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LAWS20058 Australian Commercial Law For Hart Analysis

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Questions:

Part A

Using the resources of Module 1 and Workshop 1 in Week1 your tribe developed a constitution. A few years later a group of 20 families from a nearby area who speak your language join your tribe and do not know the rules of the tribe. Explain how you would introduce and enforce the rules of the constitution for the benefit of this new group and your tribe. Be sure to refer to Hart’s analysis of legal rules in the answer.

Part B

“If a legal system in Australia under which people and businesses operate and live is to be effective and have widespread acceptance a number of key features should be present.” What features of the Australian legal system could be relevant here. Use requirements for Hart’s 3 part legal system as a starting point. Apply examples from the Australian legal system to support the analysis.

Part C

In this part, your task is to research an Australian case relating to the common law part of the essential element topic of genuine consent and report to your supervising partner (your boss!) on the significance of the case to the Australian law of contract. The contracts’ topics can assist, particularly areas of Week 6 resources. 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 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:

1. Identify the common law legal issues in dispute. What were the broad areas of contract law that are relevant here?
2. Explain the principles of law, the rules that the court applied and which were relevant to deciding the issue.
3. Apply the relevant law to the facts. Explain how the court applied the relevant law.

Part D

Ram is an Australian businessman who owns three coal mines in northern Queensland. He has a 10 year contract with Betty to supply her 400 tonnes of coal on or before the 20th day of each month of the contract. Betty uses the coal in her steelworks. The contract started in 2014 and has proceeded smoothly. However on 31 July this year Ram realises that because of heavy rains in the past two weeks all of Ram’s mines are flooded and he will not be able to supply Betty the contracted amount of coal from August to December 2017.
He communicates the bad news to Betty on 31 July. In fact he will not have any coal to supply to Betty until
January 2018 and he advises her of this.
Advise Betty using the IRAC method what choices she has. Is she entitled to terminate the contract? What do
you think she would do in these circumstances? Be sure to comment on possible remedies. You do not need to
discuss the formation of a contract topic here. Assume that a valid enforceable contract exists between the
parties.
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

Answers:


Introduce and enforce the rules of the constitution with Hart analysis:

Developing the rules is the need for the functioning of the daily life in a tribe there are various kinds of persons present in a tribe. The rules and regulations are introduced for the benefits of all the members present in the tribe although there are certain decisions which are favoring the majority having powers in hand. According to Hart’s law is moral responsibility in the absence any legal system. The new tribe that is joining the developed constitution is needed to be understood with the already followed rules from past years[1]. It is also required to make them understand the importance of the decisions taken by the head of the tribe is mandatory to be followed without any argument in case of any dispute or implementation of new decisions. It is also said that there is no relation between the morality and law due to which the enforceability of a law is depends upon the internal and external factors[2]. The internal factors are the interior thoughts of a particular person about following the rules as mandatorily following the implicated regulations on his own. In the absence of such morality there are chance of disobey the law which will results to problems in the tribe. It is also suggested that no law is applicable or followed until lots majority of the population is not following the law[3]. On the other side external part is following the law habitually. So it is required to make them understand the importance of the law its implication and how the developed constitution will help them to sustain in the long run. The understanding about the law will result to following the established tribal law which is followed by the tribe form past years.

Part B

Features of the Australian legal system under which under which people and businesses operates and lives:

A legal system refers to a procedure of creating and implementing of laws for and individual and entity. This procedure imitates the way on how organizations, government and people behavior in accordance with the execution of laws. In this concern, the Hart’s 3 part legal system demonstrates these laws as a union of primary and secondary rules and regulations. In other words, the Harts legal system divided these laws in two types of rules i.e. primary rules and secondary rules[4]. Hart’s legal system presents that there is a normative feature of legal rules and regulations that are reflected in the obligations suffered by an individual to follow. This legal system is analyzed to make distinction between primary and secondary laws. The primary rules generate duties and obligations and duties with requirement of certain actions for an individual. The existence of primary rules may form an obligation for an individual to behave in certain way with in the internal perspective of Australian legislative system. On the other hand, secondary rules are set up of different procedures through which the primary rules can be commence, enforced and modified. On the basis of secondary rules three types of problems can be treated in order to rules of recognition, change and adjudication.

Furthermore, it is analyzed that the Australian legal system is considered as one of the humanity’s common law of legal system. In Australia, the common law tradition is a derivative for local customs, which is developed, shaped and applied equivalently within the court[5]. Due to appropriateness for citizens and business this legal system is also observed across different countries such as Canada, New Zealand, USA, India and Malaysia. Australia’s legal system is expected to put a widespread intelligence outlook in negotiation of any argument. Additionally, the technical rules in Australian legal system have been developed for judges to sort out the nature and type of information that may be used as an evidence to protect the entity.

Australian Law Reform Commission, 1999, depicted that an adversarial system also refers to common law system that is used in several legal proceeding and the parties are provided responsibilities of investing and defining the legal issues. This Reform Commission is implied to draw solutions for both defendant and plaintiff in court in a systematic way. On the other hand, the term ‘inquisitorial’ is referred to civil code system through which the fundamental responsibilities related to the investigation issues or legal proceeding system[6]. This term implies the distinctive characteristic of Australia’s Legal System as an adversarial arrangement. Though, Australian Law Reform Commission, 1999 has been stated that there are confirmations that demonstrate the Australia evaluation system and proceedings have been espoused and customized some of its adversarial traits with some barrowed civil code system of Australia.

It is analyzed that the law making power are divided between Commonwealth parliament and State Parliament. In Australian legal system, there are some areas such as taxation power, where both of the Commonwealth parliament and State Parliament have power to make rules and regulations[7]. In addition, the parliament of the nation is considered as heart of the Australia’s National Government, which prepared flexible and suitable legal rules and regulations for people and businesses. In this regard, the important functions of Australian parliament are as below:

  • To grant for the legal formation of a government
  • To grant the funds required for government
  • To make legal rules based on common and statutory laws
  • To grant an opportunity for admired demonstration
  • To scrutinize the accomplishment of government

On the basis of above parliament functions it is analyzed that the legal system is favorable and effective for the businesses and people that live in the country. As well as, it is analyzed that the Australian legal system is based on rational laws and ideological circumstances. 

Part C

In this part, Barton v Armstrong (1976) case is taken to understand the common law, which is an essential topic of genuine consent. As well as, this case will be helpful in understanding Australian law of contract in effective manner. The issues and results of this case are discussed as below:

Issue: In case of Barton v Armstrong (1976), Barton is the managing director of an organization developing various projects in the field of real estate. The main project of the Barton’s company is going through Paradise Water Pty Ltd. The other party to the contract was state Politician named Alexandra Armstrong. In this project, Barton prepared a legal document in which the company settled to pay $140,000 to state politician Armstrong for his shares of $180,000. Barton made the legal document as threaten of murder from Armstrong[8]. Armstrong sued in NSW Court for legal proceedings and to get a fair legal decision.

Rule: The genuine consent or free consent of Australia refers that a contract should have essentials of a valid acceptance, offer, consideration and legal intention of making agreement. The agreement made between the parties must include the genuine consent to validate the contract. If, a contract made through pressure, misconduct, fear and unfairness than the contract will not be enforceable by law[9]. It is also known as contract made under undue influence which is void at the beginning. Moreover, if a contract include misrepresentation, undue influence, duress and fraud than there will not be a free consent and unenforceable by law. So in case it is proved that the contract made between the parties is under threat/pressure than it is termed as void.

Application: In case of Barton v Armstrong (1976), the NSW court depicted that all the elements of the contract were present in the case but when the reason for the contract was revealed in the court than it resulted to a case having absence of free consent. In this case, duress is found because the legitimacy of the pressure used by Barton threatened to murder if the contract was not made in favor of the politician, which is presenting threat to do something wrong or unlawful. So Armstrong who was threatened of murder by Barton to sign on the legal document has made the contract favoring the politician[10]. Therefore, it is analyzed that Barton used unlawful activity because Armstrong does not have any intention to sell his shares at the price mentioned in the agreement made for selling the shares to Barton. In other words, there was not free consent between Barton and Armstrong, so the contract is unenforceable by law due to absence of the free consent which is an essential element for enforceability of a contract.

On the basis of above case study and its analysis on basis of legal formation the court will give decision on evidence of facts. The evidences provided by Armstrong will be beneficial for the court to take appropriate legal decisions. The court said that the Barton applied duress in the contract therefore it is not a valid contract and also has lack of genuine consent therefore Armstrong has legal authority to get remuneration from Barton. It is also suggested that the contract is void at the starting so the ownership of the shares are needed to be given back to Barton and Armstrong is needed to be imprisoned as per the legal system applicable for such crime. 

Part D

Issue: The problem is the failure to fulfill the requirements of the contracts due to natural calamities. The contract was made between Ram having coal mines and Betty having steelwork, requires coal as fuel. Contract was made for a period of 10 years to supply material on a specified date which is 20th day of each month. In the their third year of the contract Ram, supplier of the coal come to know that due to heavy rains it is not possible to supply coal for next 5 months from August to December 2017. In addition to this Ram also admitted his failure to supply coal for next year also. This happened due to heavy rains for two weeks which resulted to flooding of the mines with water, so the coal mine is to be closed. As per the contract law it is obligation of the party to the contract to supply goods as decided by the parties at the time of the contract[11]. Failure to fulfilling the conditions will result to breach of the contract. And the party fails to fulfill the conditions of the agreement can be sued for the compensation by the other party. So Betty is having option to breach the contract.

Rule: As per the contract law, the parties to the contract are having legal obligation to fulfill all the conditions of the contract, failure to fulfill any of the condition will results to breach of the contract. The breach of the contract is of three types’ material breach, partial breach and total breach. There are slight differences between the various breaches of the contract but happening of any one kind such activity is enough for the termination of the contract[12]. So the party which fails to fulfill the requirements of the contract is liable for the compensation to the other.

Application: As per the information provided in the case above it is observed that Ram is responsible for the breach of the contract. According to contract it is required to supply coal for a period of ten years every month before 20th day of every month but due to floods in the area of operation there were lots of water filled in the mines[13]. As per the results of the case Vincent v Lake Erie Transportation Co (1910), 109 Minn 456, 124 NW 221 it is suggested that the contract is discharged on the ground due to natural calamities which is not in the control of any of the parties to the contract so the plaintiff is not allowed to have any kind of compensation for the loss caused due to breach of the contract[14]. But in the case of Ram and Betty, Ram is responsible for the supplying coal after the mines are ready to take out coal and then Ram will continue to supply coal to Betty.

Conclusion and Remedies:

As per the information available in the case study it is observed that the case of Ram and Betty is influenced by Act of God due to which Ram is not able to fulfill the contract conditions. Ram also informed Betty well in advance about the problem he is facing so that Betty can arrange alternative solution for the same. In case of any other reason for the breach of the contract Betty is having options to continue the contract and ask for the compensation of the losses from Ram. The second option with Betty was to terminate the contract and ask for compensation for the loss caused due to failure of supply of the goods. But in this case the only option remains with Betty is to continue the contract and take goods after the period is over and the mines are ready to explore coal. Ram is also free from the any kind of obligation to pay off monetary or any other compensation to Betty by communication of the problem with in the stipulated time.  

References

Anson,et al., Anson's law of contract. (Oxford University Press, 2010).

Ferrick, Brandon. "Defending a Benefit-Based Approach to Compensation for Necessary Losses." (Stance: An International Undergraduate Philosophy Journal 8, 2015): pp.39-45.

Finnis, John. Natural law and natural rights. (Oxford University Press, 2011).

Harris, Rachel, and Katharine Gelber. "Defining De Facto Slavery in Australia: Ownership, Consent and the Defence of Freedom (2011) 11." Int'l Crim. L. Rev. 561.

Harris, Rachel, and Katharine Gelber. "Defining De Facto Slavery in Australia: Ownership, Consent and the Defence of Freedom (2011) 11." Int'l Crim. L. Rev. 561.

Hart, Herbert Lionel Adolphus, and Leslie Green. The concept of law. (Oxford University Press, 2012).

Hart, Herbert Lionel Adolphus, and Leslie Green. The concept of law. (Oxford University Press, 2012).

Herring, Jonathan. Vulnerable adults and the law (Oxford University Press, 2016).

Loughlin, Martin, and Samuel Tschorne. Public law. (Routledge, 2016).

McKendrick, Ewan. Contract law: text, cases, and materials. (Oxford University Press (UK), 2014).

McKendrick, Ewan. Force Majeure and frustration of contract. (CRC Press, 2013).

Millbank, Jenni. "The new surrogacy parentage laws in Australia: Cautious regulation or 25 brick walls (2011) 35(1) ." Melb. UL Rev. 165.

Renzaho, A. M. N., McCabe, M., & Sainsbury, W. J. Parenting, role reversals and the preservation of cultural values among Arabic speaking migrant families in Melbourne, Australia (2011) 35(4). International Journal of Intercultural Relations, 416-424.

Woellner et al, Australian Taxation Law Select: legislation and commentary (CCH Australia, 2011). 

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