Business Law Answer 2022

Running head: BUSINESS LAW
Business Law
Name of the Student
Name of the University
Author Note

BUSINESS LAW
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Answer 1
Legal Issue:
The issue involved in the instant assignment is weather the security company will be
allowed to waive his liability to the Jewellery shop due to the presence of clause 10 in the
agreement of the contract.
Law:
An exclusion clause can be defined as a statement or condition specified in any
agreement of a contract that excludes one party of the contract from his duty to execute his
obligations in the contract. The said explosion clause usually limits the party’s liability to
perform his duty to some extent. This exclusion clause can only be considered by the court as
valid and binding if it satisfies the conditions mentioned below;
Incorporation of the clause: The clause must be included in the agreement of the contract
by either signature, notice or by means of previous dealings, then only it is valid and binding
as seen in Olley v Marlborough Court [1949] 1 K.B. 532. The clause can be included in the
agreement by putting signature of both parties as observed in the L’Estrange v E. Graucob
Ltd [1934] 2 KB 394 case. When the parties sign the contract where the explosion clause is
included, then they are bound by it. Again if the party who wants to rely on such clause
brings it to notice of the other party by reasonable means then also it is binding. However, if
there lies anyways misrepresentation it will be then ineffective as seen in Curtis v Chemical
Cleaning [1951] 1 KB 805 case. The clause can also be included in any contract by means of
previous dealing as seen in McCutcheon v MacBrayn [1964] 1 WLR 165. The words used
in the clause must be simple and clear, free from ambiguity. The clause should be understood
in its ordinary meeting. However, if it is seen that the clause is defeating the main reason of

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creating the contract, then it is ineffective. This was observed in B-Gold Design &
Construction Pte Ltd v Zurich Insurance (Singapore) Pte Ltd [2007] 4 SLR 82 case.
Application:
In the present case, it is observed that clause number 10 of the agreement mentions in
clear words that the security company will not be held responsible for the loss caused during
the usage of their system of security system. Such clause depicts an exclusion clause of the
agreement. This clause was incorporated in the agreement in writing. Moreover, it was signed
by both parties. The wordings of the clothes were very clear and unambiguous. Thus its
incorporation was done properly in the contract but it defeats the main purpose of creating the
contract and hence, it is not effective.
Conclusion:
Hence, after going through the facts of the case and the laws applied on it, it can be
inferred that the Transglobal Alarm Monitoring Pty Ltd cannot escape his liability to the Fine
Diamond Jewellery.
Answer 2:
Issue:
The issue that has to be analysed here is whether Fine Diamond Jewellery will be able
to claim compensation for the losses occurred due to robbery on the account of the failure of
working of the security system of the Transglobal Alarm Monitoring Pty Ltd.
Law:
When a contract is formed, the parties are bound to perform their obligations. If a
party fails to perform his duty, he will be liable to the other aggrieved party who can claim
damages for the loss suffered by him. Damages can be given in the form of compensation and