Business Law Question Answer 2022

BUSINESS LAW

Answer 1)
The judicial system is one of the most essential components of a social system of a country or
a region. In context of the country New Zealand, the courts are structured in the form of a
pyramid to serve the judicial decisions on the matters of the conflicts in the society. It is vital
to note that at the lowest level is the District Court, followed by the High Court, the Court of
Appeal and the Supreme Court at the top. Thus, if the applicants are unsatisfied with the
court’s decision at one of the lower courts, can move to the higher courts for the
reconsideration of the said matter. The judicial system of New Zealand is structured in a
manner so as to ensure an independent decision being served that is where the impact of the
individual personality in the determination of the cases is minimized. However, it cannot be
entirely eliminated. This is because the judges of the higher courts have the power of
overruling a decision taken by the lower court. A decision served by a higher court is binding
on the other lower courts. In addition to state, the decisions of the Supreme Court, which is
regarded as the final court of appeal, are binding on all other courts.
In order to avoid the erratic behaviour of judges or the conflict of interest in the case
decisions, the law is based on the doctrine of the precedent and the multi member courts of
appeal. According to the doctrine of the precedent, there must be consistency and the
certainty in the application of the law by the various judges of the legal system. When
deciding the case, the judges must first decide onto what happened, decide the relevant
principle of law that is applicable on the given situation, and lastly apply the legal rules to the
given circumstances. Once the decision is passed, the said statement of law is stated to
become the part of the law, for the application of the same in a later case on the similar lines
of facts. The principles of the doctrine of the precedent are stated as follows. The first
principle of “stare decisis” states that where the material facts of the cases are similar, the
decision must be on the same lines. Yet another principle is of the “ratio decidendi”, which
states that a consistent legal principle must be applied in the similar cases.
For instance, one of the most popular contract laws cases of New Zealand is that of the
Phillips v Phillips1 which is considered a benchmark case on the issue of the parties making a
same mistake in the formation of a contract. The case has been repeatedly cited where the
issues are in the contract formation relating to the mutual mistake of the parties. In yet
1 Phillips v Phillips [1993] 3 NZLR 159; 10 FRNZ 110

another instance, the decision established in the case of Sky City Auckland Ltd V Wu2 was
cited in the judgement pronounced in the case of Jones v Sky City Auckland Ltd3
As per the discussions conducted in the previous parts, it can be concluded that the judicial
system of New Zealand has been well designed and is based on the system of hierarchy and
precedent. These systems aid in the justice being served in the consistent manner and various
courts reconsider the matter when the situation or the applicant demands.
Answer 2)
Introduction
The formation of contract is comprised of various essential conditions to be complied with,
for the valid enforcement of a contract in the courts of law. The law of the contract regulates
the matters pertaining to the contract creation, administration and the execution in the New
Zealand. The following report would shed light on the various aspects of the creation of the
contract for the executives of the company A, to be paid attention to for a valid contract to be
created. The report would further relate the said principles to the circumstances of the govern
case, for the understanding of the same. The three key issues in the contract formation in the
stated circumstances would be identified.
The law of the Contract
As per the law of the contract, there are various essential conditions to be complied with for a
valid contract to be created, that can be enforced at the courts of the law. These key
conditions are explained as follows. The first key condition is that there must be intention to
create the legal relationships, offer and acceptance by the parties on the terms of the contract,
a support of the consideration and that the said terms of the contract must be certain and not
vague4.
One of the essential terms of the contract creation to be valid is that the terms of the contracts
must be certain. As per this condition, if the agreement terms are vague, or uncertain, a
binding contract cannot be stated to be formed, as held in the case of Foley v Classique
Coaches Ltd5. The result of which is that the said agreement would not be enforced at the
courts of law, in the events when certain key terms are not settled by the parties. It is vital for
2 Sky City Aukland Ltd V Wu [2002] 3 NZLR 621 (CA)
3 Jones v Sky City Auckland Ltd [2004] 1 NZLR 192 (CA)
4New Zealand Law Commission, The law of contract (Web Page) <
http://www.nzlii.org/nz/other/nzlc/report/R50/R50-3.html>
5 Foley v Classique V Coaches Ltd [1934] 2 KB 1