Cooking Contracts with Caroline
Welcome back to Contracts with Caroline a blog where I use the knowledge I’m gaining through law school to demystify topics (through legal information certainly not legal advice; I’m only 1/6th of the way through law school). The narrative that students don’t know how to cook and live off of mac and cheese is going to disappear if meal prep services have anything to do it. This post is going to outline how you enter into a contract with Hello Fresh and compare it to other meal delivery services!
Section 1: What Am I Signing Up For?
Your initial contract with Hello Fresh Canada Inc (Hello Fresh) is a standard form contract for a subscription service that subjects you to all of the company’s terms and conditions. This is because Hello Fresh is the offeror and the master of the offer, and you are the offeree, the individual accepting the offer. This contract is enforceable due to the consideration flowing from you to Hello Fresh through the first payment you make. This is a bilateral contract as it is an exchange of promises for actions set to occur in the future.
Car Contracts Tip: If a company outlines their terms and conditions online, whether you read them or not, you’re bound by them, so always skim them! (Rudder v Microsoft)
Your contract for the subscription service means that you have agreed to an initial charge and a series of subsequent charges until you deactivate your account or Hello Fresh deactivates your account at their discretion. Hello Fresh considers their subscription as a flexible subscription because the offeree(you) still has flexibility as to whether to skip a week in addition to weekly meal selection despite the overarching enforceable subscription contract.
Notice there is no mention of the food you’re getting yet? This is where it gets interesting …
Section 2: The Conception of Offeror and Offeree
Once you enter into contract with Hello Fresh your screen looks like this every week as you pick delicious meals.
Hello Fresh conceives of the meal selection process as:
1. You select your desired meals and make an offer to purchase them at the price stipulated in your original subscription or for an increased price Hello Fresh outlines
2. You receive an e-mail from them acknowledging your offer
3. You receive a confirmation e-mail where they accept your offer for that week
The conception of you (the client) as the offeror and the service provider (Hello Fresh) as the offeree is noteworthy. The concepts of offeror and offeree and when a contract is formed are flexible and companies can try to choose a conception that best protects their interests. This is seen through Pharmaceutical Society of Great Britain v Boots Cash Chemists (Boots), where it was held that in a self-service environment, the customer is the offeror, and the cashier is accepting their offer to purchase whatever was on display. Hello Fresh’s conception of offer and acceptance is analogous to the Boots case as they would likely consider their website a self-service place where their products are on display via picture, you the client makes the offer, and their team accepts it and you are notified via your confirmation e-mail. That week’s order and contract are not binding until they accept it and send you a confirmation. However, if you fail to select your meals or skip a week on your account by their deadline, you will be sent meals they select for you as per the terms agreed upon in your original subscription contract. The dissent in Regina v Dawood considered the display of goods with prices as an offer to sell, and this is how I conceived of the Hello Fresh website prior to my deep dive for this blog post. However, I should have remembered Canadian Dyers Association Ltd v Burton where a mere quotation of price was not an offer to sell. Moreover, I wondered whether the selection page was an invitation to treat but rather than being an advertisement it is a selection page for those already subscribed. As Hello Fresh is the master of the original subscription service offer, I found it interesting that the role of offeror and offeree switched between the parties when dealing with the weekly contracts. Despite Hello Fresh choosing the meals to offer you and their stipulation of price, they still found a conception where the client is the offeror, so they have the ability to reject your selection.
This means:
1. When you select your meals, Hello Fresh could reject instead of confirming your order, and so you don’t get the food you requested and must re-select
2. Hello Fresh could confirm your order, but it could still subject to substitutions because the original subscription contract stipulates there may be substitutions
Section 3: Contract to Contract?
This is possible because your relationship with Hello Fresh can be understood as two different levels of contracting:
1. A contract for the subscription service — functional until deactivated by a party
2. A term within the subscription contract is entering of mini contracts each week where you offer to buy certain foods, and Hello Fresh chooses to accept or reject that offer
In class, we considered whether you can contract to contract and the enforceability of agreements to negotiate. Shown in Hillas & Co v Arcos LTD (Hillas), there can be a contract to enter a contract if there are specified terms that are simply taking place at a future date. This subscription service can be considered a contract to contract because the materials terms of the contract have already been specified including: the price, delivery date and frequency of delivery — the only thing left to be decided is the content of each meal kit which can be understood as an immaterial term. This can be distinguished from a case like May & Butcher Ltd v R, HL where the critical terms were yet to be decided and so it could not be an enforceable contract. While you may consider the food you are receiving as the most essential thing about your agreement with Hello Fresh might disagree. They might disagree because they know you’re getting meals they have in stock and they still have the ability to reject your offer on meals if they cannot deliver. Like Hillas, the facets of the contract that have not yet decided are not detrimental to the contract actually going forward. This is a process agreement as the original subscription is an agreement of terms or rather meals to be agreed upon. The mini contracts of the week are negotiations of immaterial smaller terms that were not specified through your original contract for the subscription service.
Out of curiosity, I decided to check other meal delivery services and whether they had the same conception of offer and acceptance. From Hello Fresh’s perspective, their conception makes sense because they are able to reasonably estimate revenue based on how many subscription services are sold, and they are not on the hook to deliver certain meals if their stock is low. Rather, they can reject a customer’s offer so they must select meals they have in inventory. I assumed based on these facts their practices would be standard across their competitors however, other meal services: Chef’s Plate and Good Food were different.
Section 4: Comparing the Contracts of Food Subscription Services
The first thing I noticed when comparing the terms of all three subscription services was the common language and statements within all of their terms of use. Perhaps the standard language used can be considered boilerplates and is common throughout the industry of food subscription services. However, distinguished from Hello Fresh, both Good Food and Chef’s Plate do not go into the detail of the mini contracts for foods that need to be decided. Rather, within the original contract for the subscription service, it is a term that meals are chosen periodically at the stipulated cost and time. Meal selection is considered a term of the original contract as opposed to mini — contracts for food. While Hello Fresh’s conception may be most beneficial to the company, Good Food and Chef’s Plate’s conceptions assures that you will get the meals you select because they have no opportunity to reject your selected meals. Those two companies likely just remove meal options from their site when all their inventory is spoken for.
Also ! Note that if you decide to gift your friend a box that they ordered they could not call Hello Fresh with complaints — due to privity of contract the general rule is only parties to a contract can sue! (Dunlop Tyre v Selfridge). Thanks for tuning into another blog post of Contracting with Caroline, today we covered a contract to negotiate with a vague term, conceptions of offeror and offeree and how to make your Tuesdays yummier. I hope to see you back next term! If you were wondering what my pick of all the services is … Hello Fresh gets my top mark for taste!
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