking for, but see stamfordadvocate.com/news/article/…
    – phoog
    Commented Jul 21, 2015 at 16:15
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    See item 3: prices must be posted, and it is illegal to charge more than the posted price: www1.nyc.gov/site/dca/consumers/10-things-consumer.page
    – phoog
    Commented Jul 21, 2015 at 16:28

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