The Principles of Law - Assignment Example

Assignment two attachment form When submitting your assignment it must be accompanied by this Assignment Attachment Form. Please make sure that you complete all of the details correctly. Provide all details requested on this form. Use one form for each assignment. Given name Chi Chun Surname CHOY Student number 15944313 Email rex_1129@yahoo.com.hk Unit name Business Law 1100 Assignment title Assessment Two – Four Step Process and Short Answer Date submitted 6 Sep 2012 Student’s comment to tutor N/G Marker’s comments Recorded mark Marker Comments Part A – Four step process Question 1 Identify the principle or issue of law The legal issue whether the element of agreement required for the formation of a contract can be established. Explain the rule(s) of law There are three elements that parties wishing to enter into a contract must fulfil in order to have a valid contract, which are: an offer by one of the parties (offeree) and an acceptance by the other party (offeror) expressing their intention to be legally bound; and considerations by both parties and a mutual agreement.Thus, a contract is only fulfilled when it is evident that both parties have satisfied all the three conditions. The law defines an agreement as a consensus by the parties entering the contract on the three conditions that set the environment for a transaction. Australian law expresses that the presence of an offer ultimately shows that the offeror is ready to accept and be bound by his/her offer without further consultation by the offeree. Anoffer is effective as soon as it is announced and anyone who accepts the offer before it is withdrawn is automatically liable to it. The offeree may choose not to express his/her acceptance of the offer,in which case the acceptance is implied by actions and conduct. An offer must be complete, promissory and contractual in nature, in case the offeree accepts it. An agreement is invalid if the following conditions prevail: If, at the point of acceptance, an offeree makes additional conditions, unknown to and unintended by the offeror. If, at the time of acceptance, the offer has expired because the time in which it was active has passed. The offer was founded on an exigency that no longer exists.The offeror becomes deceased and the offeree is aware of this fact. Puffs, opinions and representations do not make part of a contract, whereas a term makes part of the contract In Brinkibon LTD v Sthalwharenhandelsgesellschaft [1983]1allER293, Brinkibon accepted to purchase products from Sthalwharenhandelsgesellschaft and sent their duly acceptance note by telex to Vienna, thus forming a contract. In the issue of where the contract was formed, the court ruled that the contract ensued when the telex reached Vienna because that is where the company had defined as its database reception centre. In the case of Van Den Esschert v Chappell [1960]WAR 114, the court establishes that the two parties had both written and non-written (verbal) contract, and are bound by both. In this case, before signing the contract, the buyer inquired of the seller as to whether the property in question had been damaged or contained white ants. The buyer was firmly assured that the property in question had been recently treated for white ants and as such, did not have white ants. The court ruled that since the buyer had clearly inquired before signing the contract, the subsequent answer was essential to the buyer’s final decision, thus making the answer a term for the contract, even though it was not part of the written contract In the case of Associated Newspaper Ltd V Bancks[1951]83 CLR 82, Bancks sued the Associated Newspaper ltd (accused) for breach of contract because the accused had published Banck’s drawings in the third page of the newspaper’s comic section, instead of on the first page three times. Subsequently, Bancks withdrew from drawing for the Newspaper and signed a contract with another party before the end of the 10 year contract. The AN ltd sought court order to prevent Bancks from rescission and the issue was whether the rescission was active. The court established that to Bancks, getting his work printed on the front page was very important, without which he could clearly terminate the contract. However, since the Newspaper had printed Banck’s work in a different page three times, it had breached the contract between them and Bancks and he could therefore consider the contract discharged. Apply the law to the fact In the case between Steven and Julia, Julia makes an offer to sell a mirror and comb for a negotiable price of $250, which is a complete offer. Steven opens discussions with Juliaand they agree that Steven can pay $200 for the goods, to which Steven says that he will think about it, thus there is consensus. Julia says that the offer is open until 10 am the next day and the two parties exchange contacts where Julia gives Steven her business card. At 10pm that evening Steve leaves a message for Julia on her phone to the effect that he will pay the $200 the next day in the afternoon and pick the goods, which is an acceptance. The message is delivered into Julia’s voice mail instantaneously, and in this case, the postal acceptance rule may apply. Although the contract clarified that the deal expires by 10 am the next day, the exchange of phone contacts gave the gesture that the two could still communicate in the near future. The fact that Julia gives Steven her contact card also shows that she is expected him to confirm whether he would come back for the offer or reject it before the set deadline of 10am. When Julia sold the same goods that she had agreed to sell to Steven, she breached their contract of agreement. Draw possible conclusions Since it is established that the message reached Nicole’s voice mail, the element of agreement required for the formation of a contract can be established and a legally enforceable contract was formed between the two parties. Therefore, Nicole has to sell the special offer to Steven. List of Cases Referred to Brinkibon LTD v Sthalwharenhandelsgesellschaft [1983]1allER293 Van Den Esschert v Chappell [1960]WAR 114 Associated Newspaper Ltd V Bancks [1951]83 CLR 82 List of other sources Lambiris, M. 2012 First Principles of Business Law. Sydney: CCH Australia Question 2 Identify the principle or issue of law The principle of law is what terms are expressly agreed in relation to the restringing of Annette’s racquets and whether Paul’s Racquet Restringing can rely on the exclusion clause in the contract. Explain the rule(s) of law When making contracts, there are two categories of phrases, those that form part of a contract, and those that do not. Contracts are formed by terms and conditions and warranties, but puffs, representations, statements and opinions may just be used by the parties involved to make the deal sound better. Conditions define the terms of agreement which are very important for the contract, and without which a contract cannot be made, whereas warranties are less important and only define claims for damages in case there is breach of contract. In addition, warranties and conditions are called personal terms because they legally bind two people and cannot be assessed by a third party. The two parties involved in a contract can agree to the terms and conditions are either by mouth or written document, or implied by facts and common law. Exclusion clauses are conditions under which a contract will not be honoured and they form part of the contract in some cases. They have to be clear and precise, without any ambiguity. In cases where exclusion clauses are ambiguous, the judge may rule in favour of the person to whom the clause was intended. In Bettini v Gye (1876) 1 QBD 183,Mr Frederick Gye agreed with Bettini that Bettini would perform for him between March and July and would not sing elsewhere within London for a period of 11 months. A condition of the contract stated that Bettini would have to report back to London six days prior to his preparations for the concert. However, Bettini reported back to London 2 days to the concert and claimed that he was prepared to sing in the concert, at which point Gye declined. The issue is whether the provision of arriving at city six days prior to rehearsals was a condition which would lead to termination of the contract. The ruling judge established that the provision was not a condition since there were no express terms Stating that in case of forfeiture to arrive six days in advance, the singer would lose the contract, or a sum of his salary would be deducted or any other predefined consequence. Moreover, this absence during the rehearsals could not adversely affect the singer’s capability and thus, was not a breach that went to the root of the contract. In Causer v Browne (1952) VLR 1, Causer took his wife’s dress to be washed by Browne’s dry cleaners and was given a ticket with which he could come and pick the cloth later. However, on the back of the ticket, there was a clause of exclusion in which the dry cleaners denied liabilities in case of damages to the cloth during processing. The clothes were damaged and Causer refused to pay for the services after complaining about the damages and was sued. The court declared that plaintiff could not use the ticket as record for written exceptional clause as it was only a receipt for reclaiming possession of an item, thus the court ruled against the plaintiff. Apply the law to the facts In the case between Annette v Paul’s Racquet Restringing, Annette is a champion and sees an internet ad which says that Paul’s Racquet Restringing are the best in Melbourne and no one can string racquets like them, and that they use first grade materials for restringing Racquets for champions. Following this ad, she visits Paul’s shop and explains that she is a champion and wants her racquets repaired professionally. She makes it very clear that the repairer must use the correct tension materials otherwise she will lose the championships, of which she is assured that her racquets will be repaired using highest grade materials. After paying for the repairs, she is given a docket for collecting the racquets and fails to notice the disclaimer which rejects liability for negligent workmanship caused by the workers. Here, the terms that are expressly agreed in relation to restringing of Annette’s racquets are that Annette pays $180 and in return, her racquets will be restrung correctly with the highest grade materials. Paul’s Raquet Restringing cannot rely on the exclusion clause in the contract because the docket is only used as a means of identification when the customer comes to reclaim her possessions. In addition, Paul did not take any measures to make Annette aware of the exclusion clause in the back of the counter or at the back of the docket. It is conceivable that Annette could have withdrawn from the contract if she was aware that her dockets would not be restrung using correct tension and materials this directly affected her performance in the championships. However, Annette can claim for damages because she was assured of correct restringing with the highest quality material and Paul had the capacity to determine correct materials, which he did not do. Draw possible conclusions The provision that the racquets must be restrung using the correct material is a warranty because it is not complete and the parties do not put a claim of what will be paid in case of a forfeiture. Therefore, Paul must take responsibility of any losses that arise from the contract and pay for the damages claimed Annette. List of Cases Referred to Bettini v Gye (1876) 1 QBD 183 Causer v Browne (1952) VLR 1 List of other sources Lambiris, M. 2012 First Principles of Business Law. Sydney: CCH Australia Part B– Short answer question The Australian Judiciary has a Hierarchical court system that is divided into two categories, namely: state stream and federal stream. The two courts are separate in jurisprudence, but are both under the High Court of Australia, which is the highest in hierarchy. A judge in the court has powers to preside over new cases and a judge in a higher court has powers to preside over both new cases and appellate cases. In Australian court system, each state has its own hierarchy of courts from the Supreme Court to the district court and the local court. The local court has the lowest jurisdiction and the Supreme Court has the highest jurisdiction. The Supreme Court can hear cases of appeal from the two lower level cases and make new rulings throughout the state of territory. However, if there is a matter that is of interest to more than one state, the Supreme Court has no jurisdiction, therefore, cannot make any ruling. Hence, if I was the judge in the District court of Western Australia, and faced with a decision that conflicts between two supreme courts, I can only follow a decision from the high court, or else refer the case to a higher court in the hierarchy. Read More