Legal Rights and Obligations - Case Study Example

Clara and Joseph decided to renovate their house and add a large, enclosed entertainment area. Having completed an architecture degree, Joseph decided that as the area will be enclosed, a timber flooring would be the most environmentally friendly material, as well as being the most hard wearing and aesthetically appealing.   Knowing exactly what he wanted and how he wanted the final product to look, Joseph placed an advertisement in the local newspaper on 5 February 2017.   Quotes for floating timber flooring: seeking quotes for the supply and installation of floating timber flooring for an area 100 square metres. Best quote will be considered. Closing date for submissions is 25 February 2017. Quotes to be emailed to Joseph@businessasusual.com.au   On 8 February 2017, Marshall, who owns Indoorooms, completed a standard form quote based on $40 per square metre. At the bottom of his quote, Marshall’s quote states: “Provider accepts no responsibility for defects in workmanship.” Marshall emailed the quote as required.   On 12 February, Edward emailed Joseph quoting $38 per square meter. However, due to a power outage caused by a severe storm, neither Joseph or Clara received the email until 16 February 2017.   On the 13th of February, Joseph phoned Marshall and accepted his quote of $40 per square metre. It was agreed that Marshall would commence work the following day.   By the end of the day on the 16th of February, Marshall had laid 55 square metres of the flooring. However, there was heavy rain during the night and when Clara and Joseph inspected the new room in the morning, they found it flooded. Not only was the room flooded, but a portion of the land under the room had subsided and the floor collapsed. It seems that Marshall left the door to the room open to allow the enclosed space to ventilate. This would ordinarily not have been a problem, but a tool bag appears to have placed over the drainage outlet not far from the door. It appears that this may have caused the flooding.   When Marshall arrived to complete his work, Joseph would not let him. Joseph was screaming abuse at Marshall telling him to ‘get out and never come back’. No amount of apologising was calming Joseph, not even offers to complete the work at reduced price. Eventually, Marshall left asking Joseph to contact him so that they could arrange for the work to be completed.   A short while later, when Joseph opened his email, he found Edward’s quote. Joseph phoned him and arranged for him to complete the floor just as soon as the structural issues were corrected. Edward agreed to complete as soon as the floor was structurally sound. At some point during this conversation, Joseph had told Edward he was the cheapest quote.    Both Edward and Marshall are threatening to commence legal action against Joseph and Clara for breach of contract. However, Joseph believes he also has a counter claim against Marshall.   Advice Joseph and Clara of their legal rights and/or obligations, and the likelihood of a successful action being brought by either Edward or Marshall. Your answer MUST be supported by relevant case law.     Your assignment must be written in the third person, in the form of a legal essay. The maximum length of your essay is 1500 words, +/- 10%. Referencing must be in accordance with the AGLC3, which can be found on the library website. A contract is simply an agreement, which legally binds different parties1. A party of contract is always bound, because he or she has entered into agreement to be bound. Accordingly, a valid contract exists between Marshall and Joseph and Edward and Joseph where the Edward and Marshall were given a contract of supplying and installation of timber flooring, and there is need to prove that there was an offer, which was accepted. Moreover, there are the need for intention from all parties to create legal consideration and relations2. Therefore, before concluding that there was contract that gave rise to the enforceable obligations, there is need to establish the existence of agreement that binds the named parties. Then, it will be easy to establish a breach of contract, which takes place where a party refuses or fails to honour the duty imposed upon it under the contract terms. For such reason, there is need for this paper to establish whether there is a breach of contract between Marshall and Joseph and a breach of contract between joseph and Clara. The case where Marshall had an agreement with Joseph to supply materials and install timber flooring seems to show the intention to be legally binding—and it is highly important to perceive it as an offer. When there is a treat to invitation, the purchaser makes an offer, and the owner will accept or reject it3. The courts will have to determine whether the proposal was an invitation to treat or an offer depending on used language and circumstances. Edward decided to make the tiles even though the workmanship was poor, but he pleaded to complete the work at a reduced price. If it is established, an offer is a willingness expression to contract on a specific term made with intention to ensure the existence of a binding contract. An offer should intend to make an agreement binding legally4. The acceptance is said to have been received when the two parties are in a position to accept it. In this case, there was an offer between Joseph and Marshall since acceptance took place. Marshall sees an advertisement in local news and decides to make an offer for his materials. The advertisement of Joseph cannot be perceived as an offer because the general rule that is normally applicable to the advertisements as the advertisements will always constitute an invitation to treat in bilateral contracts. In Gibson v Manchester City Council, the judges established that offers are good criteria are to be used to find out about contractual law formation5. Indeed, Foley v Classique Ltd Maugham held that there must be agreement on contractual terms, which are material before there is a binding agreement6. Moreover, Marshall communicated his share in contract formation and declared that his readiness of undertaking obligation upon certain conditions which had left the offeree an option of refusal or acceptance7. It is clear that Marshall offered 40 dollars for his materials, which was an offer that was capable of being converted into agreement through acceptance with definite promise of bound. Furthermore, it is negligence for buyers to commit themselves to the commodity purchase without inspection or provision of a better description of how it has to be8. The buyer did not read the disclaimer at the bottom of the email which says that the “Provider accepts no responsibility for defects in workmanship”. The use of this declaimer by Marshall reveals that there is probability that he is aware of poor workmanship as a result of his poor work and materials supplied—and that he did his actions intentionally knowing that his client will have no legal obligation to claim damages. If it established that the materials were not of the required quality or the work done was poor, Marshall will have to pay Joseph damages since Marshall has a critical role of being the guardian of client’s interests. In this case, despite the fact that he has a disclaimer that he is not responsible for workmanship problem, the court will find that he made errors for being negligent, which frustrated his client meaning that Joseph’s interests were not guarded. Again, the email did not provide explicitly the details about materials to be used such as texture and colour yet Joseph did not care. Moreover, both Edward and Marshall did not provide samples for an inspection opportunity nor did Clara and Joseph and Marshall use a known prescribed method to select materials. This can imply that there is a possibility that Marshall supplied low quality materials, which led to the collapsing of the wall. Accordingly, the courts may hold that Joseph was negligent and that he entered into a binding agreement without considering important details and that he will have to pay damages to Marshall and even Joseph. Tolaini Brothers (Hotels) Ltd v. Lord Denning in the Courtney & Fairbairn Ltd the judges claimed that courts have a responsibility to determine the availability of damages in breach of contract agreements since it is normally hard to explain whether a process of negation is going to succeed or the kind of results that are going to be gotten9. Furthermore, it is important to understand that Edward made an offer to the Clara and Joseph. There is an establishment of an offer because a price was agreed upon. The conduct of Edward reveals that he had an intention of making the email message binding since offers should always be communicated in writing or orally10, which happened between Edward and his client. Moreover, Edward will not have to claim that he was the one who send the email first and he was the one to be given an opportunity of repairing the house because the weather prevented the communication between him and the client until 16th February. Brinkibon Ltd V Stahag Stahl showed that where or when there is head-on communication, acceptance and it is considered that there was an offer11. This implies in communication, acceptance took place only when it was brought to the attention of the offerer who agrees to it12. In Pitt v PHH Asset Management Ltd13 and Walford v Miles, it was claimed by the judges that contracts of hostile lockouts could be enforceable legally if they did cover significant time engaged clear communication when they are made. The court might find it that there was agreement as Edward promised to repair the house, which he agreed and was ready to commence and correct the poor done work by Edward causing embarrassment to the customer forcing the termination of the contract. Edward will have to be given the contract by Joseph no matter the circumstance. In conclusion, and as discussed, it is clear that despite the fact that Marshall performed his work as agreed, the floor was flooded, a portion of room subsided and floor collapsed mostly likely because marshal left the room open to allow space for ventilation. A tool bag was placed at the drainage outlet and it seems it was the reason for the flooding problem. As a result, to Clara and joseph, this was frustrating to them. Joseph perceived the problem as personal incapacity and that Marshall miserably failed to take necessary precautions before leaving. However, because Marshall is willing to redo the work even at a reduced price, joseph is not willing to listen to him. Marshall can still perform the contract after an agreement out of court or the courts may instruct them to agree on how they can solve the issue. Moreover, the basic remedy for contract breach is normally damages award that protects the expectation interest of the claimant. Damages will have to be assessed with reference to the suffered loss. It seems that there was an act of acceptance on the part of Joseph and Clara and it appears that the important elements of the contract were applied. This is also because consideration has occurred since Marshall offered a proposal and joseph agreed in exchange for services of putting tiles in his house. The principle that must be used is that the parties to contract have to provide service, money, or any form of contribution to a contract14. Moreover, there was communication between Marshall and Joseph and Joseph and Edward where the pricing of the materials was brought to the attention of Joseph. Also, because the email is a reasonable and appropriate means of communication, the argument is a strong one and it can be claimed that once an acceptance is posted, the offeror has no duty of revoking it15. However, Marshall could be found with mistakes of negligence and personal responsibility that caused Joseph frustrations. Bibliography Books Doris M, 'Promising Options, Dead Ends And The Reform Of Australian Contract Law' (2013) 34 Legal Studies Eugene Clark and others, Contract Law In Australia (1st edn, Kluwer Law International 2013).K. L Fletcher and K. L Fletcher, The Law Of Partnership In Australia (1st edn, Lawbook Co 2007). Ewan McKendrick, Contract Law (Oxford University Press) (2007) Paul Richards, Law of Contract, 8th Edition, London: Pearson ( 2007). Cases Brinkibon Ltd v Stahag Stahl GmbH [1983] 2 AC 34 Courtney & Fairbairn Ltd v Tolaini Brothers (Hotels) Ltd [1975] 1 WLR 297 Foley v. ClassiqueCouches [1934] 2 KB 1, C.A.). Gibson v Manchester City Council - CA [1978] 1 WLR 520, Court Of Appeal. Pitt v PHH Asset Management Ltd [1994] 1 WLR 327 Read More