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LAWS20058 Australian Commercial Law

LAWS20058 – AUSTRALIAN COMMERCIAL LAW – ASSESSMENT 1 – INDIVIDUAL ASSIGNMENT

Complete all parts.

Marks: 40% of the overall assessment for the course

Format: One file in .doc or .docx (MSWord) format. Submissions in any other file format (e.g. .zip) will be treated as a non-submission.

Your file should contain:

Cover sheet – Contains your name, student number and word counts for Parts A, B, C, D and E.

Word limit: Word limits are set out below for each part.

Extensions policy:

The university policy on extensions of time will be strictly enforced. Extensions will only be considered if made via the online system and must be based on medical or compassionate grounds. Any extension application should be made before the due date for submission. Medical conditions should be supported by a medical certificate, and, since students are expected to start the assignment early, temporary or lastminute conditions are usually not grounds for an extension. Professionals are expected to manage their time to meet their obligations, so work or personal commitments are insufficient grounds for an extension. Time management is important to avoid any late submission. A two mark per day late penalty may apply without an approved extension.

Plagiarism:

The university’s plagiarism policy will also be strictly enforced. If plagiarism is found, a minimum penalty is likely to be zero marks for the assessment. It could be worse.

You must cite and reference the resources consulted in the assignment responses. By citing and referencing the material consulted you will also be acting in an ethical and honest manner. Acknowledgement may be in the form of in text citations, footnotes and/or a bibliography. See the Moodle resources on Plagiarism. Be sure to access the ALC for assistance with referencing.

PART A (5 marks- 300 words)

In using the resources of the early Modules, your tribe discussed and developed a constitution. In the new constitution assume that there are rules protecting a member of the tribe from violent acts from another member of the tribe. Explain what rules protecting members of the tribe from such acts of violence were developed and why they were developed in the tribe’s constitution. Be sure to refer to Hart’s analysis of legal rules in the answer. There are additional resources on Moodle in the early Modules of the course to assist.

PART B (5 marks- 300 words)

Research Question

“A crime is an act or conduct which is prejudicial to the community. It renders the guilty person liable to punishment.” Research a legal system of a foreign country and explain what penalties can be imposed by a court once a person is found guilty of a criminal offence. Then compare them to the range of penalties available to Australian courts in criminal cases. Be sure to refer to Hart’s analysis of legal rules and use the requirements for Hart’s 3 part legal system in the answer. There are additional resources on Moodle to assist in the early Modules of the course. Support your analysis with case and statute references where relevant.

PART C (10 marks- 600 words)

In this part, your task is to research the Australian case, Gumland Property Holdings Pty ltd. V Duffy Bros Fruit Market ( Campbelltown) Pty Ltd (2008) 234 CLR 237 and report to your supervising partner (your boss!) on the significance of the case to business clients and the Australian law of contract. Initially Chapter 11 of the text can assist.

Please note that additional resources should and can be accessed in alternative textbooks on Business Law, Contracts’ Law or Commercial Law. The resources mentioned at the end of Chapters 1 and 2 of the Turner text may assist as could websites such as www.austlii.edu.au. Your answer should mention other cases in the analysis of the set case.

The report should use the IRAC method as a structure- Issue, Rule, Application, Conclusion and remedies. This structure requires you to set out clearly and in an organised way these matters arising from the court’s decision:

  • Identify the common law legal issues in dispute. What were the broad areas of contract law that are relevant here?
  • Explain the principles of law, the rules that the court applied and which were relevant to deciding the issue.
  • Apply the relevant law to the facts. Explain how the court applied the relevant law.
  • Conclusion and remedies- after the above stages how did the court reach a conclusion on the facts of the problem. Be sure to consider the remedy or remedies for the successful party.

PART D (10 marks- 600 words)

In this part, your task is to select and research an Australian case relating to when a party to a contract may ask a court to cancel the contract due to fraudulent misrepresentation and report to your supervising partner (your boss!) on the significance of the case to the Australian law of contract. In the analysis you should discuss the issue of fraudulent misrepresentation both at common law and under consumer legislation. Parts of the text chapters on Consent of Parties (Chapter 7) and Consumer Protection (Chapter 17) can assist.

Contract law requires that parties enter agreements freely and voluntarily. Your choice must be an Australian case referred to in either the textbook or the Class Notes. Please note that some cases in the Class Notes are not in the textbook may be found in alternative textbooks on Business Law, Contracts’ Law or Commercial Law. The resources at the end of Chapters 1 and 2 of the Turner text may assist as could websites such as www.austlii.edu.au Your assignment must include a full reference for the case.

In the text at pages lxxxv-lxxxvi, there is a Table of Abbreviations. In the table you will find brief details of

Australian courts and legal case reports eg CLR, FCA, FCAFC and HCA; and state and territory reports eg NSWLR, NSWSC, QCA, QSC, VSC and VSCA.

The report should use the IRAC method as a structure- Issue, Rule, Application, Conclusion and remedies. This structure requires you to set out clearly and in an organised way these matters arising from the court’s decision:

  • Identify the common law legal issues in dispute. What were the broad areas of contract law that are relevant here?
  • Explain the principles of law, the rules that the court applied and which were relevant to deciding the issue.
  • Apply the relevant law to the facts. Explain how the court applied the relevant law.
  • Conclusion and remedies- after the above stages how did the court reach a conclusion on the facts of the problem. Be sure to consider the remedy or remedies for the successful party.

Support your analysis with case and statute references where relevant.

PART E (10 marks- 600 words)

Please note. In this question and answer you should consider only common law contract issues as set out in the Modules and text Chapters 9, 10, 11 and 12. Do not apply consumer law or other statute principles in your answer.

Pedro and Lisa were both retailers selling imported French jewellery in Melbourne, Victoria. Lisa sold her business to Pedro and in the contract agreed that she would not carry on or be engaged in the sale of imported French jewellery anywhere in Australia for a period of two years. One year after selling the business Lisa established a new retail business in Cairns, Queensland, selling imported French jewellery. Can Pedro enforce the contractual promise against Lisa?

Advise Pedro using common law contract legal principles and the IRAC method as to what action Pedro can take and the possible remedies he could obtain. You do not need to discuss the essential elements and the formation of a contract topic here. Assume that a valid enforceable contract exists between the parties. Do not apply consumer law or other statute principles in your answer.

It is essential that you refer to relevant cases to support the analysis.

The IRAC method- Issue, Rule, Application, Conclusion and remedies- requires you to set out clearly and in an organised way these matters:

  • Identify the common law legal issues in dispute. What are the broad areas of contract law that are relevant here?
  • Explain the principles of law, the rules, that apply and which are relevant to deciding the issue.
  • Apply the relevant law to the facts. You may need to consider more than one approach here. There is not always one clear way.
  • Conclusion and remedies- after the above stages reach a conclusion on the facts of the problem. Be sure to consider possible remedies for the innocent party.

Support your analysis with case and statute references where relevant.

Solution

LAW OF ASSIGNMENT

Part A

Explanation of the tribal rules

In an empirical tone, the tribal rules of Australian resonate with the notion of Ideal law, in terms of Hart’s legal analysis. Legal researchers have debated that whether the tribal rules deserve to be designated as laws since one of the fundamental features of these rules bear semblance with the customary law. As customary laws, which are mostly based upon treatises, customs and apprehensions of previous case studies, the tribal rules are mostly non-codified which have endowed the legal scholars with the scepticism regarding the capability of tribal laws to be transformed into a legal authority (Singh et al. 2017). One of the additional traits of tribal law is that it is not universal as it is susceptible to vary in accordance with the intensive principles and ethos of a respective tribal community. Furthermore, as it was mostly non-codified, the rules (rather customs) are chiefly propagated in a word of mouth fashion, from generation to generation. Another cardinal trait of the tribal rules of Australia is that the verdicts regarding non-compliance to the customs or committing any offence are mandate specific, which resonates with the sentiments of alternate Dispute Resolution (ADR) such as negotiation, arbitration, mediation etc.

In terms of Hart’s framework of legal analysis which scholars have conceived mostly as a counter statement of Austin’s framework (law as command), the tribal rules resonates with the notion of primary law due to the tribal rules being non-codified and its verdicts being mandate specific in nature (Christen, 2015). Though the law reform commission of Australia and Western Australia have acknowledged the legal enforceability of tribal rules, it has been seen that the tribal rules are mostly what has been designated as natural or organic law prevalent in the world. However, the tribal laws, though being non-codified and mandate specific, have shown adequate jurisprudence which ensures the presence of requisite legal authority to punish the delinquents who have shown non-compliance regarding the ethos of the community.

Part B

Explaining penalties of a crime; analysis of a legal system

As a statement of justification, the criminal statutes and the corresponding penal wraths of USA can be illustrated since it owns several significant and distinct features as compared to the legal system of Australia. In this regard, it is interesting to note that, The US constitution is the supreme legal authority, which is supposed to govern the federal legal authorities of the country around several states of USA.

Before the evolution of criminal law, both in states and federal level of USA, the act of executing the penal columns and sentencing the offender of legal statutes happen to take place in the local courts (Kennedy, 2018). In this regard, the most distinct feature that the US state and federal criminal court has been able to show is that juries have exhibited trifle engagement regarding the verdicts of normal cases. However, in cases of deat6h sentencing only, they have been consulted regarding the permission or exploring the possibilities of death penalties. This feature unveils a significant aspect regarding the synergy of the state and federal level criminal statutes where states happen to dominate the criminal laws across the several federal legislative quarters.

In terms of the legal analysis of Hart, in the criminal statute of USA, the juries have, mainly done the role of recognition. However, they can also be considered as the exponents to respond to the role of adjudication in cases of legal or death penalties.

Comparative assessment with Australian legal system

The rudimentary aspect of Australian legal system is that it is based upon structured and codified legislative columns, which bears a stark difference from the criminal statutes of USA. In an empirical tone, it can be said that the legal framework of Australia is structurally different from that of USAs (Simons, 2018). In terms of the legal analysis of Hart, the major difference between Australian and USAs criminal law is framed upon the notion of role of adjudication. For instance, the juries in the Australian statute appear to play the most crucial role in terms of proposing ant verdict whereas, in USA, the juries have been consulted only when it is a matter of death sentence.

Part C

Gumland Property Holdings Pty ltd. V Duffy Bros Fruit Market (Campbeltown) Pty Ltd (2008)

Issue

The governing issues of this specific lawsuit are as follows;

  1. Gumland Property Holdings have forwarded a notice to Duffy Bros concerning the claim of the payment of a shortfall amount prior to the sub-lease agreement which legal bind Gumland and Duffy Bros. Is the notice legitimate?
  2. Apart from that, the Gumland Property has also claimed for bargain damages prior to reinstatement and refurbishment. Is it legitimate for an owner to claim bargain damages from their sub-tenants?
  3. Apart from these claims of financial remuneration, Gumland have also appealed to Duffy Bros to terminate the sub-lease contract within 29th March 2008. Is it legitimate to encourage a company to terminate lease contracts due the incapability of the company to pay sub-lease amount.

Rule

It is evident from the issues of the current case that the legal enquiry is supposed to be framed upon the legitimacy of the landowner’s urge to retrieve their losses prior to the inability of the sub-tenant to pay the lease amount and the damages due to bargaining (Sherry, 2016). If we go through the stairs of the current lawsuit between Gumland Property and Duffy Bros, it has been seen that the Duffy Bros have attempted to get rid of their liability of paying the bargain damages. Thus, the ultimate pursuit of the legal enquiry have transformed into an inquiry of finding that whether all the claims forwarded by Gumland Property is legitimate or not.

In terms of an apparent perspective, it is evident that Duffy Bros have unable to pay the arrear rents, which they are legally obliged to pay as per the sub-lease agreement they have with Gumland Property. In this regard, Gumland Property has proposed the claim that Duffy Bros are also liable to pay the bargain damages prior to the expenditure of reinstatement and refurbishment (Collins, 2016). Furthermore, after hovering around the nuances of the case, it is also evident that Duffy Bros is also obliged to pay the pending amount prevalent between the arrear rent and the outgoing. Furthermore, the appeal of terminating the sub-lease agreement is based upon a condition in order to propose Duffy Bros a time constraint within which the entity is supposed to pay the shortfall amount along the damages prior to bargain and expenditure associated with refurbishment and reimbursement.

In this regard, Duffy Bros have been discovered to refer to the notorious case of Shevil V Builders (1982) in order to get rid of their liability to pay the amount prior to bargain damages. However, after the intervention of the Australian Capital Territory (ACT), the claim of Gumland Property happens to be established which also suggests that Duffy Bros is legally obliged to pay the bargain damages along with the shortfall of the sublease amount.

Application

Legal analysis of this case concerning the breach of sub-lease agreement seem to suggest that any violation of such agreements must hold the defendant responsible all the damages and expenditure prior to reinstatement and refurbishment along with the shortfall amount. However, the attempt of Duffy Bros to defend this blatant violation of contract agreement (by refusing to pay the damage amount) is based upon the verdicts of Gibbs CJ. However, after the active intervention of the tenancy tribunal and capital territory of Australia, it holds Duffy Bros liable to pay the shortfall of sub-lease agreement.

Conclusion

The current case can be considered an exemplary one in terms of getting the attitude of Australian Capital Territory (ACT) and tenancy tribunal regarding the violation of any principles of sub-lease agreement. The study suggests that though the sub-tenants are not legally obliged to pay the interest of the outstanding rent, the defendant entities are legally obliged to pay the financial assistance prior to reinstatement and reimbursement. Furthermore, in case of any shortfall of the sub-lease payment, the owner is adequate to decide the termination of the lease contract.

Part D

Misinterpretation of a contract; An Australian Case

Misinterpretation or misrepresentation of the terms or principles of a legal contract are a fraudulent aspect where the defendant attempts to wind a particular contract by the means of the statement or pledges regarding the legal statute that the exponents of the contract are bound with. There are relevant legal columns in every common law statute, which has been hold liable to prevent these deceiving statements in the courtroom premises and these statutes have been congregated under the Misrepresentation act 1967 (Irakli, 2017). Australia, being a common law statute has also ensured the enforceability of the respective act and that ahs been known as Alati V Kruger (1955).

Facts

  1. In the course of convincing the plaintiff, the defendant have made several misleading statement while selling the business of fruit selling to the plaintiff
  2. The plaintiff have realized that the business is not that profitable and shows the interest to rescind the contract
  3. When confronted to the plaintiff, the legal constraints of the law statute happen to suggest that the parties are not been able to restore their previous positions

Issue

What are the possibilities of the contract to be rescinded since the parties are not been able to retrieve their previous position?

Rule

In the case of approaching the case with jurisprudence, rescission is the only option that might help the parties to retrieve their previous positions while evading the possibilities of misrepresentation. Australia, being a common law country, does not entertain the appeal regarding the rescission of the underlying contract. In this regard, the plaintiff is legally constrained to accuse the defendant regarding the violation of warranty or pass comments which are fraudulent (Hawkins, 2017). Furthermore, it is evident that there lies an evident quotient of untrue statement, which enables the case to resonate with Wilkinson V Bisset. Apart from that, the notion of misrepresentation in common law statutes has been further amended to Contract Terms Act 1977. Furthermore, the plaintiff can be also recommended to execute the Consumers Rights Act 2015 in order to consolidate the malicious intent present in the mindset of the defendant. This is imperative since the common law statutes have been seen to categorize the notion of misrepresentation into two distinct categories and those are Innocent and Fraudulent respectively. Thus, the plaintiff is legally obliged to establish that the defendant have sold the business to the plaintiff while having the awareness that the business is not that productive.

Application

In accordance with the nuances of the current case, it is evident that it is potentially impossible for both of the parties of the contract to retrieve their primordial position since the appeal associated with rescinding the contract is not available in any common law statute. Furthermore, being a common law country, Australia is unable to entertain any pleadings regarding the scope of introducing the rescission of the underlying agreement. In this regard, the plaintiff can be recommended to avail the option of equity since it will provide a substantial remuneration against the incurred losses.

Conclusion

It is evident from the case study that, the verdicts have been introduced the notion of misrepresentation that leads the entire thing towards fraudulent admission. Furthermore, the study also has been able to identify a governing trait of the common law statutes, which is legally impotent to entertain any pleas regarding the rescinding of a particular contract. Thus, the plaintiff has been recommended to avail equity, which sustains.

Part E

Facts

  1. Pedro and Lisa are supposed to be joint retailers of French Jewellery in Victoria, Australia for a significant time. Thus, it can be assumed that a legally binding contract is existing between two of them.
  2. Lisa decided to leave the business by selling the complete entity to Pedro. In this regard, as part of the amendment of the contract prevalent between them, Lisa has been obliged to proclaim that she will not been able to construct any business with identical products (i.e. French Jewellery) in any Australian premises for next 2 years.
  3. However, Pedro invented Lisa selling French Jewelleries in Queensland (Cairns)

Issue

  1. Is this attitude of Lisa can be considered as a deliberate violation of contract prevalent between her and Pedro?
  2. What are the statutes and associated legal columns, which can be exercised to offer legal suggestions to Pedro?
  3. What Pedro can do to prevent Pedro from making deceiving statements in court in the course of defending her attitude?

Rule

In the light of Contract Act, 1872 of Australia, those who approach the case is inevitable to perceive it as a blatant violation of the contract prevalent between Lisa and Pedro. In this regard, a little consideration followed by a legal analysis will suggest that the nuances of the current case will resonate with the case known as Marcy’s V Martha Stewart Living as the dimension of punitive damages is evident in the case (Campbell, 2015). In order to consolidate the claim of violation of the contract prevalent between Lisa and Pedro, Section 23 (a) of the Contract Law 1872 will be beneficial since it will help Pedro to establish the deliberate violation of the contract. However, several legal scholars on the current regard have suggested that the Trade Practices Act 1974 (which has been later named as Australian Consumer Law; ACL) also appears relevant in the course of preventing Lisa from making any false or deceiving statement in the courtroom premises.

Application

It is evident from the case study that the dimension of punitive damages is inescapable which make the current case resemble with the famous case Prince Rogers Nelson V Perfume & Cosmetics Inc. However, in terms of differences, it has been seen that the notion of punitive damage happens to be founded upon mostly the consideration of exhibiting a malicious intent from the defendant’s side (Anderson, 2015). In the current case, there has been no malicious intent shown by Lisa, which will endow Pedro with the difficulty to establish the notion of punitive damages in the courtroom premises. However, the breach of promise that has been exhibited by Lisa can be categorized under the quotient of minor betrayal, in adherence with the case known as Marcy’s V Martha Stewart Living.

In terms of executing the legal advices, Pedro can be suggested to ask for a financial injunction, which might assist both Lisa and Pedro to establish the case in the courtroom. In the course of establishing the claim of financial injunction, Pedro can be recommended to bring the amended contract of the case with him.

Conclusion

It is of no doubt that the Trade practices act 1974, which has been later known as Australian Consumer Law, happens to be enforceable in this course. However, Pedro can be encouraged to deploy the legal requirements of ACL, which might be able to prevent Lisa from making any deceiving or misleading statement in the courtroom premises. However, Pedro can be recommended to resolve the internal issues by the means of Alternative Dispute Resolution (ADR).

Reference List

Singh, M., Wrangham, R. and Glowacki, L., 2017. Self-interest and the design of rules. Human Nature, 28(4), pp.457-480.

Christen, K., 2015. Tribal archives, traditional knowledge, and local contexts: Why the “s” matters.

Kennedy, C., 2018. Gordon's Criminal Law, Volume II. Edinburgh L. Rev., 22, p.168.

Simons, K.W., 2018. Can Strict Criminal Liability for Responsible Corporate Officers be Justified by the Duty to Use Extraordinary Care?. Criminal Law and Philosophy, 12(3), pp.439-454.

Sherry, C., 2016. Strata Title Property Rights: Private governance of multi-owned properties. Routledge.

Collins, T.L., 2016. The doctrine of frustration, commercial leases and the Canterbury earthquakes.

Irakli, T., 2017. The Principle of Freedom of Contract, Pre-Contractual Obligations Legal Review English, EU and US Law. European Scientific Journal, ESJ, 13(4).

Hawkins, D., 2017. Failure to State a Claim Fraudulent Misrepresentation. Wisconsin Law Journal.

Campbell, D., 2015. Better than F uller: A Two Interests Model of Remedies for Breach of Contract. The Modern Law Review, 78(2), pp.296-323.

Anderson, R.R., 2015. The Compensatory Disgorgement Alternative to Restatement Third's New Remedy for Breach of Contract. SMUL Rev., 68, p.953.

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