Introduction to commercial law:Uni-Garage v Mechania College and Right Pay Employment Agency Pty. Ltd - Essay Example

?Australian Business Law Introduction to Commercial Law: Uni-Garage v Mechania College and Right Pay Employment Agency Pty. Ltd. Introduction The lawis a body of principles established by the parliament and by the courts which is legally enforceable and was developed to set standards of conduct between people, businesses and government. Business law is made up of the laws that set out rights, duties and obligations of people in business balancing the interests of those involved in business which regulates the business under the law of contract, consumer law and trade practices act (Latimer, 2009)1. Australian business law is developed and intended to protect the rights of each and everyone involved in the business transactions. The present paper aims provide the most suitable suggestions to all the parties in the case of misleading and deceptive representations between ‘Uni-Garage v Mechania College and Right Pay Employment Agency Pty Ltd.’ Brief Facts It is observed that Wes, a final year part time student at Mechania College of TAFE registered with Right Pay Employment Agency Pty Ltd so as to get employed after clearing his examinations. Right Pay, after getting a placement suitable for Wes, the agency contacted Mechania College asking for their reference before inviting Wes for interview. The college responded stating that -- “proper records of part – time students are not kept; -- this college has no reason to believe that Wes would not make a trustworthy and diligent worker with any employer –“. Wes was introduced to Uni-Garage, second employer for Wes, who relied on the report submitted by Mechania College referring the candidacy of Wes rather than interviewing him. After few days, Uni-Garage reported that Wes had stolen $6000 from the canteen and is caught damaging the company equipment worth $12000. Uni-Garage – Suggestions The critical analysis of the case reveals that Mechania College has hidden the truth about Wes who was already a miscreant vandalizing school property witnessed by school teachers, maintenance staff and was threatened of expulsion by the Vice Principal which was not recorded in Wes’s School Record File. There were instances when Wes was handed over to police and was warned on various occasions. However, the report submitted by Mechania College on the insistence of Right Pay Employment Agency Pty Ltd., it stated that “this college has no reason to believe that Wes would not make a trustworthy and diligent worker with any employer”. According to Trade Practices Act 1974 of Consumer Protection under Part V – Div I of Section 53 of false or misleading representations, it is stated that “a corporation shall not in trade or commerce, in connection with the supply or possible supply of goods or services or in connection with the promotion by any means of the supply or use of goods or services – shall not make false representations about the standard, quality, value of goods and services”. Mechania College, acting as a representative of Wes, referred him as trustworthy and diligent in its report to Right Pay Employment Agency notwithstanding his previous records and actions of vandalism in school and police warning. Business must not make false representations about goods and services and Mechania College was party to this agreement between Right Pay Employment Agency and Uni – Garage as their student was being hired for employment on the basis of report submitted to Right Pay. Misleading information provided by the college has cost the company Uni-Garage in monetary and machinery loss which is gross misconduct under section 53 and 53 A of Trade Practice Act 1974. Uni- Garage has the right to file a case against both the parties involved in hiring process i.e. Right Pay Employment Agency Pty Ltd and Mechania College for delivering incorrect information and this leads to civil action for damages set out at 8-780 for consumer offences, criminal action leading to fine of up to $1.1 million and a person who suffers damage because of breach of s.53 may recover civil damages under s.82 which lays provision for “recovery of amount of the loss or damage by action --- involved in the contravention.2” Uni-Garage can sue both the parties for false and misleading representation of goods and services (in this case of hiring the services of Wes, supplied by Right Pay Employment Agency and Mechania College) under s.53 and s.53A and claim compensation under s.82 for the damages caused due the hired services as is evident in the case of Hartnell v Sharp Corporation of Australia Pty Ltd wherein the court stated that company’s claim about its goods and services were “extraordinarily wrong misrepresentation” with a fine of $10,0003. Similarly a wine manufacturing company and its two directors were fined for false representations of its product.4 Thus Uni-Garage may sue both the parties for falsely representing Wes resulting in damage of equipments and theft of money under s.53 and s.53A while it may also claim compensation for the damages caused under s.82. Right Pay Employment Agency Pty Ltd – Suggestions Right Pay Employment Agency Pty Ltd is an employment agency with whom Wes has registered to gain employment as soon as he clears his examinations from Mechania College. On receiving probable opportunity for employment of Wes from Downtown Car Builders Pty Ltd, Right Pay Employment Agency Pty Ltd requested Mechania College of TAFE to refer his student and recommend his name for employment. The college responded stating that the institution does not maintain proper records of part-time students and also providing enough reference to consider its student for employment as they didn’t find any reason why he should not be given the opportunity and “has no reason to believe why Wes could not make trustworthy and diligent worker with any employer”. According to the brief facts of case, it is mentioned that Wes employed with Uni-Garage, also hired through Right Pay Employment Agency Pty Ltd caused material losses and theft at the company resulting in damage of placement agencies reputation and claim of compensation by Uni-Garage. In respect of this, Right Pay Employment Agency Pty Ltd has the right to sue Mechania College of TAFE for providing incorrect information about their student and misleading the other two parties involved. It was on the basis of report referring the candidacy of Wes for employment by Mechania College that Uni – Garage had employed Wes and Right Pay Employment Agency Pty Ltd can sue the college authorities for false and misleading representation of their student for the purpose of employment by hiding his miscreant behavior, criminal activities and vandalism and stating him as diligent and trustworthy. In view of the above, Right Pay Employment Agency can make claim for compensation under s.53 and s.53A of Trade Practice Act 1974 of Australian Business Law wherein under s.53A it is clearly stated that ‘a corporation must not make false representations about goods and services’.5 In this context, it is to mention that student of particular college may be considered as a product whose services were hired by Uni-Garage through an employment agency Right Pay. It is further mentioned that section 53 targets a “corporation” acting in “trade or commerce”, in connection with the supply or possible supply of goods or services” which makes it clear that Mechania College of TAFE is responsible to act with honesty while representing its student for employment failing which it has not only caused material losses to Uni-Garage but has damaged the reputation of Right Pay in the market industry. Right Pay Employment Agency can seek compensation under s.53 and s.53A of the Trade Practice Act and also has the right file for injunction before the Commission for Mechania College of TAFE under s.80 as it contravenes the provisions laid under Part V of Trade Practices Act 1974. Mechania College – Suggestions Mechania College of TAFE faces serious challenge from both, Right Pay Employment Agency Pty Ltd and Uni – Garage. It is evident from the facts of the case that Mechania College of TAFE has concealed the truth about Wes’s previous notorious records about his vandalism, damaging the school property. The college was well aware of his acts as teachers and other staffs have seen him while damaging the property was also warned by the Vice Principal for expulsion. The school authorities have also hidden the fact that Wes was also cautioned by police for his acts of vandalism. But, notwithstanding previous actions of Wes, Mechania College stated in its response that it does maintain proper record of part-time students while recommending Wes for future employment stating no reason “why he cannot be trustworthy and diligent worker with his employer”. This report has landed the college in trouble with the parties, placement agency and employment agency, both having the opportunity to sue the college administration and seek claim for compensation under s.53 and s.53A of Trade Practice Act 1974 and even file an application for injunction under s.80 for contravening the provisions specified under Part V of the act which includes false and misleading representations in business practice.6 Considering both the threats of seeking compensation and injunction, it is advised that Mechania College of TAFE may settle the matter out of court by conciliation and file for stay on injunction under s.80AB of Trade Practice Act, 1974. Section 80AB provides opportunity to seek stay on injunction or any other claims by other parties, if the court considers that granting the stay “would be likely to facilitate the settlement of the dispute by conciliation” under s.80AB (e)(i) and ‘would, in all the circumstances be just’ as specified under s.80AB(e)(ii)7. Conclusion Mechania College of TAFE is an educational institution considered to producing human resources to satisfy the demands of manpower and hence it is party to the Australian Business Law and has to abide by the rules and regulations laid under the law. It is representative to all its students through certification and letters encouraging the employers to recruit its students. Therefore, in respect to present case, Mechania College is liable to both the parties and is advised to settle the issue out of court to avoid damage to its reputation. References 1. Latimer, P (2009) Australian Business Law 2009 - 28th Ed., CCH Australia Limited, Australia 2. Trade Practices Act 1974, Office of Legislative Drafting, Attorney General’s Department, Canberra, Australia 3. Hartnell v Sharp Corporation of Australia Pty Ltd (1975) ATPR, 40-003, 8-780, 4. TPC v The Vales Wine Company Pty Ltd (1996) ATPR 41-480 5. Ibid n.1 535 6. Ibid, n.2 Enforcement and Remedies, Part VI, 287287 7. Ibid. n.2 Read More