Analysis of Business Law - Case Study Example

Bal’s Case In order to come to a conclusion about what Bal needs to do, Bal’s situation needs to be summarized, and then examined. M. J. Electrical offered VX48 twin-disc DVD-HD recorders were available for £380 by mail order; Bal purchased it. She then got a letter stating that the item had become difficult to get and that a different model with a cosmetic difference could be applied (Adams, 2006). She tried the machines when she came back from her two week vacation and found that they were perfectly adequate in re-playing pre-recorded DVDs but produced very inferior quality copy recordings Accordingly, she sent the machines back to M. J. Electrical, explaining in a note that it was not the machine she had ordered (Adams, 2006). M. J. Electrical refused to accept the machines or to make any refund of the purchase price. They pointed to a clause contained in the documents sent with the machine and reproduced on their website. The clause said that, no liability for the quality of the goods would be accepted if any unauthorized repair or inspection of the internal components had been made. Before Bal had sent the machines back, she had allowed her friend Ahmad to open them up to examine the DVDE writer. However, although there was clear evidence that this had been done, Ahmad had not removed, replaced or repaired anything (Adams, 2005). Bal’s situation can fall under both contract law and mispresentation. In the following paragraphs, both of these concepts will be addressed in order to give advice to Bal. First, mispresentation needs to be defined in order to clarify Bal’s situation. What is mispresentation? According to Brittanica Online Encyclopedia (n.d.): in law, any representation by words or other means made by one person to another that, under the circumstances, amounts to an assertion not in accordance with the facts. A misrepresentation is an assertion not in accord with the facts that is made with the intent to mislead or deceive; as such it can constitute fraud. How does this apply to Bal’s situation? Bal had actually ordered a different type of DVD burner, and this is the major notion that the law needs to focus on and come back to. It is important to remember that the problem stemmed from the fact that Electrical explained that VX48 machines had become very difficult to obtain and that VX47 models would be supplied, and sent her a new machine without her permission. Whether or not Val’s response was delayed is not an issue, she should not have been given an item she did not order. This breaks the idea of what was originally advertised and presented. Therefore, the facts here have been disrupted, and Bal clearly has a case at this point. Bal never gave permission to get the different type of DVD player. Thus, whether or not the item had actually been sent, opened, or anything else should not matter at this point—the customer should be able to return an item if it was the wrong item shipped. Most companies do hold to this agreement with its customers. The fact that Electrical does not makes the entire situation with Bal suspicious. She should be able to return an item if it was not what she ordered, whether or not she actually took time to reply. The company should have contacted the customer, and then awaited a response to make sure that sending her a different DVD burner was acceptable. There is also another fact that goes along with the fact of mispresentation. This is the fact that the DVD burner did not work well or meet the expectations of the customer. The product needs to successfully provide the basic service that the customer is purchasing it for, and in this case, it obviously did not. Bal did try to use the DVD burner and assessed it before making any decision. She had it opened in order to make sure it was functioning correctly, and it was. At this point, even though she did have it opened, it becomes obvious that the DVD burner is not the item really advertised by the company, since it does not successfully do what the customer needs. In order for businesses to get good reviews from customers, earn returning customers, and form their own good reputation, they need to provide customers with items that work successfully and meet the standards they are advertising. If they are not doing this, they are advertising falsely, and thus this falls in line with the concept of mispresentation. As mentioned earlier, Bal’s issue also has a contractual side to it. In order to better understand this situation, contract needs to be defined. Larson (n.d.) defines this contract: A contract intends to formalize an agreement between two or more parties, in relation to a particular subject. Contracts can cover an extremely broad range of matters, including the sale of goods or real property, the terms of employment or of an independent contractor relationship, the settlement of a dispute, and ownership of intellectual property developed as part of a work for hire.” What did the company state in their supposed contract? This actually comes from a statement made by the company: “no liability for the quality of the goods would be accepted if any unauthorized repair or inspection of the internal components had been made. Furthermore, there are several steps to making a contract that seem to be ignored in Bal’s case. Larson (n.d.) defines this as follows: A "Meeting of the Minds" (Mutual Consent) Offer and Acceptance Mutual Consideration (The mutual exchange of something of value) Performance or Delivery Good Faith No Violation of Public Policy The big question here, however, is whether or not the company actually informed Bal of this contract. In the story provided, we have no information that the company ever said this in any type of paperwork sent to Bal when the item was purchased. If the company did not include this contract or did not advertise it so it could be seen by all customers, then they cannot use this excuse to assist their needs. However, if the concept was provided clearly and Bal simply overlooked it, then Bal would not have a case in response to the contract. In this case, it does sound that Bal was not provided with the warning, since no paperwork was mentioned and no other type of contract was mentioned. Companies cannot state policies or make up items after the fact in order to refuse an order, especially if the order was not what the customer really wanted in the first place (Adams, 2006). Taking a look at Larson’s list, it does not appear that any part of the contract was provided by the company. There was no clear mutual consent, or meeting of the minds, because the policy was not clearly provided to the customer. Furthermore, there was also no clear offer and acceptance here. The customer did buy a product, but it was not the product that she initially wanted. Furthermore, she obviously did not accept the product as it was because it did not work well enough for her. The idea of mutual consideration also fails here because Bal’s feelings are not really being considered, as she is rejecting the DVD burner outright. Performance is also a problem with this DVD burner, since it clearly does not work as specified. The next item, good faith, is a further issue. Bal purchased this thinking she was going to get a different product, and a product that actually worked as well. Neither of these were provided for her. There does not seem to be a clear violation of public policy, but the fact that the contractual idea was stated after the fact does present a problem. Therefore, when giving Bal advice, all of the above would be presented to her in order to assist her with her case. She has something to consider based on two notions; that of mispresentation, and that of contract law. With mispresentation, it is an obvious case because she was not sent the item she ordered, and the item did not perform properly as advertised. This concept violates most company policies, as most companies will allow a return if the wrong item was sent. The company should have awaited Bal’s response about the item to see if she wanted it. Contract law is the other issue in this case. The company cited a contract so they would not have to take the item back, but that contract only emerged after the issue became apparent. Bal was not warned about this prior to purchasing the product. Therefore, Bal has a few outlets that she can consider. References Adam, A, 2006, Law for Business Students, New Jersey: Prentice Hall. Longman. Encyclopedia Britannica, n.d . Mispresentation. Retrieved June 15, 2009 at: http://www.britannica.com/EBchecked/topic/385341/misrepresentation Larson, A., n.d. Contract Law . Retrieved June 15, 2009 at: http://www.expertlaw.com/library/business/contract_law.html Read More