Business Law | Qantas Airlines
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Added on 2020-03-23
Business Law | Qantas Airlines
Added on 2020-03-23
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Business LawAssessment[Pick the date]Student Name, Id
Question 1 Issue The issue is to offer a legal advice to Qantas Airlines on the account of the delivery of theordered air plane’s entertainment system which contains only 34 channels instead of 36 channels.LawAt the pre-contractual stage, both the parties are involved in the negotiation of the contractualterms and duties. Also, one party has extended various representation related to the contract andthe other party relies on these representation and decide whether to enter into the contractualrelation. Those representations which are mentioned into the contract are termed as terms andbreach of these kinds of terms would result violation of contract. In this case, the innocent partycan sue the defended and recover the damages1Further, the breach of term would be based on the fact that whether the term is a warranty orcondition of the contract. Condition is an imperative clause of the contract. As per the judgmentgiven in Poussard v Spiers2 case, the plaintiff can revoke the contract only when the conditionhas been breached by defended. However, it is essential to note that in case of warranty this isnot feasible. It means the party can sue the other party on the account of breach of warranty butcannot revoke the contract under Bettini v Gye3 case. According to the exclusion clause, the liability of the defended would be minimized on theaccount of breach of any term only in the following aspects. When the defendant has notified the plaintiff in relation to the exclusion term. Further, it isnoteworthy that exclusion clause that one party has made after the enactment of the contract1Andy Gibson, Douglas Fraser, Business Law (Pearson Publications., 8th e, 2014) 2Poussard v Spiers (1876) 1 QBD 4103Bettini v Gye (1876) 1 QBD 1831
would not be considered as valid clause as evident from Thornton v Shoe Lane Parking4andOlley v Marlborough Court5 case. It is imperative that the respective exclusion clause must not be used against the plaintiffespecially when the defendant has made false claim or misrepresentation. It is the essential that defendant communicates to the other party regarding the insertedexclusion clause. However, if the party has informed related to the exclusion clauses to otherparty and the party does not read the clauses due to negligence, then also the exclusionclauses would be valid. Therefore, it limits the liability of defended party.Application It is apparent from the case facts that Airbus Corporation Ltd and Qantas Airlines have enacted acontract regarding the purchase of an airplane. The contract contains 545 terms and some of theterms are highlighted below:Term 56 – Plane must be in position to travel for 10,000 km with a rate of 800 kmphTerm 455 – Aircraft must have entertainment section with 36 channels Further, after the enacted of the contract, Airbus Corporation Ltd has sent number of documentsalong with the contractual form to Qantas Airlines. One of the documents also containslimitation of liability regarding the breach of contract. However, due to confusion, wrongsoftware has been installed in the entertainment system and hence, it shows only 34 channels. Itis apparent that term of contract (the system should has 36 channels) is a warranty consideringthe underlying importance. Hence, Qantas can sue Airbus Corporation Ltd for breach ofwarranty. Qantas has the legal rights to claim for the damages but cannot cancel the contract. Inregards to the defendant liability, it is apparent that exclusion clause would not be applicablehere because Airbus Corporation Ltd has provided the exclusion clause after the enactment of thecontract. Hence, the clause would not be enforceable as per the judgment of Olley vMarlborough Court [1949] 1KB 532. Therefore, Qantas has the legal rights to recover thedamages from Airbus Ltd. Conclusion 4Thornton v Shoe Lane Parking [1971] 1 All ER 6865Olley v Marlborough Court [1949] 1KB 5322
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