LAW6000: Law - Legal Issue Arising From the Facts of The Case Study Assessment Answer

Internal Code: D_BJ_DFDG_BFC Code: LAW6000

Law Assessment Answer

Assignment Task: LAW6000 1. This assessment addresses the following subject learning outcomes: 2. Describe the essential elements required to create, manage and discharge a contract and the remedies available for breach of contract. 3. Explain the different ways in which a business may be carried and the advantages and disadvantages of each method. Instructions: There are five case studies you are required to critically analyse. LAW6000 With respect to each case study: ? Identify the legal issue(s) arising from the facts of the case study ? Identify the appropriate legal rules that require discussion in the case study ? Apply the law to the facts of the case study ? Reach a conclusion/ give practical advice to your client. Question 1 - LAW6000 Jeff owns a business which makes and sells a well-known brand of peach brandy (“the Business”). Jeff holds a business name, and a trademark for a logo, associated with the Business’s brand of peach brandy. The Business sources fruit from local producers. The Business is operated on land which is also owned by Jeff. Jeff decides it is time to sell the Business and is introduced to Tina who is interested in buying the Business. Jeff and Tina enter into negotiations and agree on a deal. Both Jeff and Tina sign the following document which Jeff prepared. Part A - LAW6000 You are Tina’s solicitor. Using the IRAC legal problem-solving process give your conclusion on whether Tina is legally bound to buy the Business as a result of signing the Heads of Agreement. Part B - LAW6000 What would be your conclusion if Tina had included in the Heads of Agreement a term stating: Question 2 - LAW6000 Phil is managing director of LightsBright Pty Ltd. Phil has accepted a large order for electrical fittings from CheepCheep Pty Ltd on behalf of LightsBright. The order has been delivered to CheepCheep as per the agreed terms, however, CheepCheep has not paid their $75 000 invoices. CheepCheep is in serious financial difficulty and this was well known or suspected across the industry. Consequently, at the time the order was made, CheepCheep was known generally as a bad credit risk in the industry. Phil was aware of this, however, he is a good friend of Robert, the managing director of CheepCheep. Phil decided to provide the order in any event. CheepCheep has now been placed into liquidation and has still not paid the debt owed to LightsBright Pty Ltd. Question 3 - LAW6000 Francis collects music-related merchandise, in particular, she is a big fan of Kiss (American glam rock band) and Status Quo (English boogie band) merchandise. Francis appoints Rick as her agent and instructs him to purchase three specific Kiss related items from Allan, another collector of Kiss merchandise. Francis gives Rick a limit of $25,000 to spend, which Rick promptly deposits in his own personal bank account to “keep it safe” until it is needed. Francis also instructs Rick to keep the purchase of the three items confidential. Rick is very pleased about his appointment as Francis’s agent and tells three of his closest friends on the proviso the friends do not share any information with anyone. However, two of these friends work in the music industry and immediately tell their employers. Rick approaches Allan and introduces himself as Francis’s agent. Following negotiations, it is agreed Allan will sell the three Kiss items to Francis for $32,000. When Francis is informed of the contract, Francis flatly refuses to pay and says: Part A  Using the IRAC legal problem-solving process give your conclusion on whether: (a) Allan can enforce the contract for the three Kiss items with Francis. (b) Francis is bound to go ahead with the contract to purchase the Status Quo albums from Allan, and the consequences for Rick if Francis is not bound to the purchase. Part B  Describe the ways in which Rick is in breach of his common-law duties as an agent, and any consequences of such breaches. Question 4 - LAW6000 Prue, a famous model, is the spokesmodel for the cosmetics firm Slapiton Ltd. Prue is also ambitious to become a screen actor. Prue is required to attend a public event at the Bilton Hotel as part of her contract and so she orders and buys a new gown made by the famous designer, Rueter, from a trendy boutique called Gladrags. Prue did not try the gown on prior to purchase as there was not one in her size available, and so the gown was quickly made and delivered shortly before it was time for her to leave for her event. To Prue’s horror, about an hour after dressing in her new gown and arriving at the Bilton Hotel, she is in great pain. An extremely painful red rash of large boils has erupted all parts of her in contact with the gown and she has a sudden extreme fever. Consequently, Prue is unable to complete her appearance. In addition, as she tries to leave the stage she becomes dizzy and falls of the stage and breaks her leg. Prue is rushed to a hospital. After removing the gown made by RuPeter and receiving medical treatment in hospital for a period of six weeks, the boils reduce, but sadly they leave permanent ugly scarring on her body. Prue is no longer able to work as a model, representing a loss of income of at least $10million. In addition, Prue had been about to negotiate a movie deal with a major movie studio worth $5million. The movie studio no longer wishes to commence negotiations. Laboratory tests upon the gown reveal the fabric contained residue of a toxic chemical used in an associated manufacturing process. This chemical is supposed to be removed by a washing process before the gowns are released, however, due to the rush nature of the order, this was not done before the gown was shipped to Prue. This chemical reacted with Prue’s skin causing the violent condition. This toxic chemical could not be detected by normal visual inspection. The hospital bills total $15 000.

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