Question 1

Alvin runs a business selling expensive cars. Last Monday he mistakenly placed a notice on one car indicating that the car was for sale for $5,000 when in fact its real price was $25,000. Bert later noticed the sign and recognizing what a bargain it was. He immediately indicated to Alvin that he accepted the offer and that he would take the car for the indicated amount. Alvin however told Bert that there had been a mistake and that the true price of the car was $25,000. Bert insisted that he was entitled to get the car at the lower price, and when Alvin would not give it to him at that price Bert said that he would sue Alvin. Bert then left.

After Bert had left, Alvin changed the price of the car to $25,000 and then Cat came in and said that she would like to buy the car but that she would have to arrange finance.

Two days later Del came by and offered Alvin $25,000 cash for the car there and then. Alvin sold the car to Del.


Advise the following;

(a) Does Bert have an action against Alvin for breach of contract?

(b) Does Cat have an action against Alvin for breach of contract?

(c) Does Del legally own the car?

Question 2

Farmer Bob goes to the market to auction his calf. On the morning of the sale, before the commencement of the proceedings, Farmer Joe is examining the calf when Farmer Bob comes up to him and says “I had her examined by the vet last week and he says there’s nothing wrong with her, She is as sound as a bell.” Farmer Joe stops his examination and in due course purchases the calf at the auction. A term in the auction conditions of sale reads:

“No warranty is given as to the quality of any animal”

It is true that the vet last week pronounced the calf in good health. Unfortunately the vet was wrong as the calf has tuberculosis and dies a week after the sale.

Does Farmer Joe have a remedy for breach of contract?

Question 3

Perfect Homes Estates Pty Lted requires a replica model of an exclusive housing estates to be built on the western fringe of Sydney. They enter an agreement with Sam, an expert model maker, for the construction of the model at a price of $100,000.00. A deposit of 10% is paid on entering the contract, the balance payable on completion in two months.

Just before the completion date a ‘freak storm’ completely destroys Sam’s office building and the model. Perfect Homes Estate Pty Ltd is claiming the contract is no longer in existence and are claiming a refund of the deposit.

Advise Perfect Homes Estate Pty Ltd of their rights and obligations, including whether they are entitled to have the deposit refunded. Refer to any relevant cases.

Part II: Question

Obtain a copy of a written contract that is available in Australia from the net or another source. For example you could download one of the many online contracts you are asked to agree to before accessing a site or entering an online contract.

Provide the following information;

(i)Select a term in the contract that is written in complicated legal language. Highlight at least three words or phrases that you don’t understand, research their meaning and provide a definition for each one. Please include an example if you think that will help.

(ii) Proved a plain English ‘translation’ of the term you chose in (i) above or another term. The words you use should be clear to most English speaking adults. Feel free to make significant changes to the structure or wording and to use everyday language.

(iii)Print out and highlight six terms. You then must classify each term as either a condition or warranty using case law. You must include a brief explanation about why you think each one can be classified in this way.





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