HI6027 Business and Corporate Law Online Exam

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HI6027 Business and Corporate Law
Online Exam
Trimester 3 2019
Instructions:
The exam consists of five (5) questions divided into three (3) Sections.
Answer all questions in the answer boxes provided in this paper.
Section A – 1 Short Answer question (10 marks)
Section B – 3 Case Studies / Problem-type questions (30 marks)
Section C – 1 Critical Thinking question (10 marks)
Assessment Weight:
This exam accounts for 50 percent (50%) of total marks.
Question 1 10 marks
Question 2 10 marks
Question 3 10 marks
Question 4 10 marks
Question 5 10 marks
Total marks 50 marks
HI6027 Online Exam T3 2019

Part A – Short Answer Question (10 marks)
Question 1
List the characteristics of what would be considered to be a good legal system. Give an
example of an actual law which you would consider fulfils the requirements of ‘good law’.
ANSWER: ** Answer box will enlarge as you type
A good legal system is transparent with legislature acting with honesty guided by
ethics. Cases are finalized by the courts of law with anticipated remedies issued
applying crucial law efficiently. It promotes fair and equitable conclusion of cases.
The legal system is just and fair with possible outcomes anticipated by both parties
usually met at the end. A good legal system is corruption free and does not accept a
benefit or allow for an exchange of favor in cases. The responsible personnel apply
laws to the latter to achieve a pleasing outcome and promote justice to the affected
individuals. A good legal system does not act under favors to any party. A good legal
system is free from influence by government and prominent leaders. The law is
usually an independent body that protect every citizen right equal without
discrimination. The law is accountable in any precedence. This increases the
confidence that people have entrusted in the law.
An example of an actual law is the rule of law that means equality before the law.
Part B – Case Studies / Problem-type questions (30 marks)
Instructions: Your answers must be supported by legal reasoning and case law or
legislation in order to gain a passing grade.
Question 2 (10 marks)
Belinda wants to buy a second-hand car and visits a number of car dealers before deciding to
purchase an as new 1998 Ford Mustang from American Car Sales. The sales person, Jaxson,
tells Belinda that the car was manufactured in 1998 and had only done 54,000 kms.
Three months later, Belinda has the Mustang serviced with her local mechanic who was a
Mustang enthusiast. He comments on the fact that the car was in pretty good condition for a
1994 Mustang, though he was surprised that it had only done 54,000 kms. He would not
have been surprised if it had done 100,000 kms.
Belinda makes further inquiries and discovers that the Mustang was in fact made in 1994
and she has paid about $5,000 more than the actual market value of the car. Belinda intends
to approach American Car Sales about this issue.
Does Belinda have any contractual rights against American Car Sales?
Required:
You are expected to discuss legal rules learned regarding terms of a contract, in particular
statements and representations, and conditions and warranties.
HI6027 Online Exam T3 2019

Do not answer this question based on Australian Consumer Law principles. No credit will be
given if you do so.
ANSWER:
Contract conditions refers warranties, condition, statements and representations.
A condition is a term that offers the grieved party a right to terminate the contract or
to affirm the contract. It offers the party rights to claim for damages incurred.
A warranty does not offer the grieved individual right to terminate the contract but
gives right to claim for damages
A statement made by both parties during the contract might have force. On the other
hand, it may lack force hence a representation. A representation is intended to attract
the other part to enter into contract but the representation terms are not capable of
imposing any form of liability if there is breach of contract.
Term of a contract refers to the remedies for contractual damages
Sales puff means no remedy
Mere representation means no cation is taken for breach of contract. besides, ACL
breach of s 18 outlines broader remedies. Collateral contract are those that remedy for
the breach of collateral contract. The terms of a contract must have promissory
features which intensions to make legal relations in which a reasonable individual
have thoughts intended in the given circumstance.
HI6027 Online Exam T3 2019

Question 3 (10 marks)
A news story from 2017 reported that Sydney woman was hospitalised after glass found
in takeaway coffee.
According to the report, the woman, 39 year-old Natalie Grabowski, was hospitalised
with internal bleeding after swallowing glass she believes was in the ice served with her
takeaway iced coffee at a popular inner-west cafe.
She had bought the cold brew coffee from BrewCity Redfern on Redfern’s O’Connell St
one Sunday morning earlier this month. On taking her first gulp of the iced coffee,
Natalie felt something scratch her throat. According to her, it felt “hard and sharp, and
just not right.” She then spat out the small pieces of ice she had not yet swallowed, and
rolled them in her fingers trying to figure out what was wrong. One of the pieces wasn’t
melting and cut her finger. She then realised it was actually a small piece of sharp glass.
Later that morning, she felt suddenly sick. Things didn’t look right when she went to the
toilet. Colleagues called an ambulance which transported Natalie to the nearest surgical
hospital.
After two days of “humiliating” tests and procedures, much of that time spent in
discomfort and pain, Natalie was discharged without having to go under the knife.
Medical reports said she had suffered rectal bleeding after ingesting the piece of glass.
The distressed coffee lover said while her injuries seem to have passed, she feels like
the incident will affect her forever.
Required:
a) What elements must Natalie prove to be able to succeed in an action in negligence
against the coffee shop? Identify and briefly explain each element. (3 mark)
ANSWER:
To succeed in an action of negligence, Natalie has to prove elements such as Duty,
damages, causation and breach of duty.
Duty: in a negligence claim, it is in order to assess if the plaintiff owes the defendant a
duty of care. If the relationship between the defendant and the plaintiff is viable for a
legal duty.
Breach of duty: in this case, one will assess whether the defendant breached the duty
by doing an activity that is “reasonable prudent person”
Causation: this refers to the fact the actions of the defendant resulted to injury or
damage suffered by the plaintiff.
Damages this requires the court and the legislation to compensate the plaintiff for the
damages incurred maybe through compensation among other remedies i.e. medical
care.
b) Apply each element to the facts of this case and determine whether Natalie will be
successful in her negligence claim. (7 marks)
ANSWER:
Natalie will be successful in her negligence claim because she meets all the events of
negligence for instance:
HI6027 Online Exam T3 2019

Duty: in a negligence claim, it is in order to asses if the plaintiff owes the defendant a
duty of care. Natalie owes the defendant i.e. the BrewCity restaurant had a
relationship. Natalie is a customer who purchased coffee from the restaurant. After
which she swallowed glass which was from the coffee she bought from the restaurant.
Hence, there is a relationship between Natalie and the restaurant.
Breach of duty: in this case, the defendant i.e. the restaurant had brewed coffee that
had sharp glass pieces which were dangerous for human consumption. Hence, their
coffee had exposed Natalie to internal bleeding that made her hospitalized.
Causation: this refers to the fact the actions of the defendant i.e. the restaurant resulted
to injury or damage suffered by the plaintiff i.e. Natalie. After drinking coffee bought
from the restaurant, Natalie felt a sharp pain. When she spat out the pieces of ice she
had swallowed, she discovered the pieces of glass that cause her pain. She suffered
internal bleeding which was due to the glass pieces that she had swallowed.
Damages: Natalie should be compensated for the damages incurred such as medical
expenses among others.
*** Do not answer these questions based on any principles of Australian Consumer Law. No
credit will be given if you do so.
HI6027 Online Exam T3 2019

Question 4 (10 marks)
Carlos went to a fish shop and asked for 1 kilo of two fresh prawns for dinner. The fish shop
owner explained that he had no fresh prawns but that he had some boiled ones, which he
sold to Carlos. It turned out that the prawns weren’t fresh and Carlos, after eating them,
became seriously ill.
Required:
a) Does Carlos have any action open to him against the fish shop under the Australian
Consumer Law? You must specify which sections of the ACL apply to this case. (2 marks)
ANSWER:
Carlos has an action to open against to the fish seller under the Australian Consumer
Law. The fish seller was supposed to sell goods that are fit for the purpose that Carlos,
as the consumer made known prior to purchasing. Since the seer did not disclose t
Carlos that the fish was not fresh, Carlos can take action against the seller. Section
53(2) of the ACL introduced in 1980offers the consumer the rights to ask the seller to
remedy and replace goods not in conformity with their demands.
b) What does Carlos need to prove to succeed in claiming against the fish shop based on
Australian Consumer Law? (8 marks)
ANSWER:
Carlos needs to prove that the loss that the incurred due to the seller’s ignorance. He
has to offer proof of purchase to acquire compensation and care by the seller
The seller cannot sell a product if he or she is aware of the injury or illness that the
product may cause. In this case, the seller is aware that the fish sold is not fresh and is
likely to harm Carlos and other customers. The Seller is required by the ACL to report
such case to ACCC within two days. The seller needs to conduct voluntary product
recall as the product is not safe and recalling it would remove it from distribution and
consumption by buyers.
*** Do not answer these questions based on any principles of Contract Law. No credit will
be given if you do so.
Part C – Critical Thinking (10 marks)
Question 5
If the directors of a company make a decision, which later on proves not to be a good
decision and causes the company to lose money, will the directors be liable for failure
to exercise their duty of care and diligence?
ANSWER:
HI6027 Online Exam T3 2019

Legislations need directors to perform reasonable care, diligence and skill. The law in
consideration to the breach of these duties specified for directors offers standard care
that directors are supposed to abide with. Anyone doing the work of a director must
possess experience, knowledge and skills. Hence, it is necessary for directors to be
competent as they perform their duties. Any director is mandated to exercise their
duties diligently. They are supposed to keep information through their coordinators
appropriate. directors can depend on expertise from their colleagues and delegate
duties such that they will not have to attend to al duties. Hence, a director who fails to
make viable decision for the company is liable for failure to exercise their duty with
care and diligence.
END OF EXAMINATION PAPER
HI6027 Online Exam T3 2019