Business and Contract Law in Australia - Case Study Example

Name: Instructor: Course: Date: Business Law My client Jimmy approaches me in search of some advices. Jimmy wants to know whether he has a legally binding and valid contract with Massive Freak and if therefore he can sue them for contract breach. This essay will discuss about this legal issue i.e. if the Massive Freak Company is under obligation to pay Jimmy $5,000 as he has participated in the Massive Freak Challenge and failed to get 20% of his body weight after 14 days. It is believed that the deceptive and misleading conduct of Massive Freak has breached the contract. Therefore, Jimmy is able to ask for redress. Jimmy opted that by consuming the product, it would be a perfect solution to his problem. He consumed Massive Freak Drink in line with the directions given by Massive Freak from 2 June-15 June 2014. The two entities are Jimmy and the Massive Freak Company, and their agreement on the infomercial grounds is legally bound. Massive Freak offered to pay $5,000 dollars to anyone who consumed their product but failed to attain 20 % of their body weight. Jimmy on the other hand opted to take massive freak expecting to see a change on his body weight. Even though Massive Freak claims, it is under no legal obligation to pay the money as a drink. Chapter two of the ACL provides for ‘General Protections’ (Carter, David and Kevin 3). These ‘general protections’ establish the canons of conduct for companies in the market. Conduct as a vital part of business in this case has been compromised. Massive Freak is in violation of business conduct owing to chapter two, which bans deceptive or misleading conduct in commerce or trade. The provisions of chapter two apply in protecting Jimmy from the deceptive infomercial. Thus, Massive Freak is under obligation to pay as it has contravened part 2-1 on deceptive or misleading conduct of businesses under chapter two (Carter, David and Kevin 3). Moreover, part 2-2 prohibits unconscionable conduct to consumers. In this case, the conduct of Massive Freak is unconscionable conduct in business and more significantly in this kind of a business transaction. Section 34 in Australian Consumer Law recognizes the misleading conduct concerning the provision of goods and services; the characteristics, suitability, and natures for their quality or purpose of any services are significant in this segment (Carter, David and Kevin 4). In Jimmy’s case vs. Massive Freak, the later has to pay because of the changed information. Under the ACL, misleading or false representations about services or goods is prohibited. Massive Freak has made false and misleading representations in light with the supply of massive freak and in connection with its promotion for the supply of the product. This case is significant because it demonstrates that misleading services are unacceptable. Massive Freak run a wrong infomercial to influence my client Jimmy. The infomercial did not serve its purpose as intended. Therefore, the product about deceptive or misleading conduct is unacceptable. Additionally, the conduct by an individual, the activity of trade, and deceptive or misleading conduct, or conduct with potential to deceive or mislead are three attributes, which comprise of section 18 of the Australian Consumer Law (Carter, David and Kevin 4). The Australian Consumer Law retains the general ban on deceptive or misleading conduct, which occurred in part 52 of the TPA as well as the “State and Territory fair trading Acts” (FTAs). By identifying the three basics, any persons or business can against the entity, which is misleading or likely to mislead or conduct (Carter, David and Kevin 5). In this scenario, Massive Freak is to provide a product, which will guarantee that their consumers gains 20% of their body weight as a commercial activity. If the infomercial, statement, representation, or promotion from the business can culminate to the misleading impression in consumer’s mind, the demeanour might break the law. Massive Freak has changed the information in its infomercial after my client had started using the product. Moreover, the company has offered a product with a product, which is different from what my client anticipated and in the process providing the misleading impression in my client’s mind. In summary, the conduct of Massive Freak can be considered as deceptive and misleading according to the three elements. The prohibition of misleading demeanour in trade or commerce under Sec: 18 prohibition of an individual, in commerce or trade is not restricted to the supply of services or goods and it creates a wide, economy-range behaviour norm. Under part 3-1 of the Unfair Practices of section 18, the Australian Consumer Law bans specific unfair acts in commercial activities (Carter, David and Kevin 5). These particular bans are grounded on the prohibitions presently outlined in TPA’s Part 5, and in some cases, draw on present requirements in State and Boundary consumer legislations. Certain false or misleading demonstrations regarding commodities or amenities, and some particular conduct associated with the giving of prizes and gifts, reimbursements, bait promotion, as well as other kinds of conduct. Thus, it is wrong on the part of the Massive Freak Company in making false or misleading representations in relation to the delivery of their services or goods with advertisements by any ways of the delivery or consumption of their product. Massive Freak is barred from misleading or creating false depictions in line with the promotion of their commodity. In this case, their activities are banned by the ACL on grounds that their goods are not of the specific value, standard, quality, composition, style of use and more particularly they do not show a history of previous success upon their use. The goods have failed to provide the exact performance characteristics on their uses or benefits. These representations mentioned relate with those that are already covered under section 53 of the TPA. The ACL also prohibits specific kinds of misleading conduct or representations or conduct. Under section 33, the Massive Freak’s conduct is accountable for misleading my client as to the traits, suitability, and form for their aim. Moreover, the company has contravened section 37, which bans misleading or false representations on the benefits of other major aspects of the activities of Massive Freak such as its changed stipulation on their challenge. Section 32 of the Australian Consumer Law prohibits an individual from offering reimbursements, prizes or gifts or other free commodities in on with the delivery or likely supply or product promotion by any manner of goods or services (Carter, David and Kevin 6). Under this law, Massive Freak is prohibited from stating to provide a good or service with no intentions of providing them notwithstanding how common such advertisements are widespread. Additionally, Massive Freak has failed to provide the $5,000 dollars, as provided, within the documented time in the promotion, and within a reasonable time. Under Sec: 32 the law broadens the range of the TPA’s section 54 by necessitating that delivery is on time. In my client’s situation, the ad documented that Massive Freak would pay $5,000 to any individual who took the Massive Freak Challenge and was unsuccessful to gain 20 per cent of their body weight within a period of 14 days. Therefore, by offering any kind or rebates, or other items that are connected to the sale of goods and services, Massive Freak is under obligation to honour the offer under section 32 of the Australian Consumer Law. Section 32 of the ACL considers that a stated time for provision of the reimbursements, prizes and gifts or commodities that are given freely will be considered a reasonable time if mentioned in the offering. The Massive Freak offer documented to reimburse to their clients after 14 days of the use of their product before changing their stipulations. During this period, my client was seriously engaged in the Challenge and as a result, he did not see the freshly introduce infomercials with the voice-over mentioning the end of the Challenge. By basing on Massive Freak agreement, and grounded on the nature of reimbursement offered for the unsuccessful clients, the period for claiming the reimbursement is within the stipulated time. Unlike associated doctrines in contract law, such as the misleading or deceptive conduct or misrepresentation, applies to any conduct, which is likely to be, deceptive or misleading and does not necessitate the making of a representation. Conduct by Massive Freak is deceiving as there is a "real and not remote" possibility that it will deceive or mislead. After the examination, it is accepted that Massive Freak has deceptive and misleading conduct; as a result, Massive Freak cannot perform the obligation in its infomercial. Therefore, Massive Freak is in breach of the contract, so Jimmy can ask for reimbursements. Jimmy can sue Massive Freak in a court of law for contract breach. Moreover, my client Jimmy has agonized over disappointment and disillusionment and this may affect his feelings because he has been tormented for a long time now. As a result, Jimmy can ask for remedies and restitution. What is more, Massive Freak may get the fine because of its deceptive and the misleading conduct. Deceptive or misleading conduct is a "strict liability" crime, in that it does not matter if the conduct was intended to deceive or mislead or even whether the plaintiff could sensibly have protected its interests. This suggests that so long as there is a component of reliance on my client’s part, the Massive Freak Company could be found to have participated in deceptive or misleading conduct even if they had every reason to confirm that their demonstrations were true. The aim for strict liability in this case that Massive Freak has made a representation that is not better situated than the individual relying on the representation. Therefore, this law will ensure that the representation applies onto the individual making it. In conclusion, Massive Freak has the deceptive or misleading conduct. The reason of the deceptive or misleading conduct has been extensively deliberated in this essay. Massive Freak has an obligation to meet as it has breached its contract with my client and gone against the provisions of the ACL. This explains why Jimmy can take legal actions to ask remedies to against the massive Freak. Work Cited Carter, John W., David J. Harland, and Kevin Edmund Lindgren. Contract law in Australia. Sydney: Butterworths, 1996. Print. Read More