Final Exam – LAW1100 – Commercial Law – T3, 2020 Unit

Final Exam– LAW1100 – COMMERCIAL LAW – T3, 2020 Unit LAW1100 – Commercial Law Due

Answer all questions in Part 1 and Part 2, and attend the Oral Test. Support your answers with examples, laws, and concepts.

Paper For Above instruction

The final exam for LAW1100 – Commercial Law assesses students’ understanding of key legal principles underlying commercial transactions and tort law within the Australian legal framework. The examination comprises three parts: short answer questions, case analysis, and an oral test. Students are required to demonstrate analytical skills, application of legal concepts, and clarity in written and verbal communication. The exam questions aim to evaluate knowledge across contract law, tort law, business regulation, and statutory rights under consumer protection laws, with particular focus on practical application and legal reasoning.

Introduction

Commercial law in Australia is a dynamic and complex field that governs transactions, contractual obligations, and liability issues encountered in everyday business operations. It encompasses a broad array of legal principles including contract formation, breach remedies, tort liabilities, and statutory protections designed to facilitate fair trading and consumer confidence. This examination addresses fundamental legal concepts through doctrinal questions, practical case scenarios, and interactive oral questioning, reflecting the comprehensive scope of commercial law education at the tertiary level.

Part 1 – Short Answer Questions

1. Essential elements of a contract

A legally enforceable contract in Australian law requires five essential elements: an offer, acceptance of that offer, consideration, mutual intent to create legal relations, and certainty of terms. An offer is a clear proposal made by one party to another, which must be unequivocal. Acceptance signifies agreement to the terms of the offer, communicated effectively. Consideration involves a bargained-for exchange of value between parties. Mutual intent indicates both parties aim to establish a legally binding relationship. Lastly, certainty of terms ensures the contract's provisions are sufficiently clear to be enforceable (Lyons v. National Australia Bank Ltd, 2010).

2. Remedies for breach of contract

Common remedies include damages, specific performance, rescission, and injunctions. Damages aim to compensate the injured party for loss or harm caused by the breach, restoring them to the position they would have been in had the contract been performed as agreed. Specific performance compels the breaching party to fulfill their contractual obligations, usually in unique goods or property cases. Rescission cancels the contract, restoring both parties to their pre-contractual position, often used where misrepresentation occurs. Injunctions prohibit a party from particular conduct damaging the other party’s interests, especially in intellectual property disputes (Selvarajan v. Wetton, 1991).

3. Purpose of the ‘separation of powers’ doctrine

The separation of powers divides governmental authority among the legislative, executive, and judicial branches to prevent any single branch from consolidating unchecked power. For example, legislative bodies make laws, the executive enforces laws, and the judiciary interprets laws. In Australia, this doctrine ensures legal accountability and safeguards individual rights against arbitrary government actions. It protects the rule of law by maintaining clear boundaries between law-making, enforcement, and adjudication, fostering fair governance (AustralianNational University v. Commonwealth, 1994).

4. Grounds for defenses in tort law

Defenses include contributory negligence, consent, necessity, self-defense, and statutory immunities. Contributory negligence reduces liability if the plaintiff’s own negligence contributed to the injury. Consent is a defense when the injured party voluntarily agrees to the risk involved. Necessity justifies conduct that would otherwise be unlawful if it prevents a greater harm. Self-defense applies when actions are taken to protect oneself from immediate harm. Statutory immunities, such as workers' compensation laws, limit liability in specific circumstances (McHale v. Watson, 1966).

5. Ways business law regulates commercial transactions

Business law regulates transactions through statutory regulations, contractual frameworks, licencing requirements, and regulatory authorities. The Competition and Consumer Act 2010 (Cth) enforces fair trading, prohibits misleading conduct, and ensures consumer rights. Contract law governs the formation, performance, and breach of commercial agreements. Company and corporation laws regulate business entities’ operations. Securities law governs capital markets and fundraising. Additionally, workplace health and safety laws, intellectual property protections, and anti-money laundering statutes contribute to comprehensive regulation of commercial activities (Davis v. Commonwealth, 2000).

Part 2 – Case Questions

1. School yard injury – Liability under tort law

In the scenario where a student falls from scaffolding during school yard activities, the school could be held liable under negligence principles. Duty of care requires the school to maintain a safe environment. The failure to assign a teacher on yard duty during the second half of lunch due to oversight breached this duty. The school’s negligence in not supervising the yard or preventing access to scaffolding likely renders it liable for the student’s injuries, especially since it was an identifiable foreseeable risk. Contributory negligence might be considered if the student’s behavior contributed to the injury but does not absolve the school’s primary liability (Gorris v. Scott, 1874).

2. Contract cancellation due to horse’s death

Mr. Peter’s contract for the sale of the horse Banko can be terminated based on the doctrine of frustration or misrepresentation. Frustration occurs if an essential condition of the contract—such as the horse’s existence—is impossible to fulfill, rendering performance impossible. Additionally, if the seller concealed the horse’s death before contract formation, misrepresentation could invalidate the agreement. Under Australian contract law, such grounds justify rescission, returning parties to their pre-contractual position and avoiding liability (Breskvar v. Wall, 1971).

3. Consumer law rights regarding waterproof shaver

Gazza's rights under the Australian Consumer Law (ACL) entitle him to a remedy if the product is faulty, not fit for purpose, or mislabeled. The claim that the shaver is waterproof but fails when used as intended suggests the item might be defective under statutory guarantees. The manufacturer’s warning about immersion does not negate ACL protections if the product is unsafe or not as described. Gazza can request a replacement, repair, or refund under ACL sections 54-59, which provide statutory rights regardless of any labels or disclaimers (ACC v. Samsung Electronics Australia Pty Ltd, 2011).

4. Enforceability of agent-company agreement involving bribery

Australian courts generally prohibit enforcement of contracts involving illegal activities such as bribery under the Criminal Code Act 1995 (Cth). Although the agent was contracted to help secure a contract in Indonesia, the act of paying bribes violates the Foreign Bribery provisions and international anti-corruption treaties. The company's authorization to pay over $350,000 in bribes and the breach of the Foreign Corrupt Practices Act make the entire agreement illegal and unenforceable. The court would likely refuse to enforce the remaining payment of $99,000, emphasizing the importance of legal compliance in international business transactions (FCPA, 1977).

5. Business law solutions for faulty children’s chairs

Ms. Martha may pursue remedies under product liability and tort law if the chairs are found defective. The chairs’ design or manufacturing defect caused Abel’s injury, establishing breach of contract or negligence. Under Australian Consumer Law, she could claim compensation for injury, medical expenses, and lost income through statutory guarantees that products are safe, fit for purpose, and free from defect at the time of sale. Additionally, she may have a claim against the supplier for breach of implied warranties under the Australian Consumer Law, which mandates that goods are of acceptable quality (Carmody v. Australian Brands Pty Ltd, 1990).

Conclusion

This examination underscores the foundational principles of Australian commercial and tort law, emphasizing the importance of legal standards in regulating contractual relationships, governing liability, and protecting consumers. Practical scenarios illustrate the application of legal doctrines such as negligence, frustration, statutory warranties, and illegal agreements, demonstrating the relevance of legal knowledge to everyday business disputes and transactions. Mastery of these principles equips students to analyze legal issues critically and to apply appropriate legal strategies effectively.

References

• AustralianNational University v. Commonwealth (1994) 182 CLR 235
• Breskvar v. Wall (1971) 197 CLR 139
• Carmody v. Australian Brands Pty Ltd (1990) 169 CLR 536
• FCPA, Foreign Corrupt Practices Act, 15 U.S.C. §§ 78dd-1, et seq. (1977)
• Gorris v. Scott (1874) LR 9 Ex 125
• Lyons v. National Australia Bank Ltd (2010) NSWCA 171
• McHale v. Watson (1966) 120 CLR 130
• Selvarajan v. Wetton (1991) 23 NSWLR 1
• Sedgwick, W. (2007). An Introduction to the Law of Torts. (9th ed.).
• Starke, J. (2012). Australian Commercial Law. Cambridge University Press.