LAWS8218 Advanced Contracts

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LAWS8218 Advanced Contracts

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LAWS8218 Advanced Contracts

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Course Code: LAWS8218
University: Australian National University

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Country: Australia

Questions:
1.Is the fact that Weitao did not read the term render the term inapplicable?
 
2.Is the contract between Warren and Evelyn complete and capable of being enforced?
 
3.Are Evelyn’s words terms of the contract enforceable against her?
 
4.Is provision of the laptop charger an implied term in the contract between Evelyn and Jake?
Answers:

1.
Issue
Is the fact that Weitao did not read the term render the term inapplicable?
Rule
A person is bound by a term in a written contract provided the term was provided in the contract irrespective of whether the person read the contract or not when he signed the contract, L’Estrange v Gaucob. The common law principle in L’Estrange is applicable in Australia and was applied in determination of Peekay Intermark ltd and another v Australia and New Zealand Banking Group Ltd and Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd. In Toll (FGCT) Pty Ltd the contract directed an agent to read the term of the contract overleaf. However, he ignored and just signed the contract. The contract and the terms were found to be binding irrespective of whether the terms were read on not. The only circumstance a person can escape the application of a signed contract is where there are vitiating factors such fraud and misrepresentation.
It is not a requirement that the terms of a written contract must be brought to the attention of the signing party in order to be binding. However, where the terms of a written contract are provided in some other place or document other than the one being signed, the party’s attention must be adequately brought to the existence of such terms. Otherwise they will be held not to be apply.
Application
Waitao signed the contract without reading the note. The fact that he signed the contract but failed to read the note in the contract is immaterial based on the holding in L’Estrange and Toll (FGCT) Pty Ltd. The signature was an assent to be bound. There is no fraud or claim of misrepresentation that is likely to vitiate the contract.
Conclusion
The fact that Waitao did not read the note is immaterial. Waitao is, therefore, bound by the term on the note.
2.
Issue
Is the contract between Warren and Evelyn complete and capable of being enforced?
Rule
The essentials of an enforceable contract include, among others, its completeness. A party cannot enforce an incomplete contract. However, this will depend on whether the term which has not been agreed on is essential to the contract or not. In Harvey v Pratt a lease contract was held to be unenforceable due to incompleteness. The lease did not provide the commencement date. In Anaconda Nickel v Tarmoola Australia Pty Ltdit was stated that the parties’ intention determine whether a particular term is essential or not. In Harvey parties agreed on everything including the price to be paid, however, commencement was not provided. The court found the commencement time to be essential. In this case scenario the day when the painting is to be done is essential to the contract because it determines the parties’ rights under the contract for breach.
Application
Warren and Evelyn entered into a contract and agreed on other terms such as how long the painting will take. However, they did not agree on when the painting was to be done and they have not been able to agree on that for quite some time. Despite Warren’s attempts to have the time set or agreed on Evelyn has been non-committal. Time of painting is essential to the performance of the contract and for determination of parties’ liabilities. Based on the holdings in Harvey and Anaconda Nickel the contract is incomplete and therefore unenforceable.
Conclusion
Warren is wrong as the contract is incomplete and unenforceable. There are no benefits under the contract, under the circumstances.
3.
Issue
Are Evelyn’s words terms of the contract enforceable against her?
Rule
The determination whether a statement made before formation of a contract is a term depends on the importance of the representation to the parties and the knowledge and skill between the parties. The determination whether a pre-contract representation was a term of the contract was made Bannerman v Whitewhere a buyer of hops relied on the assurance of the seller that the hops were not treated with sulphur but some were indeed treated with sulphur. The statement was determined to be a term of the contract due to its importance to the buyer. It was the court’s determination that the parties would have entered into the contract if there was no assurance that the hops are not treated with sulphur. The assurance was therefore important.
Where the a person has got more knowledge than a third party and the third party can be reasonably said to have relied on that person’s skill and knowledge the assurance of such a person is a term as was held in Dick Bentley Productions Ltd v Harold Smith and Oscar Chess Ltd v Williams. A car dealer was held to have more knowledge and skill than the buyer that the statement he made before the formation of the contract was held to be a term.
Application
Ambreena needed a tablet to complete a project while travelling. The storage space was therefore important and as such assurance that the tablet has a particular memory space is a term. This is in accordance with Bannerman case where importance of a representation made it a term of a contract. Also, Evelyn deals in tablets and is therefore has more skills and knowledge than Ambreena in matters pertaining to tablets and as such the assurance that the particular tablet was perfect for Ambreena’s use and had particular memory space was a term of the contract based on the court’s holding in Dick Bentley Productions Ltd and Oscar Chess Ltd. In those cases a term was determined that where a party relies on the skills and knowledge of another that person’s assurance is a term of contract. It can reasonable be said that Ambreena relied on Evelyn’s assurance to enter the contract.
Conclusion
Evelyn’s representation to the effect that the tablet has more space was a term of the contract.
4.
Issue
Is provision of the laptop charger an implied term in the contract between Evelyn and Jake?
Rule
The court in Codelfa Construction Pty Ltd v State Rail Authority of NSWestablished five considerations for a term to be implied into a contract. These include the term not being inconsistent with already existing terms of the contract, the term being necessary, the term being obvious, the term being fair and the term having capability of being expressed in the contract. Adelaide City Corporation v Jennings Industries Ltd provided circumstances under which a term to be implied may be considered to be inconsistent with other express terms. This include where the implied terms intends to deal a term already provide in the contract between the parties. Con-Stan Industries of Australia v Norwich Winterthur Insurance (Australia) Ltd on the other hand discussed when a term may be considered to be necessary. It was stated that a term is necessary if it is important for the performance of the contract and it is obvious.
Application
In Codelfa Construction Pty Ltd it was stated that the parties must have contemplated the term. Jake hired a laptop but later realised that the charger was not included. The term that the charger should be included is necessary for the performance of the contract and it is obvious. The laptop was hired for use and at some time was going to be necessary to charge it. This is obvious and necessary since it will defeat the purpose for which the laptop was hired and it can, therefore, be implied based on Con-Stan Industries of Australia. The term also does not contradict any express term of the contract between the parties.
The term does not tend to deal with any matter the parties have expressly dealt with under the contract. This also affirms that the term can be implied into the contract based on Adelaide City Corporation. The term can also be expressed into a contract. Based on the holding in Codelfa Construction Pty Ltd the parties contemplated the term. Even in the purchase of laptops, laptop charger are always provided and so it was parties’ contemplation that the charger would be provided.
Conclusion
The provision of the charger is an implied term of the contract between Jake and Evelyn.

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