Commercial Law: Negligence and Australian Consumer Law

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

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Answer 1
Part 1
Issues
The case is inclusive of two particular issues where the primary issue is that whether
Ann can claim anything against Salami manufacturer with respect to the Section 54 and 138
of the Australian Consumer Law. The second issue is that whether Ann can claim any right
against Supermarket Pty Ltd.
Relevant rules
This case can be solved by deliberating the issues and provisions that are listed in the
Law of Tort and the Australian Consumer Law. The consumer law states that it ensures the
goods and products that are being sold in the market, which needs to be supplied provided
that it is safe from the minor defects and can be majorly accepted in the market by the
customers. In the Competition and Consumer Act 2010 section 54 states that the goods need
to be in acceptable standards that are being sold in the market (Abraham, 2017). The section
also highlights that the quality of the goods needs to be acceptable when the supplier provides
the goods to the customers in trade or commerce. The section also highlights that the goods
need to be fit and should be of acceptable quality so that it can help in serving the purposes
for which the goods are being supplied. In this regards, the goods have to be of a quality that
can be acceptable in the market. The consumer also needs to be acquainted regarding the
representation and other circumstances regarding the good that is being made by the
manufacturer or supplied by the supplier. The clause 4 in this particular section states that the
goods that are given to the consumers are not of an acceptable quality, then the reason needs
to be stated regarding the inability to comply with the provision needs to be bought to the
attention of the consumer. The case ACCC v Valve Corporation (No 3) [2016] FCA 106

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stated that the court help the section 54 of the consumer law that is applicable in this case. In
Norton v Hervery Motors Ltd 1996, the District Court states that the quality of the goods that
will be accepted can only be determined through the consumer test with respect to the factors
that are present in section 7(1).
In addition to this, section 138 of the Competition and Consumer Act 2010 states that
action can be taken against the supplier or the manufacturer for the loss or damage that is
suffered by the person for a good that has defects in its safety features. It is also stated that
the manufacturer is liable to compensate the person for the defect and the injuries that have
been suffered by the customers for those particular defects that are present in the product. The
consumer can also recover the damages that has been suffered for the manufacturer if the
safety defects were a case of wrongful acts. The Australian Consumer Law has also given
power to ACCC to issue notices so that the information regarding the production of the
products can be issued. The penalties on breaching the provision can increase to $220,000
AUD for an individual for each contravention (Levine et al., 2016).
The act of negligence can be analysed with the help of a case known as Donoghue v.
Stevenson [1932] All ER 1, in which it was stated that the negligence act can lead to injuries
to the person or property in a careless manner. The failure of the person in obliging the duty
to care to another person will be deemed as a committed negligence. The individual so also
liable to the injury that is foreseeable and the plaintiff has suffered due to the act.
With respect to the case of Bolton v Stone [1951] AC 850 there is a likelihood that the
harm that was caused to the person was analysed by the court. If the person suffered injury by
the plaintiff, then the perpetrator was liable in breaching the duty.

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Application
With respect to this case, it can be stated that there is a case of negligence on behalf of
Smallgoods Pty Ltd. The company produces meat products that are processed in nature and
they need to be careful regarding the particular batches that are being sold in the market. The
products need to undergo special treatment so that it can be free from bacteria. The product
that Ann purchased and later consumed it was not treated for bacteria process, which made
the product contaminated. This was a negligence that was caused on behalf of Smallgoods
Pty Ltd., as they did not perform the duty in a proper manner that resulted in poor health of
Ann. The duty to care was breached under section 54 of the Competition and Consumer Act
2010. The product had failed to meet the guarantee towards the customer with respect to the
safety of the product.
Therefore it has been identified that there was a breach of duty to care and the goods
of acceptable quality by the manufacturer Smallgoods Pty Ltd. who can be held liable under
section 138 of the Competition and Consumer Act 2010. The company sold goods that were
of unacceptable quality, which resulted in ill health of Ann. Thus, the duty of the company is
that if the product cannot meet the standard of acceptable quality, they need to provide reason
for that to the consumer. The company had failed in doing that and the damages are to be
provided by Smallgoods Pty Ltd to Ann.
Conclusion
Therefore it can be concluded that the company has been negligent in supplying the
goods that can meet the acceptable quality.