Commercial Law - Part A

1. Carl’s situation as per contract law is described as follows:

Issue – In this case study, Carl owns a café of his own and for his café he purchased a ‘Coffee-2000’ espresso machine for $60000 from Coffee CO Pty Ltd. The machine was designed in a perfect manner and it was perfect for Carl’s café as well. Carl told the manager while buying the machine that he is taking the machine for his Café and it is very much important for him. He also told him the no. of customers that approximately I the café on daily basis and also that his café is open from 5 am to 8 pm. After listening to all this, the manager still suggested the machine to Carl so he purchased it. He made an instant payment of $8000 and the rest of the payment will be made weekly $2000 till six months (Goldberger, 2016). Carl signed the sale papers without even reading it and he was also told by the manager that was their regular sales order form . When Carl started using the machine, few days later only he started facing issues in the machine. The technician informed him that this machine requires cleaning after every four hours of service and the cleaning takes at least 1 hour. He also informed him that the machine works only five days a week and it is designed for the morning ‘coffee rush period only’. He also came to know that the machine required expensive repairs after 1 year of service. Now Carl thinks that Coffee Co. cheated him for selling their coffee machine.

Rule – As per the contract law, this is a case of misrepresentation and breach of contract as well. As per the contract law, misrepresentation can be described as a situation whereby one party makes a statement to another party which is not true and which encourages the party to enter into the contract, as a result of which he suffers losses. There are various kinds of misrepresentation like fraudulent misrepresentation, negligent misrepresentation and innocent misrepresentation (Close, 2016). In this case study, the misrepresentation that happened is Fraudulent Misrepresentation as the manager and the manufacturer was aware of the functionalities of machine very clearly still they did not reveal it to the purchases. It is clearly seen that they lied to Carl in order to sell their machine to him. The elements which are located in the case study in relation to fraud are:

  • A false representation is made
  • It is made by someone who knows that it is false i.e. the Manager
  • And made with the intention that the representee will rely on it
  • The representee suffers loss as they relied on the false representer.

In order to come out of this situation, Carl needs to apply for remedies against the action conducted by Coffee co. as soon as they come to know about the fraud.

Analysis – In this case, Carl needs to apply for the remedies and these are like:

  • Rescission – In this, the contract gets unraveled and it places both the parties back to their position they were before they entered into the contact.
  • Affirmation – In this situation, the buyer i.e. Carl cannot rescind the contract once they have filled the form for affirmation (Remedies for consumers, 2020).

Conclusion – This is a case of clear misrepresentation where the seller i.e. Coffee co. did not disclose the actual issues of the machine and sold them to Carl and now when Carl went back to take the refund then they also did not took it back and instead threatened him to take legal actions against him. Carl can take the help of contract law and can sue them in court by charging them of misrepresentation and breach of contract. These actions need to be taken as soon as possible.

2. Carl’s situation as per Australian consumer law is as follows: -

As per the Australian consumer law, the rights and guarantees of the consumer is mentioned which are called as consumer guarantees (Bianchi, 2018). These include the rights for repairs, replacements, refund as well as compensation for the damages. As per the Australian consumer law, if the product or service bought fails to meet the consumer guarantee then they have the right to ask for a repair, replacement or refund. The remedy will depend upon whether the loss is major or minor. In case of Carl, the damage is major and thus as per the legislations of Australian consumer law, he can ask for a refund from the seller as they did not reveal the actual capacity if coffee machine and instead lied about it (Pearson, 2017).

Commercial Law - Part B

The country which is chosen for comparison with Australian legal system is Russia as they do not follow the common law system. They are following the Civil law system in their country.

Role of Precedent

  • As per the Australian legal system, the role of precedent is very important as here the judgers are required to give their judgment similar to the judgment they gave in the previous similar cases on the same subjects. There may be situations that the judgment passes were around years back but still they need to be read and consulted before making the final judgment. The old judgments here are treated as the guidelines which are required to be followed by the precedent while communicating their decisions (Role of Precedent in Australia, 2020). So, the role of the precedent in the common law or the Australian legal system is like this
  • As per the Russian legal system, the precedent is required to follow the civil law system where the higher authorities or the legislatures pass only few specific statutes and then these are only applied by the court. So, here whenever a precedent sits on his chair to read on a case matter then they do not refer the previous case judgment instead they read the statutes given for the guidance. Here, the precedent is also having the right to reinterpret the statute according to the facts mentioned in the case study. These judgments are not made as per the previous decisions made by the courts on similar subjects but the precedents try to have to keep some consistency on the decisions made earlier.

Role of Judges in Dispute Resolution

  • As per the Australian legal system, the High Court of Australia is considered as the highest court and exercises both original and appellate jurisdictions. Here, typically three judges hears the appeal of the single judges of the supreme court and sometimes five judges bench is also set. Here the judges are allowed to apply or determine the law independently and without the interference of the parliament and the executive. Also, most f the civil actions are heard by a judge alone (Dispute resolution in Australia, 2020).
  • As per the Russian legal system, the role of judges for dispute resolution depends upon the rules of fairness between the parties. Here, the judges’ gives their judgment based on the arguments resented him in the court and thus it can be said that they do not have an active role. But here, the judge can ask for the explanation from the parties also asks them to provide documents as a proof for the statements they are presenting. Here, the judges are also allotted the cases bases on their previous experiences and their work load as well. It is also checked that the judges should not have any kind of conflict of interest with any of the concerning arties (Dispute resolution in Russia, 2020).

Examples

  • Example of Australian Legal system includes the case of New South Wales the Supreme court act 1970 (NSW) says that all the proceedings of the court is required to be tried without a jury until and unless the court order otherwise. Similarly, the Federal Court of Australia 1976 states that, unless the court otherwise orders, the civil trials are to be determined by a judge without a jury (Palmer, 2019).
  • Example of Russian legal system is related to a case which is being heard in the European court of human rights. The case was between Pravednaya Vs Russia where a complaint was lodged against the Russian Federation under Article 34 of the convention for the protection of Human Rights and Fundamental Freedoms. The case was done by a Russian National Ms Lidiya Andreyevna Pravednaya. In this case, the judge told his judgment based on hearing both the parties and then reconsidering the documents and the proof presented by both the parties. The final decision was made in favor of Russia but no fully as the violation of articles was done from their side as well (David, 2016).

References for Commercial Law

Goldberger, J., 2016. An overview of developments in key areas of Australian contract law. Commercial Law Quarterly: The Journal of the Commercial Law Association of Australia30(1), p.17.

Close, N., 2016. Coherence-based reasoning in Australian contract law adjudication with broad principles and detailed rules (Doctoral dissertation, University of Newcastle).

Pearson, G., 2017. Further challenges for Australian consumer law. In Consumer Law and Socioeconomic Development (pp. 287-305). Springer, Cham.

Bianchi, L., 2018. Consumer law: Changes to Australian consumer law: Key benefits for vulnerable consumers. LSJ: Law Society of NSW Journal, (50), p.71.

Palmer, E., 2019. An Investigation of Russian Law and Legal Translation.

David, F., 2016. Russian law and globalization. Russian Law Journal4(4).

Remedies for consumers.2020.[Online]. Available through<https://www.accc.gov.au/consumers/consumer-rights-guarantees/repair-replace-refund>.

Role of Precedent in Australia.2020.[Online]. Available through<https://biotech.law.lsu.edu/map/TheImportanceofPrecedent.html>.

Dispute resolution in Australia.2020.[Online]. Available through<https://www.lexology.com/library/detail.aspx?g=78731c5b-d0e2-4be0-b2ce-85ac4d3ee589>.

Dispute resolution in Russia.2020.[Online]. Available through<https://gettingthedealthrough.com/area/9/jurisdiction/26/dispute-resolution-russia/>.

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