Sears Makes a Mistake

Some shoppers on Sears.com thought it was their lucky day when they saw expensive play sets and fancy toys available for the low price of $11.95.  Consumerist has the story here.  If you saw a storybook cottage that typically costs hundreds of dollars listed for sale at the low, low price of $11.95, what would you think?  That’s right.  Unless it was advertised as a huge blowout sale, you would probably guess it was a mistake.  Apparently, Sears lists items sold by third parties and gets a cut – and this time, a third party had made a pricing error on its items.  Of course, some Sears sellers were upset – even though Sears refunded their money and gave them a $5 gift card.  So, for all those upset sellers, let’s run through the mistake scenario to see whether the law would be on your side:

Was this a mistake of a basic assumption?  – Yes, it was a pricing error and pricing errors are generally considered basic assumption mistakes.

Was the mistake made by one or both parties (was it a mutual or unilateral mistake?) – Here, Sears mistakenly believed that the prices listed on its website were accurate (not all $11.95) while the customers saw what the prices were – $11.95 –  so it was a unilateral mistake made by Sears. 

Did it have a material effect?  Yes, there’s a big difference between $11.95 and hundreds of dollars so Sears would make less money on the transaction.

Did the non-mistaken party (the Sears customers) know or should they have known of the mistake?  – Yes, because they should know that expensive playsets are typically not sold for such a low price unless it is part of a promotion or clearance sale.

Did the mistaken party bear the risk of the mistake?  You might think Sears would, since it is their website.  But based upon existing case law (i.e. Donovan v. RRL Corp), since there’s no lack of good faith here and Sears presumably acted reasonably in managing its website – it does not constitute “neglect of a legal duty” and Sears likely doesn’t bear the risk of the mistake.

So – there you have it.  Sorry kids – guess you’ll just have to go outside and build your own play castles with branches and old bed sheets…