Assignment - Commercial Law

Running head: COMMERCIAL LAW
Commercial Law
Name of the Student
Name of the University
Author Note

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Question 1:
According to the law of negligence, an individual is at the obligation to exercise duty of
care towards another individual in relation to the contract between them. In this regard, it is
worth noting, that such individual is at the obligation to implement reasonable measures for the
purpose of avoiding risks which may arise as a result of at or omission on the part of the
individual, resulting into damage which caused injury to the aggrieved party. However, the
nature of the injury may be such which can be foreseeable by any reasonable man of prudent
nature. For the purpose of establishing successful claim for negligence, it is important for the
party to prove that-
1) There is a duty of care on the part of the defendant.
2) Such duty of care has been breached by the defendant.
3) The injury caused to the plaintiff is as a result of the breach of duty on the part of the
defendant.
1) Duty of Care:
The provision of the Wrongs Act 1958 has been governing the principles of law of
negligence which provides detailed explanation about the duty of care. It is worth mentioning
that, an individual who owes duty of care to the person who has assigned him with a specified
duty. However, the duty should be carried on in such a way so that it does not cause injury to the
plaintiff. In the case of Donoghue v Stevenson [1932] A.C. 562, the subject-matter of ‘neighbor
principle’ enumerated. In this case, it was held that, one must reasonably exercise duty of care
towards their neighbors. Under the application of law, ‘neighbor’ is regarded as a person who
can suffer injury as a result of act or omission on the part of the defendant.

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2) Breach of duty of care:
In order to establish that there has been breach of duty of care, the Court shall take into
consideration the circumstances and the conduct of the defendant, whether; the defendant has
taken reasonable care. The Court is at the authority to determine that whether the defendant has
exercised reasonable care which would have been exercised by any reasonable person of prudent
nature. It is noteworthy to mention here that, the negligent action of the defendant can be
considered from his action which caused injury to the plaintiff. The facts of the case itself
provide evidence regarding the matter in concern which is termed as the principle of res ipsa
loquitor.
3) Injury caused to the plaintiff as a result of breach:
It is essential on the part of the plaintiff to prove that the damages and injuries caused to the
plaintiff are due to the breach of duty on the part of the defendant. In this regard, the ‘but for’ test
can be applied by the plaintiff for the purpose of establishing that the injury has been caused as a
result of breach of duty by the defendant.
Causation of the injury:
According to the provisions of Section 51 of the Wrongs Act 1958, negligence takes
place as a result of factual causation of harm in which the plaintiff is required to establish the
facts which contributed to the causation of his injury. However, the plaintiff must prove that, the
injury suffered by the plaintiff was unexpected and that he was not aware of it.
In case of inherent risk, the plaintiff does not have the authority to claim damages for the
injury. However, an inherent risk cannot be avoided by the defendant even if he had exercised

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reasonable care. The Courts, while determining the effectiveness of such injury shall take into
consideration the extent of harm which is likely to cause injury to the plaintiff.
In the present scenario of Thermomix appliance, as a result of defect in the kitchen
appliance, it caused injuries to the owners. It is worthwhile to refer the case of Donoghue v
Stevenson [1932] A.C. 562 because in this case, a duty of care was owed by the manufacturers in
regard to the product sold by them. In this case, a legal principle was established which protected
consumers against the injury caused as a result of defective commodities. In the present case,
there is a duty of care on the part of Thermomix Appliances in ensuring that the products can be
safely used. In this regard, the company shall be held liable to their customers because the burn
injuries suffered by them was as a result of direct breach on the part of the company. The
company failed to provide proper care and exercise in ensuring the safety conditions of the
product. Therefore, it can be rightly stated that the injuries suffered is as a result of breach on the
part of the company. In this regard, consumers can claim damages for personal injury caused as a
result of negligent act f the company.
According to the provisions of Wrongs Act 1958, a customer is not at the authority to
make non-monetary claims. It implies that consumers are not entitled to make claims for the
injuries suffered by them unless the percentage of such injury is 5% as incorporated in the
Medical Association Guidelines (AMA). However, it is noteworthy to mention here that, the
amendments that have been made to the Wrongs Act 1958, in regard to the monetary-claims by
the consumers shall be applied in cases when the injuries suffered by the claimant are severe. In
this regard, it is worth noting that the injured party cannot make any claim within the period of 3
years from the date on which such injury was sustained. However, it is important to file relevant
documents within the time period of 90 days before the expiration of the stipulated period.

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Question 2:
From the very beginning, various limitations has been set out in the Wrongs Act 1958
regard to the compensation in case of economic and non-economic loss arising as a result of
personal injury suffered by the claimant (Popa, 2017). In this regard, the Australian Law Reform
Commission has implemented caps which can be applied on non-economic damages for the
purpose of ensuring that equal importance should be assured to the privacy interest and status of
both the defendant and the claimant (Ballantyne & Murphy, 2016). It is worthwhile to refer here
that, such damages shall be acting as a deterrent factor for the defendant as it would punish him
in order to prevent him from conducting breach of duty of reasonable care and standard (Barry,
2017). It is noteworthy to mention here that, the thresholds that has been depicted in the
provision have reduced the possibility of liability under the law of torts which can be emphasized
as-
1. The incorporation of the risk management measures has been reduced by the threshold.
2. The eligibility of the wrongdoer and his capacity to pay compensation for the injury
reduces.
3. Certain negligent act has been established by the threshold for the purpose of excluding
the infringing party from facing any financial disabilities.
However, these arguments were listed in the favor of the thresholds which could be imposed
for the purpose of compensating the injured party in case of non-economic damages and losses
sustained by them. The thresholds can be awarded to any injured party under certain
circumstances in case when the claimant emphasizes on the fact that they have acted according
to the threshold that has been imposed for the purpose of obtaining the compensation in matter

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(Watson, 2016). In this context, it is worth noting that only those parties would be entitled to
monetary compensation who suffered 30 percent injuries (Baker, 2016). It is worth examining
the fact that, as a result of imposition of thresholds, it has lessened the probability of making any
further claim for false and irrelevant expenses which are in close relation to the injury sustained
by the aggrieved party. However, the aggrieved parties shall only be entitled to receive monetary
compensation in cases which involves personal injuries which can be examined by evaluating the
level of harm suffered by the aggrieved part as a result of action on the part of the wrongdoer.
Under the law of negligence, the aggrieved party may be entitled to a number of damages.
Such damages are to be compensated by the wrongdoer in regard to the injury he caused to the
aggrieved party (Stickley et al., 2016). After examining the evidences presented, the Court is at
the authority to award damages in the form of compensation with an aim of restoring the position
of the plaintiff which was the previous position of the plaintiff prior to which the injury has been
caused as a result of act or omission on the part of the wrongdoer.
It is worth mentioning that, the nature of the damage suffered by the plaintiff is concerned
with temporary or permanent physical injury and sometimes non-monetary loss. However, such
non-monetary damages suffered by the plaintiff may enumerate as a result of physical injury
which are associated with physical sufferings, emotional trauma, loss of life, loss of amenities
and disfigurement (Reynolds & Kozub, 2017). It can be rightly stated, that the nature of the
damages for which the claimant is entitled should include non-economic losses that are
considered as general damages. However, the injury caused as a result of emotional trauma and
physical injuries cannot be compensated therefore; the main reason behind such compensation is
likely to assist the claimant to the process of obtaining any alternative source of satisfaction and
for the purpose of making any payment for the costs incurred.

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Various states in regard to their legal and statutory framework has introduced a number of
limitations in order to sustain personal injuries and the damages claimed by the aggrieved
parties. It is evident that, the Australian states has specified caps on non-economic losses which
can be observed in medical cases however; very few states have implemented such caps on non-
economic losses in relation to the cases involving personal injuries. It is worthwhile to mention
here that, there is a difference in the amount of caps in different states with a variation from
$350,000 to $750,000 (Popa, 2017).
Certain exceptions are available in case of laws which are in relation to death or injuries. In
such cases, a relatively higher cap is permitted and sometimes the damaged cap is entirely
removed. In Victoria, the claimant may claim compensation for suffering non-pecuniary injuries.
However, it is required on the part of the claimant to establish that 30% of the injury that has ben
sustained is as a result of serious consequences. In this regard, it is worth noting that, the worth
of the damage cap in case of non-pecuniary loss in Victoria is $527,610.
Question 3:
According to the provisions of Part 3-5 of the Australian Consumer Law, there is a
liability on the part of the manufacturer in regard to the safety measures concerned with
particular products. There is a liability on the part of the manufacturer in relation to any
monetary loss and any personal damage that can be suffered by the customers while by utilizing
such products that has been supplied by the manufacturer (Taylor & McNamara, 2014).
According to the provisions of Section 138 of the Australian Consumer Law, there is an
authority on the part of an individual consumer to bring claim for action against any
manufacturer in case of any personal injury or damage suffered as a result of breach on the part

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of the manufacturer. In some cases, it may happen that the aggrieved party may fail to identify
the actual manufacturer. In such cases, if the supplier fails in his part to provide relevant
information about the manufacturer; the claimant may claim compensation from the suppliers on
the ground of failing to provide appropriate information regarding the manufacturer of the faulty
goods.
According to the scenario of the Thermomix appliances, there is an authority on the part
of the aggrieved customers to bring claim for compensation by involving a legal proceeding
against the manufacturer for failure to comply with the safety measures in the kitchen appliance
model which caused serious burn injuries to the customers. Therefore, in this regard, the
consumers are entitled to claim compensation for the personal injuries.
According to the provisions of Sections 142 and 148 of the Australian Consumer Law,
various defenses are available to a manufacturer which can be emphasized as-
I. It is important on the part of the manufacturers to contend that, the goods were not
defective when it was delivered to the customers.
II. The manufacturer was not permitted under the scientific and technical department for the
purpose of checking the fault in the commodities.
III. The nature of the loss is as a result of damages caused to land or buildings.
IV. The defect in the goods has been caused as a result of conformity by complying with the
compulsory standards in relation to such commodity.
According to Part 5 of the Australian Consumer Law, the Court can impose civil monetary
penalties upon the defendant, if he has contravened the provisions of civil standards related to the
manufactured goods (Pearson, 2017). In the present case, the Thermomix Company did not act

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according to the legal provisions set out in the Section 106(1) of the Australian Commercial Law
and therefore paid an amount of $1.1 million. In this regard, it is noteworthy to mention here
that, as the plaintiffs have suffered serious burn injuries therefore; the Company is liable to pay
an amount of $16,500 according to the provisions of Section 131 or section 132 of the Australian
Commercial Law which shall serve as compensation towards the suffered aggrieved parties
(Cantatore & Marshall, 2016).
The most important remedy that shall be available to the aggrieved parties has been depicted
under the provisions of Section 232 of the Australian Consumer Law (North & Flitcroft, 2016).
According to the case study of Thermomix Company, in relation to the provisions of Section
232, the aggrieved consumers are at the authority to bring a claim for the purpose of obtaining an
injunction order against the company for the infringement of the provisions of safety standards.
According to the provisions of Section 271 of the Australian Commercial Law, an alternative
remedy is available to the consumers apart from the remedy of compensation in case of injuries
suffered as a result of the company (Pearson, 2017). Finally, it can be stated that if any
manufacturer or supplier has acted in contravention of any consumer guarantee; then the
aggrieved consumer has the right to bring a claim for legal action against them.

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References:
Case:
Donoghue v Stevenson [1932] A.C. 562.
Journals:
Baker, J. (2016). Causation laws should recognise loss of chance. Precedent (Sydney, NSW),
(133), 58.
Ballantyne, T., & Murphy, K. (2016). Claims by third parties. Precedent (Sydney, NSW), (133),
14.
Barry, C. (2017). Statutory modifications of contributory negligence at common law. Precedent
(Sydney, NSW), (140), 12.
Cantatore, F., & Marshall, B. (2016). Navigating the Australian Consumer Law in the digital
marketplace: Hazards for commercial entities. Competition and Consumer Law Journal,
23(1), 232.
North, J., & Flitcroft, R. (2016). Businesses beware When does the Australian Consumer Law
apply?. Governance Directions, 68(5), 306.
Pearson, G. (2017). Current Issues for Consumer Protection Law in Australia. In Consumer Law
and Socioeconomic Development (pp. 199-208). Springer, Cham.
Pearson, G. (2017). Further challenges for Australian consumer law. In Consumer Law and
Socioeconomic Development (pp. 287-305). Springer, Cham.

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Popa, M. (2017). Practitioner perspectives on continuing legal challenges in mental harm and
medical negligence: Time for a no-fault approach?. Tort Law Review, 25(1), 19-36.
Popa, M. (2017). Righting wrongs: Lawyers' reflections on the amendments to the Wrongs Act
1958 (Vic) on medical negligence and mental harm claims. Torts Law Journal, 24(1), 64-
82.
Reynolds, T., & Kozub, P. (2017). Risk: Has your negligence caused a loss?. LSJ: Law Society
of NSW Journal, (39), 80.
Stickley, A., Christensen, S., Duncan, W. D., & Buchbach, J. (2016). Predictive technology and
natural hazards: risk for Australian planning authorities?. International Journal of Law in
the Built Environment, 8(1), 42-55.
Taylor, D., & McNamara, N. (2014). The Australian consumer law after the first three years-is it
a success?. Curtin Law and Taxation Review, 1(1), 96-132.
Watson, G. (2016). Public law in private law actions: Statutory duties, functions and powers
under CLAs. Precedent (Sydney, NSW), (136), 45.