The scheme: offering or exposing for sale
Offering for sale
The term “offering” for sale covers those circumstances when a seller makes a specific offer of controlled liquor to another business with the intention the offer will form a binding contract when accepted by the customer. Normally, you would expect a wholesaler to make an offer to a potential buyer in specific terms, for example Geoff offers to supply Caroline with 50 cases of wine for a set price and by a specified date. Caroline accepts the offer.
If a written contract exists between the parties, then you would expect to see a specific agreement to sell controlled liquor to the customer with clearly laid out terms and conditions. In the absence of a written contract you should consider the circumstances and the business’s role in this. What did the customer think they were getting from the business? What agreement did they come to? What were the terms of the “offer”? Did the offer include the following:
- a description of the alcohol
- a delivery date
- a date payment would be required
- a price?
An offer can be in any form as long as it contains the details in which the supplier is prepared to enter into a contract. If specific details are not present, this is more likely to be an advertisement which could fall into the definition of “exposing for sale”.
Paul opens a small, independent pub specialising in real ales. He is approached by Nick who offers him a regular supply of “Old Smoky” at a reduced price if he agrees to a six month contract. Nick is offering controlled liquor with the intention that the sale if made would be a wholesale sale. He should have already applied for approval.
Exposing for sale
A person who displays or advertises goods for sale is not caught by the term “offering for sale”. This is a long established position in contract law as advertising or displaying goods is seen as an “invitation to treat” rather than a specific offer. This is because the seller has not entered into a specific contract with the buyer until the buyer responds to the invitation by making an offer and the seller accepts it (or not). This could be as simple as picking up the alcohol and taking to the till to pay. In effect, it is a pre-offer indicating a willingness to enter into a contract.
The definition of controlled activity was therefore extended to make sure businesses that display or advertise controlled liquor for resale such as online websites, cash and carries, and so on, were included. This was mainly so these businesses could not rely on a defence against a criminal prosecution that they had never made a sale or actually entered into a contract to make a sale.
There is case law that established this principle. See Fisher v Bell and Partridge v Crittenden for further information.
So exposing for sale for AWRS purposes means:
- a business who displays controlled liquor on premises for the purpose of inviting others to buy it and the sale would be a wholesale sale or
- advertises controlled liquor with the intention that a purchaser will either buy online or make contact to buy and the sale would be a wholesale sale.
It is not necessary for anyone actually to buy the alcohol for it to be considered as being offered or exposed for sale.
Amy is a wholesaler selling alcohol and sets up her website advertising her products. The website makes it clear that she sells to trade. Potential buyers are told to contact her directly. Although she may not have made any actual sales, she is exposing controlled liquor with the intention of making a wholesale sale. She should have already applied for approval.