Business Law Assignment: Legal Systems, Contracts and Consumer Law

This business law assignment is a comparative analysis of the legal systems of the UK and Australia, focusing on the application of the rules of recognition, change, and adjudication. The assignment delves into contract law, including the elements of a valid contract, misrepresentation, and consumer rights. The report examines a case involving an internet service provider (jjNet) and a consumer (Sandra), assessing the validity of the contract, potential breaches, and consumer guarantees under the Australian Consumer Law. It explores the concept of consumer, acceptable quality of goods, and the implications of misleading conduct. The assignment highlights key legal principles, including the requirements for a valid contract, the consequences of misrepresentation, and the application of consumer protection laws in Australia. The analysis includes how the consumer can seek remedies for the faulty product and misleading information. The report offers a detailed examination of the legal framework and its application in the given scenario.

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

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Question 1
The foundation of a legal system can be based on three rules, namely rule of
recognition, rule of change and rule of adjudication. The concept of these three rules in a
legal system has evolved with the theory of legal positivism of H. L. A. Hart1. This paper
focuses on the application of these three rules in the legal system of UK and a comparison
between the Australian legal system and the legal system of UK in applying the same in tune
with these rules.
The requirement that needs to be satisfied while verifying whether a rule can achieve
the status of law is the rule of recognition. It is to be verified that a law must prevail over the
rest. It must establish supremacy over the land2. In UK, the Constitution have supreme
authority. It dominates over the Parliamentary Enactment, common law, local custom and
general custom3. Another aspect of the rule of recognition is that whether the validity of an
enactment can be questioned based on the other. In UK, the validity of a bye-law can be
verified in the light of Parliamentary Enactment, but a question cannot be brought against the
validity of the Parliamentary Enactment on the basis of some other law. Again the
constitution of UK has the supreme dominance over any other law in the land. The Common
Law and the precedents also forms the part of the legal system as long as those are consistent
with the parliamentary enactments and the Constitution4. In Australia, however, the
Australian Constitution is the legal foundation in the country. The Constitution of Australia is
a supreme authority in the light of which all other laws of the lands are validated. The
1 d'Almeida, Luís Duarte, James Edwards, and Andrea Dolcetti, eds. Reading HLA Hart's' The Concept of Law'.
A&C Black, 2014.
2 Hart, Herbert Lionel Adolphus. "Positivism and the Separation of Law and Morals." In Law and Morality, pp.
63-99. Routledge, 2017.
3 Allan, James. "The Glorious Revolution and the Rule of Recognition." (2015): 509.
4 French, Robert. "The Rule of Law and the Australian Constitution: Human Rights and Judicial Review in
Australia and Canada." (2017): 725.

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Australian legal framework is a federal one. Laws in Australia are enacted both by the federal
government and the state government. The federal enactments prevails over the state laws.
The rule of change ensures the process of creation, alteration or deletion of existing
Laws to meet the present demands of the society5. In UK, legislations are enacted following
the introduction of a bill in the Parliament. The bill, thus introduced, must be passed by both
the house of the Parliament. After that, it must obtain the Royal Assent. Any enactment
whether a Parliamentary Enactment or a bye law or any other law of the land if inconsistent
with the Constitution, it must be altered to the extent of the inconsistency by way of
amendments or complete deletions. However in Australia, a new legislation can be enacted or
altered or deleted under the authority of Federal Parliament and in compliance with the Act of
Parliament. Whenever a state Act is inconsistent with the federal Acts, the state Acts needs to
be amended to the extent of the inconsistency.
The rule of adjudication is concerned with the remedy prescribed by the society, when
a rule of law is violated6. This rule mainly focuses on the court and enforcement of Law. UK
has the Supreme Court with the highest Authority. Subordinate to the Supreme Court, the
County Courts, Magistrate’s Court, Crown Court, Royal Court of Justice and Youth Court are
there. A party not satisfied with the decision of a lower court may bring an appeal to the
higher court under this system, questioning the order of the lower court. The orders of the
Supreme Court are binding on the lower courts and cannot be challenged by any other Courts.
Australia has a similar hierarchy of courts. The only difference is that Australia has a Federal
High Court at the peak of the hierarchy. All the states in Australia has a Supreme Court,
which is subordinate to the federal High Court. The orders of the state Supreme Courts can be
5 Howarth, David, and Shona Wilson Stark. "HLA Hart's secondary rules: what do ‘officials’ really think?."
International Journal of Law in Context 14, no. 1 (2018): 61-86.
6 Craig, Paul. "Formal and substantive conceptions of the rule of law: an analytical framework." In The Rule of
Law and the Separation of Powers, pp. 95-115. Routledge, 2017.

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questioned through an appeal in the High Court. High Court decisions are binding on all other
Courts.
The requirements of rule of recognition, rule of change and rule of adjudication are
followed in both the countries, but legal structure is different. Moreover, most of the laws in
UK are not codified whereas the law of Australia are well enacted. In Australia, the enacted
legislation has a superiority over the common law while in UK the Constitution itself is
uncodified. However, laws of both the countries have emerged from the Common Law.

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Question 2
Issue
The issue in question is that, whether Sandra has any right to legal actions and claim
damages against her internet service provider jjNet.
Rule
A contract, to be considered valid must possess the following elements, namely,
 There must be an offer, which has been accepted forming an agreement.
 The parties to the agreement must be competent to contract.
 There must be a consideration for both the parties of the contract.
 The contract must be created in the furtherance of an intention to create legal relations
 The consent of the parties must be obtained without the deceptive and misleading
representation about the terms of the contract7.
The consent of a person, if obtained by misrepresentation of material facts, the
contract becomes voidable at the option of the person whose consent was thus obtained8. The
person whose consent was obtained in such a way would have an option of either repudiating
the contract or ratify the same.
The parties entering into the contract must agree on the same thing in the same sense.
The terms of the contract, entered into must be understood in the same manner by both the
parties to the contract.
7 McKendrick, Ewan, and Qiao Liu. Contract Law: Australian Edition. Macmillan International Higher
Education, 2015.
8 Poole, Jill. Textbook on contract law. Oxford University Press, 2016.

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However, the person who after reading the terms of the contract agrees to it, cannot
repudiate it because of the terms being unfair. This is because he has already agreed to the
same.
Section 3 of the Australian consumer law9 provides for the definition of the term
consumer. To be qualified as a consumer, a person should have purchased any product for the
domestic and household purpose and the value of such a product should not exceed $40000.
The product should also not be purchased for the purpose of re-supply or re-sale, as a person
buying a product for re-supply or resale will not be considered to be a consumer.
Section 18 prohibits the seller or supplier of a commodity to participate in any
misleading or deceiving conduct or any conduct, which may result in a misleading or
deceiving apprehension.
Section 54(1) contains the provision that, a good sold by the supplier must be of
acceptable quality. Section 54(2) the goods must be fit for use, for which goods of similar
nature are supplied. The appearance and the finishing of the goods must be in conformity
with the standard norms. The seller should also ensure that the commodity sold is not
defective. It is free from hazards and the durability of the same must be ensured. Section
54(3) provides for the aspects that needs to be considered while ensuring the requirements of
section 54(2), which includes nature, price, display in the package, representations by the
supplier and other similar aspects. These aspects needs to be considered before examining a
case under the light of section 54(2). Section 54(4) mentions that whenever the goods
supplied are not of standard quality and the buyer had the knowledge of the same at the time
of the purchase and still he agrees to purchase, then the goods are assumed to be of standard
9 COMPETITION AND CONSUMER ACT 2010

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quality. Section 54(5) provides that when the goods so displayed for sale is not fit for a
particular customer, that fact must be specifically mentioned in the display and the seller
must maintain a transparency about the fact in the display. According to section 54(6), goods
are assumed to be of acceptable quality if the quality of the same is deteriorated by the fault
of the consumer or the abnormal use by the consumer and not due to the fault of the seller or
the manufacturer. Section 54(7) states that when the customer have examined the goods
before making the purchase and such an examination is likely to reveal any defect, the goods
are assumed to be of acceptable quality.
Application
Sandra bought the internet package agreeing on the terms provided in the brochure. It
was specifically written in the brochure that the package provides an internet speed of up to
100 Megabits per second will be provided. It was also mentioned that the package will
include 10 GB of data per month, which was also provided. There was no element of
misrepresentation in the same. The terms of the contract was not misleading. However, the
phone she bought was expected to be of acceptable quality, but it turned out to be
troublesome and worn-out. Although, there is no mention of the quality of the phone, but it is
expected to be of standard quality. Therefore, the contract of sale of the internet package is
valid but the phone was included in the package, which was not of the acceptable quality.
However, Sandra has purchased the internet /phone package from jjNet, which
renders her to a consumer under section 310, as the cost of the item sold was less than $40,000
and it was for domestic use and Sandra has no intention of re-selling or re-supplying it. The
online brochure stating the assurance of an internet speed of up to 100 Megabits per second
though cannot be treated as an outright deception or misleading. However, it can be treated as
10 Daly, Angela, and Amanda Scardamaglia. "Profiling the Australian Google consumer: Implications of search
engine practices for consumer law and policy." Journal of Consumer Policy 40, no. 3 (2017): 299-320.

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a statement, which is likely to deceive or mislead as most of the times the internet speed is
not 100 Megabits per second. Hence, this case also comes under the purview of and is a
violation of section 1811 as the online brochure is likely to deceive or mislead. Again, the
phone and the modem were purchased with the internet package, which attracts the law of
guarantee with them. The appearance and the finishing of the phone was not of acceptable
norms when the consumer received it, which is a violation of section 54(1)12. The consumer
alleged to have trouble with the keys of the phone, which renders the phone unfit for the
purpose for which it was bought. As the battery of the phone dies within a few hours, it
cannot be said to be of acceptable quality and is a violation of the section 54(2)13. These
brings the case under the purview of section 54. The refusal of the replacement of the phone
by jjNet is a violation of the law of guarantee, which is a violation of the Australian
Consumer Law14. The same can be illustrated with the case of Australian Competition and
Consumer Commission v Dukemaster Pty Ltd [2009] FCA 682; [2009] ATPR 42-29015.
Conclusion
Sandra has a right to legal actions and claim damages against her internet service
provider jjNet.
11 Corones, Stephen G., Sharon A. Christensen, and Nicola Howell. "Submission to Australian Consumer Law
Review Issues Paper." (2016).
12 Twigg-Flesner, Christian. Consumer product guarantees. Routledge, 2017.
13 Sims, Alexandra. "The guarantee of delivery of goods under the Consumer Guarantees Act 1993 and its
implications for Australia." (2016).
14 Laying, Loose. "DEN 685." (2016).
15 Australian Competition and Consumer Commission v Dukemaster Pty Ltd [2009] FCA 682; [2009] ATPR 42-
290