Contact Law between Holy Farm and Brighton Greens - Case Study Example

Running head: Tourism and Hospitality Law Tourism and Hospitality Law Name Course Tutor Date Introduction The dynamic growth of technology and the subsequent emergence of paperless contracts involving various business transactions have prompted the Australian government to enact legislations to govern such activities. The interactive nature of the internet as a global and dispersed communication medium has facilitated various business due to the business contracts that arise. However, challenges of using have however emerged ranging from areas of jurisdiction, privacy, and protection of intellectual rights (Zelst, 2008, 198). This has seen the developments of various legislations that oversee the smooth running of business done over the internet by providing a clear-cut difference between the paper environment and electronic environment. It is important to note that contracts and business in general are important since they enhance the building of a concrete consumer confidence and the overall success of a business. With the aim of ensuring a success on the handling of e-commerce, various legislations have been enacted to govern the handling of transactions over the internet. This includes the Commonwealth Parliament of the Transactions Act 1999 (Cth) and this had formed a good base and provided an ample business environment. This discussion will evaluate the aspect of contact law between “Holy Farm” and “Brighton Greens” (UNCITRAL, 2002, 215). The contract A brief look at the transaction that took place between “Holy Farm” and “Brighton Greens” grocery store shows that goods were advertised over the internet. Richard who owns the grocery was able to examine the sampled apples offered by Holy Farm that prompted him to place an order via email dated August 1. Further details of the order indicate that twenty boxes of the Grammy Smith apples were to be delivered and a cheque mailed the same day (Felemegas, J. 2007). The apples ordered by Richard were specifically those provided by Holy Farm. It is however noted that due to the overwhelming orders made by other customers, they could not be able to meet the demand and this prompted them to acquire apples form others farmers so that they could be able to counter the demand. It is however noted that the apples from other farmers were of poor quality compared to theirs (Cavazos, & Morín 1994, 34). During the period when the business was being transacted, it noted that there was miscommunication between the two parties characterized by the delivery of goods whose order had been cancelled via a text message (UNCITRAL. 2002, 215). This scenario falls in the confines of the laws of the Australian government governing any electronic transactions which seem to work effectively through the enactment of supplementary legislations. Such legislations are basically aimed at ensuring that paper and electronic transactions are treated equally and at the same time minimizing discrimination on all the forms of technologies used (Bagley, & Dauchy,. 2008, 194).In addition to this, regulation form such legislations are aimed at ensuring that electronic transactions such as the one between Holy Farm and Brighton Greens is handled like the paper transaction. This is seen to promote business through the enhancement of consumer confidence over the use of such modes of transactions (Williston, 1988, 522). In so doing, electronic dealings between government and individuals will be enhanced thus promoting the existence of contracts even in the virtual world. It is very necessary put into consideration the fact that the laws of the Commonwealth Parliament covers the common law and the existence of a contract through electronic transactions should not adopt any other law (Wahl, 1998, 522). It is evident from the explanation given herewith that this is a business to business transaction facilitated by the blooming internet economy. The Holy Farm Company has managed to use their portal to manage their sales. The initial stage of transacting this business shows that there is an existence of a contract between these two parties (Winn, & Wright, 2001, 66). A contract is a legally enforceable agreement where two or more parties commit themselves to certain obligations in exchange of certain rights. Various phases are involved in ensuring that the process of conducting the business whether online or physically succeeds (Zelst, 2008, 198).. The first phase involves the pre-contractual phase whereby the customers identify the goods in which they intend to purchase. In the case study given we clearly point out that this phase was adequately considered given the fact that Richard Brat of Brighton Greens identified the Granny smith apples. The contractual phase follows where there is creation of a business relationship between the two parties. The relationship in this scenario is evident by Richard’s visit to the Holy Farm where he managed to sample the apples and was able to clearly point out with certainty that those from Holy Farm was his best choice (Jennings, 2005, 298). The next essential phase is the ordering and logistics phase and this was done when Richard placed an order that started in part, “Please deliver 20 boxes of your Granny Smith apples to my Brighton Greens grocery store”. The goods were later delivered. This was followed by a settlement phase where invoicing and payment was done when Richard authorized payment through the sending of mail detailing the cheque that would settle the bill for the goods purchased. The processing phase was however not done because of the communication breakdown encountered between the two parties (Dustdar et al 2006, 290). If the purchase would have been successful, Holy farm would be required to collect trade statistics from the sale of their goods. The phases outlined here make the transaction between the Holy Farm and Brighton Greens qualify to be an enforceable contract. This is because the essential elements of a contract are evident. They include mutual consent, offer and acceptance, mutual consideration, delivery, and non-violation of public policy (UNCITRAL 2002, 215). A contract is enforceable whenever is a mutual understanding for the purchase of apples between the two parties. This was followed by acceptance by Richard exemplified by the offer for the payment of goods ordered. This offer was made in the form of a cheque confirmed by the mail sent to Holy Firm. In addition, there is a mutual consideration. This basically means that one product was exchanged for a certain value between the willing buyer (Richard) and the seller (Kelley). The delivery of goods on the premises of Richard is another element an enforceable business to business contract. Additionally, surface observation of the whole exercise indicates clearly that the whole process did not violate any public policy (Monczka et al, 2008, 501). A contract is deemed to be valid if all the elements are dully followed to the later without breaking any of the agreement between the parties involved in the transaction. It is observed from the order placed by Richard that he required Grammy Smith apples specifically from the Holy Farm (Meier, & Stormer, 2009, 91). They however faced overwhelming orders forcing them to buy low-quality apples from the neighboring farmers so as to counter the shortage. In fact, they only gave out their fruits as samples to customers but sold and delivered the poor quality apples to its consumers. Any business transaction is built on good faith. It is obviously expected that the customer is to be supplied with the good in which he has ordered and should be informed of any changes that may come across (Roemer, 2004, 25). This is because the business to business transaction is governed by local and international laws that aimed at protecting the rights of consumers. The breach of the good faith between the buyer and the seller is a very serious offence that nullifies the whole contract. This is because the wrong types of goods were delivered and greatly different from those ordered by Richard. Additionally, on realizing of the poor quality of the apples Richard took a step and canceled the order by sending a t ext message (Pakroo, 2006, 178). The message was delivered to Holy farm but sadly enough, Kelly gives a lame excuse on being illiterate and not able to send or read a text message via a mobile phone. How could it have been possible for them to read and email but not able to read a text message? The actions by Holy Farm of delivering the wrong type of goods from those that were ordered and ignoring an initial message that would have averted the existing crisis is a breach of the good faith that existed between the two firms (Ahmadu,. & Hughes, 2006, 263). Additionally, the delivery of the wrong types of apples different from those ordered by Richard violated the right of the consumers. These two actions nullified the contract that initially existed between the two parties in the business (Schneider, 2008, 226). Statutory rights It is always assumed that a contract exist between the buyer and the seller by thee time goods are delivered. It is however important for the seller to note that, no matter how stringent his/her terms may be concerning the goods sold, statutory rights exist (Brodecki, 2003 440). These are consumer right and can never in any way be changed by the seller. As is always expected, the consumer should at all time give specific descriptions for the goods they intend to purchase (Marsh, & Soulsby, 2002, 190). This is exactly what Richard did before purchasing the apples from Holy Farm. They were to specifically originate from their farm (Twigg-Flesner, 2003, 119). However, the apples supplied were of poor quality leading to customer rejection and would ultimately lead to loss-making in the side of Richard (Sihombing 1997, 96). To avoid such scenario in the future, Richard would have to be aware of his statutory rights that may protect from dishonest business partners like Kelley of Holy Farm. Two types of statutory rights exist for any consumer (Bradgate, & White, 2007, 202). These are statutory conditions which are the essential terms of the contract that clearly specify that goods must be merchantable, must match the description given, and have clear title of the goods (Sterling, 2001, 212). Statutory warranties also exist for the consumer and cover the damage for the goods within a specified period of time (Bridge, 1997, 314). It is therefore the statutory right of Richard to Return the goods to Holy Farm and get his money back because the goods supplied did not match the description that he had given out (Šarčević, & Volken, 2001, 125). This is done irrespective of Holy Farm’s refund policy. This is because the apples supplied are not up to the consumers’ standards and tastes (Ison, 1979, 162). Conclusion Handling of electronic contracts is a very tricky and challenging issue and requires both the seller and the buyer to act diligently. Absence of hard copy evidence does not guarantee the violation of e-commerce laws (Campbell, 2007, 228). In fact everyone should be ready to embrace the use of technology in conducting their business due to its versatility and ease. It is also important for consumers to know their rights to avoid being mistreated by dishonest parties. Word count before referencing: 1727 Word count after referencing: 1833 Bibliography Ahmadu, M. L. & Hughes, R. A. 2006. Commercial law and practice in the South Pacific. Routledge, pp 263 Bagley, C. E. & Dauchy, C. E. 2008. The entrepreneur's guide to business law. Cengage Learning, pp 194. Bradgate, R. & White, F. 2007. Commercial Law. Oxford University Press, pp 202 Bridge, M. 1997. The Sale of Goods. Oxford University Press, pp 314 Brodecki, Z. 2003. Polish business law. 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