BUSINESS AND CORPORATE LAW

Table of Contents

Question 1. 3

Question 2. 3

Question 3. 4

Question 4. 6

Question 5. 7

Question 6. 7

Reference list 9

Question 1

Issue

In this case, a manufacturer company failed to maintain their product liability and manufacturer’s liability, which provide issues and consequences to elder people. XYZ Company develops hipbone replacement, especially for older people. However, after two months people experience severe pain due to improper manufacturing devices.

Rule

Australian government has established a common law to protect consumers and customers. “Australian Consumer Law” (ACL) ensures protection and safety of consumers after purchasing or obtaining any product from suppliers. Section 138 under ACL ensures that a consumer can take action against a manufacturer if a consumer faces injury or damage after using a particular product[1].

Analysis

By following rights of consumers under Australian Consumer Law, law of tort can take action against hipbone replacement manufacturers. Law of tort can take action against suppliers by focusing on section 138 under ACL and section 259 under ACL. These sections ensure that manufacturers are liable if any consumer faces injury or severe issue after using a particular product[2]. In this case, elder people can take action against suppliers.

Conclusion

This case can be concluded that older people can take action against suppliers based on Australian consumer law. By focusing on section 138 and section 259, elder people take action.

Question 2

a) Issue

A barbershop promoted that they will provide a style haircut and shave for $12. Karl went to that shop for haircuts and shaves and sales representative stated that there was an error; the service will be $22.

Rule

Section 21 and 22 under Australian Consumer Law (ACL) state that a consumer and supplier have right to bargain and create an alternative price for any particular service[3]. Additionally, Australian Competition and Consumer Commission stated that a consumer does not require paying money to supplier increase of misleading conduct intentionally or unintentionally.

Analysis

Based on section 21 and 22 under ACL, Karl has right to bargain in that barbershop for receiving a haircut and shave for $12[4]. In addition, Karl may follow misleading and deceptive statements under Australian Contract law against that barbershop.

Conclusion

This situation can be concluded that Karl has right to claim a bargain from Berber shop based on Australian consumer law. Based on Australian Consumer law Karl has legal ground to claim service at $12.

b) Issue

Karl has noticed advertisement of a barbershop that they will provide haircuts and have only for $12. After receiving that service, Karl identified that barbershop charged $22 and they said that there was an error in advertising time.

Rule

According to Australian consumers, this is illegal for a business to mislead consumers by “false or misleading statement”. Additionally, this law mentioned that misleading consumer create fines against business regardless of whether that was made intentionally or unintentionally.

Analysis

By focusing on “False or misleading statements” under Australian Consumer Law, Karl does not have to pay money to a barbershop. Instead, Karl may fine the business by misleading him and confusing him by representing false advertisements.

Conclusion

This concludes that Karl may save himself from breach of contract by following Australian consumer law.

Question 3

Issue

Miguel has borrowed around $3000 from his neighbour Jono by telling him that he is 20 years old and Miguel states that he has a stable income. In loan agreement, Jono and Miguel have decided that Miguel will pay Jono in three equal fortnightly, however, after completing first payment Miguel stopped his payment to Jono. Now Jono is investigating Miguel and he wants to take legal action against Miguel. Here, Jono identifies that Miguel has hidden his original identity and age to Jono. 

Rule

According to the “Misrepresentation Act 1977”, an individual needs to provide penalties or transfer their property to other parties while they made misrepresentation during a contract[5]. Further, misrepresentation act 1977 states that if any misrepresentation is identified in contract, other parties may claim damage or charge to misrepresent party.

Analysis

In case of Miguel and Jono, Jono can follow Misrepresentation act 1977 to claim his damages and money to Miguel for presenting wrong age information. According to Misrepresentation act 1977, Jono may claim fines and an entire loan to Miguel. However, Criminal Code 1995 protects people under 18 years old from misrepresentation[6]. According to criminal Code 1995, Jono may fail to achieve success in tort for deceit against Miguel. However, current age of criminal liability is above 10. Section 5 under Children Act 1987 states that no child under 10 years old can be arrested[7]. Therefore, it indicates that an above 10-year-old child will choose a criminal offence. Further, section five (A) of this act stated that a child among 10 to 18 will have an issue of criminal offence dealt with by Children’s court. In this case, Jono may follow Children Court to complete this criminal offence of Miguel. On other hand, Australian Contract law states that if an individual conducts any breaches in contract, they have to provide penalties or fines to other parties. However, Youth Law Australia states that if an individual under 18 binds to a contract and is unable to complete or stopped to complete that contract, another party has ability to sue against a child under 18. Here, by focusing on Youth Law Australia, Jono can sue Miguel to stop paying loan and may claim charges in court.

Conclusion

Here, this case can be concluded that Jono may achieve success by following Youth Law Australia and Misrepresentation Act 1977 against Miguel and get back his entire money from Miguel.

Question 4

Issue

Charles has brought a Harley-Davidson motorbike from Kenny’s Motor Dealership and Charles knew that particular model was manufactured in 2008 and this bike only travels for 12,000 kilometres. After one month of using a motorbike, Charles needed to service that and he understood by repairperson that bike was manufactured in 2004 and it should capability to travel more than 12,000 kilometres. After investigating Charles has identified that, the motorbike was manufactured in 2004 and he paid $4000 more to Kenny's auto dealership from actual price of this model.

Rule

According to Australian Contract law, there are five specific categories to complete a contract between two parties. This law states that a non-breaching party may claim damages if a party faced a breach of contract. This law states that an individual can claim damage in two different ways such as "Equitable remedies” and “Damages and Liquidated claims"[8]. On other hand, Section 54 of Sales and good act 1923 state that a buyer if faced “Breach of Warranty” they may take action against the seller due to breach of warranty[9].

Analysis

Charles may follow Australian Contract law and remedies section under this law where he gets clear knowledge regarding breach of contract and his remedies from breach of contract. By focusing on Australian Contract law Charles may receive compensation money from seller. In Australian Contract, law damages are recognised as a substitute for performances. Here, Charles has faced performance issues in a Harley Davidson bike after one month of using it and he has identified that seller has, misleading him in context of price and performance of this bike. Therefore, Charles may claim compensation money to seller due to breach of contract and warranty. Additionally, Charlie may undertake section 54 of Sales and good act 1923 to claim damages to seller of Kenney’s motorbike dealership on ground of “Breach of warranty". Charles has faced a breach of a warranty in this regard to performance and service of a particular motorbike.

Conclusion

This case can be concluded that Charles may follow Sales and Good act 1923 and Australian contract law, whereby Charles may receive damages money from suppliers and address his motorbike issues significantly.

Question 5

Issue

Samantha wants to buy a brand of a unit in Kogarah after selling her unit in Oatley. She has plans to buy a new unit in Kogarah at a price of selling her old unit in Oatley. However, a unit of Oatley does not sell by expected date and Samantha has faced an issue buying her new unit in Kogarah.

Rule

According to Australian Contract law, a party may claim damages for another party to breach of contract[10]. In Australian Contract law, there are two types of remedies to address issue of breach of contract.

Analysis

In case, Samantha has faced issue and short-term finance while buying Kogarah unit due to a breach of contract from a buyer of Oatley unit. In this case, Samantha may claim or take action against the buyer of Oatley for breach of contract and her damages.

Conclusion

Therefore, Solicitor of Samantha guided her properly to address issue of buying a new unit in Kogarah.

Question 6

In this case, director of Octagon Supplements breach their general duties and create violations, which affect this company to achieve profit from an investment. According to Corporation act, 2001 duty of directors can be classified into two major groups such as general law duty and statutory duty. Section 180 under Corporation act 2001 covers general duties of directors[11]. In this section, a director needs to act in good faith and proper purpose while making decisions and being rational to implement decisions in business. These duties allow a director to continue a business smoothly without facing issues of loss in business. In case of Octagon Supplement, it has identified that this organization has faced an issue of profit after eight months of investment in another company. In this case, it can be stated that lack of care and diligence in business create this profit issues, Therefore, it can be stated that director of Octagon Supplement violated section 180 (1) under corporation act 2001 which create profit issue in this organisation.

Section 180 (2) has been introduced under corporation act 2001as defence of directors from their breaches of duty and any violation to an organisation. According to section 180(2), a director develops any particular decisions and judgement based on good faith and purpose[12]. Further, this law states that an executive does not make any decision due to their interest and purpose. Therefore, Section 180 (2) acts as a business judgement rule of directors, which act as a defence for executives from breach of duty. However, in context of validity, it has to be mentioned here that until now, no director can defend them from liability of duties based on section 180(2) under corporation act 2001. Therefore, it can be stated that directors of Octagon supplement have violated duties of directors under corporation act 2001, which create profit issue in this organisation. Additionally, there is a presence of defence to directors; however, those acts are not valid.

Reference list

Australian Consumer Law 2011 S. 138

Australian Consumer Law 2011 S. 21

Australian Consumer Law 2011 S. 22

Australian Consumer Law 2011 S. 259

Australian Contract law 2011

Children Act 1987

Corporation act 2001 (Cth) s. 180 (1)

Corporation act 2001 (Cth) s. 180(2)

Criminal Code 1995 (NSW) s.5

Misrepresentation Act 1977

Sales and good act 1923 s. 54