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MCD2070 Monash College 2011 Trimester 2 Assignment: Business Law Value: Due date: 10% of marks By 9.

.00 am Monday of Week 6 (25-07-2011) (1250 words)

ASSIGNMENT 1 (10 Marks)

Joe bought a caf in central Melbourne and wanted to serve excellent coffee to his customers. On September 1, he found the web site of a business that distributes coffee machines, Espresso Pty Ltd. Espresso Pty Ltd is managed by Sam in Sydney. He saw the ideal machine (the CF123) advertised for $15,000. On September 1, he sent a fax to Sam saying, I have seen your offer in your latest catalogue on your web site and I am pleased to accept. How do I pay? (Signed and dated). On September 4 Sammy faxed a reply, Thanks for your order. We are pleased to accept but regret to inform you that we have had to increase the price to $17,000 to cover cost increases. Price is payable by bank cheque on delivery. (Signed and dated). Joe immediately rang Sam to discuss the price increase. During their conversation, Sam said that there was only one CF123 left but, if he wanted to go ahead, he should know that the CF123 worked at its best only if premium-grade Brazilian coffee beans were used. Joe said that he wanted to check with his suppliers to ensure that he could get these beans in sufficient quantities. Give me a day or two to check things out, he said. Sam offered to hold the machine for him until Friday September 7 at 5.00pm. Agreed, said Joe. On September 5, Sam sent a letter to Joe telling him that he could not sell him the CF123 machine. The letter arrived at Joes place on the morning of 7 September On September 6 Joe found a regular supplier and immediately signed a one year exclusive-supply contract for premium-grade Brazilian coffee beans. He immediately faxed Sam, telling him that he had entered into a contract with a supplier for premiumgrade beans and wanted the machine as soon as possible. When he received the fax, Sam rang Joe and told him that he had already sold the machine to someone else. Sam explained that he had already sent Joe a letter to this effect. Required: Advise Joe whether he has a contract with Espresso Pty Ltd. Discuss the legal effect of each communication and consider what damages Joe may be entitled to. Assume the coffee beans can only be used in the CF 123 machines. (10 marks)

Assignment: Business Law

Value: Due date:

20% of marks By 9.00 am Monday of Week 9 (22-08-2011) (1250 words)

Assignment Two

(a) Mathew bought a house in inner Melbourne and hired Big Moves Pty Ltd, a company that transports goods within Victoria, for an agreed price of $4,000. During the negotiations, Mathew expressed some concerns to Chris, the manager of Big Moves Pty Ltd. He mentioned that, amongst the packed items to be transported, his antique porcelain vase is extremely fragile and should be handled with care. Mathew signed a contract with Big Moves Pty Ltd without reading its terms. Clause 7 of the contract stated: Any liability for damages arising out of any obligations performed under this contract, howsoever caused, is excluded. While loading the items onto the transport truck, Dan, one of the movers, left Mathews goods unattended for five minutes while he had a cigarette break. During this time, Mathews 42-inch LCD television was stolen. Mathews also later discovered that his antique vase was broken due to careless handling of the goods by the movers. Required: Advise Mathew of whether he can successfully sue Big Moves Pty Ltd for breach of contract for the loss of his television and damage to his vase. In your answer, consider the effect, both at common law and under statute. (12 marks) (b) Big Moves Pty Ltd is also in the business of selling second hand electrical goods. Chris sold a refrigerator to Mathew for $1,200. Before the refrigerator was sold to Mathew, he was told by Chris that it was a brand new refrigerator. Mathew later found out that the refrigerator does not work very well, and is two years old. Mathew now wants to return the refrigerator. Required: Advise Mathew of his contractual rights to return the refrigerator. Consider both express terms and implied terms in your answer. (8 marks) (12 + 8 = 20 marks)