Amazon cancels orders made after pricing blunder

Amazon UK has said it would not honour the orders from customers who paid just £7 for Hewlett-Packard Pocket PCs that normally...

Amazon UK has said it would not honour the orders from customers who paid just £7 for Hewlett-Packard Pocket PCs that normally retail for around £290.

The online retailer closed its website for just under an hour on Wednesday 19 March after the pricing error led to a rush of purchases, with some shoppers thought to have placed orders for 50 or 60 of the devices at a time.

In a statement, Amazon said, In keeping with our conditions of use and our pricing and availability policy, we will be cancelling orders made for the HP iPAQ Pocket PCs at the incorrect price this morning.”

Buyers will be given the choice of purchasing the devices at full price or cancelling the order, the company said.

Some of the users who contacted Computer Weekly said they expected Amazon to honour the purchases because they had been sent an e-mail confirming the purchase.

However, the company’s terms and conditions state that, “there is no contract between Amazon.co.uk and the customer for an item until Amazon.co.uk accepts the customer order by e-mail confirming that it has dispatched the item. Until that time, Amazon.co.uk is within its rights to not accept any customer order.

Michael Archer, partner at IT law firm Beale and Company, said Amazon’s conditions of use, particularly with regard to the confirmation e-mail, were not entirely clear.

"Is (the confirmation e-mail) meant to be acknowledgment of the order, or confirmation of the contract?" he said. "We would always advise e-tailers to make the first e-mail an acknowledgment of the order, and state that the contract is not formed until the consumer receives a further confirmation email.

"Amazon’s e-mail provides information on how ‘To cancel this contract’. It could be argued that Amazon are stating that this is acceptance of the consumer’s offer, and it would be surprising if a court were to decide that no contract existed at this point."

This is not the first time an online retailer has been left red-faced following a pricing error. Last February, photography giant Kodak decided to honour customers who bought £329 digital cameras that had been advertised on its website for just £100.

In contrast, when catalogue giant Argos offered televisions worth £300 for just £3 in 1999, it refused to honour the orders, claiming that it had been a mistake and that customers must have known it was the wrong price.

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