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1 Assignment: -Law of Commerce 2 Issues Whether the contract made between Alice and Preston is legally valid? Whether Alice has committed the off ...
1 Assignment:-LawofCommerce 2 Issues WhetherthecontractmadebetweenAliceandPrestonislegallyvalid? WhetherAlicehascommittedtheoffenseofmisrepresentationagainstPrestonPoshand PrestonPoshhastherighttodemandhismoneybackfromAlice? Rules LawofContract(CommonLaw)andtheprovisionsofmisrepresentationAct1967 Application Inthepresentcase,theissueinrelationtothevalidityofthecontractmadebetween AliceandPrestonPosharisesbecauseAlicebroughtanornatecheesesetfromLondonasthe sellertoldherthatitwasonceownedbytheEmperorFranzJosephoftheAstroHungarian Empire.AftercomingbackfromLondon,Aliceplacedanadvertisementforsellingofornate cheesesetinthelatesteditionofthenewsletterbystatingthatthisistherarechesssetas onceEmperorFranzJosephonceowneditandthesellingpriceofthispieceofhistorywas$ 3 25,000.So,whenPrestonPosh,awealthycollectorofsuchrarehistoricalpieces,sawthis offerinthenewsletter,hequicklycontactedAliceandarrangedtomeetAlice. Further,aftervisitingAlice,PrestonPoshinspectedthatparticularchesssetand purchasedthesamefromAliceagainsttheamountof$25,000.Accordingtothecommon law,certainelementsmustbefulfilledformakingthelawfulcontract,whichincludes,firstly, anoffershallbemadebyoneparty(RuleofLawInstituteofAustralia,2019).Thirdly. Secondly,suchoffershallbeacceptedbyanotherparty,oranotherpartyshallmakethe acceptanceinrelationtotheoffer,andsuchacceptancecanbemadeorally,inwriting,orby conduct(RuleofLawInstituteofAustralia,2019). Thirdly,bothpartiesmustintendtocreatealegalrelationshiptothecontract(Ruleof LawInstituteofAustralia,2019).Lastly,theremustbesomeconsiderationgivenbyone partytoanotherpartyinacceptanceoftheoffer(RuleofLawInstituteofAustralia,2019).In otherwords,aconsiderationmeansmakingpaymentorpaymentofsomekindinexchange forthepromisethattheyhavereceived.Asconsiderationplaysoneofthemostimportant rolesinmakingthecontractlegallyenforceable,thecontractisnotenforceablebylaw withoutconsideration. Ontheotherhand,theissueofeithertheactionsrepresentedatermor misrepresentationcanbeestablishedbyupholdingthefactsandverdictmadeinthecaseof OscarChessLtdVWilliams(OscarChessvWilliams,1957).Basedonthiscase,atermand misrepresentationinacontractaretwodifferentissues,andtheprovisionslaidunder MisrepresentationAct1967distinguishesthetwoterms.Accordingtotheprovisionsofthis Act,amisrepresentationisevidencedwhenthefollowingelementsareproved: 4 Whetherthemisrepresentationwasfraudulent Underthiselement,theclaimantmatrescindsthecontractwhenthemisrepresentation wasmadeunknowinglyorrecklesslyorwithoutabeliefinitstruth.Undersuchasituation, theplaintiffmayhavethecontractrescindedandseekdamages. Whetherthemisrepresentationwasnegligently Accordingtotherequirementsundersection2(1)oftheMisrepresentationAct1967, theclaimantmayseekrescissionordamagesifthemisrepresentationwasmadewiththe representedhavingsensiblegroundsforbelievingitstruth. Whetherthemisrepresentationwasdoneinnocently Underthissituation,themisrepresentationwasdone,butthedefendantcanshowthat theyhadsensiblegroundsinbelievingthattheirstatementwastrue;theplaintiffisnot entitledtodamagesbutisentitledtorescindthecontractandobtaindamagesinsteadof rescission.Aspertheprovisionsofsections.(2)oftheMisrepresentationAct1967,acourt mayawardrescissionofthedamagesincaseofnegligentorinnocent misrepresentation.(MisrepresentationAct1967,s.2(1))Alicehadnotruthabouttheproperty andthereforecommittedanegligentmisrepresentationbasedonthecasescenario.Onthe samenote,thereisasortofinnocentmisrepresentationbyAlice,andthereforebyupholding theprovisionsundersection2(2)oftheAct,AliceshouldpaybackmoneytoPreston (misrepresentationact1967,s.2(2)). Similarly,accordingtothegivenfactsofthepresent,alltheessentialsarefulfilledas firstly,theofferwasmadebyAlicethroughanadvertisementinthenewspaper.Secondly, PrestonPoshsawtheofferinthenewsletterhemetwithAliceafterinspectingthechessset. PrestonPoshacceptedtheofferorallyso,boththepartiesalsofulfilledthesecondelement 5 Thethirdelement,whichdealswiththeintentiontocreatealegalrelationship,isalso fulfilledasboththepartiesAliceandPrestonPosh,hadtheintentiontocreatealegal relationshipduetowhichAlicemadeanofferinrelationtothesellingofahistoricalpieceof chesssetandthesameofferwasacceptedbythePrestonPosh. TherewasafamouscaseinwhichtheHonblecourtheldthattherewasanabsenceof evidenceregardingthelegalrelationshipbetweenthepartiesbecausetherewasthevoluntary assumptionofthelegallyenforceableduty(Ermogenousv.GreekOrthodoxCommunity 2002).Inthepresentcase,accordingtothegivenfacts,theybothhavetheintentiontocreate alegalrelationship.Lastly,thefourthelement,whichrelatestotheconsiderationthatthe considerationmustbetheretomakethecontractlegallyenforceable,isalsofulfilledbecause accordingtothefactsofthepresentcase,PrestonPoshmadeapaymentof$25,000toAlice againstreceivingthattheparticularhistoricalpieceofthechessset. Therewasafamouscase,andthefactsofthecasewerethereweretwofriendsnamed TaylorandRobertswhomadetheplantotravelEuropebutlateronRobertsinformedthat sheneededtocancelthetripduetowhichtheybothincurredthecancellationchanges (YasmineTaylorv.CamilleRoberts,2018).So,inthiscase,thetwoissueswereraised beforethecourtthatwhetherRobertsbreachedthecontractornot.Secondly,payingthe depositforthepurposeoftheholidayshowsanintentiontocreatealegalrelationship (YasmineTaylorv.CamilleRoberts2018).Thecourtheldthat,firstly,therewasnocontract betweenthepartiesasitwasthechoiceofTaylortovisitwithRobertsornot,andtravelplans wereevolvingandfluidinnature. Secondly,Taylormakesthechangesinthetravelplanwithoutinformingthesame Roberts,whichshowsthattherewasanabsenceofintentiontoenterintothecontract,which wasbindinginnature.Therefore,Robertswasnotliabletopayanydamagesincurredinthe cancellationofthetravelplantoTaylor(YasmineTaylorv.CamilleRoberts,2018).Butin 6 thepresentcase,alltheessentialsofthecontractarefulfilled.Hence,thecontractmade betweenAliceandPrestonPoshislegallyvalidaswellasenforceablebylawandbindingin nature. Inthepresentcase,theissueinrelationtoAlicehascommittedtheoffenseof misrepresentationagainstPrestonPoshandPrestonPoshrighttodemandhismoneyback fromAlicebecauseafterpurchasingthehistoricalpieceofcheeseset,PrestonPoshhosteda grandeveningpartyandinvitedtheotherwell-knowncollectorsofthehistoricalpieces especially,thefellowantiquecollectornamedRooneyRabidforshowinghimlowashewas Prestonsbusinessrival.ButwhenPrestonPoshshowedtheFranzJosephchesssetto RooneyRabid,heloudlyproclaimedtoPrestonPoshbystatingthathaveyoucheckedit properly,thatsnotthechesssetofFranzJosephasheisthecurrentownerofthesameand alsohaveauthenticdocumentsasanevidencetoproveit. BywhichPrestonPoshfeltafit,andduetoriseinhisanger,hepickedupthechess setandthrownitagainstthewall,duetowhichthechessboardwasbroken,andthechess pieceswerebadlydamagedbeyondrepair.Although,asperthecommonlawPrestonPosh havetherighttogetbackhismoneyfromAliceifhereturnsthechesssetinthesame conditionwhichhepurchasedfromAlice,butasperthefactsofthepresentcasePreston Poshhaddamagedthechesssetbythrowingthesameagainstthewallinsuchawaysothatit willnotberepaired.However,inthepresentcase,Aliceisinnocentasshehadnointentionto misrepresentthefactsaboutthechessset,andasperthecommonlawforconstitutingthe offenseofmisrepresentation,itisnecessarythatthefourelementsmustbefulfilledthatis first,thestatementthatwasmadeismaterialmeansbywhichtheotherpartycandecide whethertoenterintothecontractornot(LegalServiceCommission,n.d.).Secondly,itmust beknowntotheclaimant(LegalServiceCommission,n.d.). 7 Thirdly,thestatementmustbemadetointendthatthedefendantwillactuponthe same,andlastly,thedefendantactuallyacteduponit(LegalServiceCommission,n.d.). Accordingtothegivenfactsofthepresentcase,thesecondelementwasnotfulfilledasthe statementmadebyAlicewhilesellingthechesssetthatEmperorFranzJosephonceowned thischesssetwasaneventnotknowtobothAliceandPrestonPoshthatitwasfalse information.Therefore,Aliceshallnotbeliableformisrepresentingtheinformationaboutthe cheeseset.Further,therewasarenownedcaseinwhichthecourtheldthatactivelyhidingthe defectinthegunwasconsideredamisrepresentation.Further,thecourtstatedthatinthis case,thebuyerhadnotinspectedthegun,duetowhichhewasnotawareofthe misrepresentation.Hencethebuyerdidnotinducebythesametoenterintothecontractwith theseller(Horsfallv.Thomas,1862). However,accordingtothegivenfactsofthepresentcase,beforeenteringintothe contractwithAlice,PrestonPoshinspectedthechesssetproperly.Hewasalsounawarethat EmperorFranzJosephonceownedthischessset.Evenafterknowingthis,heenteredintoan agreementwithAlice.Further,Alicehastherighttotakedefenseforherinnocenceasthe samestatementwasmadebythesellerinLondonfromwhomAlicepurchasedthecheeseset. So,hebelievedthatthestatementmadebythesellerwastrue,andfurther,shehadno intentiontodeceivethePrestonPosh.Therefore,PrestonPoshhasnorighttodemandhis moneybackfromAlice. Conclusion Afteranalyzingthepresentcase,itisconcludedthatthecontractbetweentheAlice andPrestonPoshislegallyvalidandenforceablebylawasalltheelementsoressentialsof thecontractincludeanoffer,acceptance,andcreationofalegalrelationshipand consideration,hasbeenfulfilled.Basedontheprovisionsofmisrepresentationact1967,itis 8 evidencedthatAlicecommitedamisrepresentationoffense.Inaccordancetosection2(2)of theact,alicecommitedainnoscentandnegligentmisrepresentationandthereforePrestonhas allthegroundstogethismoneybackfromAlice. 9 References Ermogenousv.GreekOrthodoxCommunity(2002)209CLR95. Horsfallv.Thomas,(1862)158ER813. LegalServiceCommission,n.d.Misrepresentation.LegalServiceCommissionofSouth Australia.Availableat:[Accessed 7October2021]. OscarChessvWilliams[1957]1W.L.R.370 RuleofLawInstituteofAustralia,2019.ContractLawinAustralia-2019.RuleofLaw InstituteofAustralia.Availableat:[Accessed7October2021]. section2(1)oftheMisrepresentationAct1967(1967).Australia. section2(2)oftheMisrepresentationAct1967(1967).Australia YasmineTaylorv.CamilleRoberts,(2018)NSWLC9.
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