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The Contract Negotiation | Assignment

   

Added on  2020-04-01

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COMMON LAWSTUDENT ID:[Pick the date]
The Contract Negotiation | Assignment_1
COMMON LAWQuestion 1IssueThe critical issue here is to determine whether the statement made by Samantha about thechair being best in the market is a term or representation.Relevant RuleDuring the contract negotiation, a host of statements are made. Some of these subsequentlybecome contractual terms while the others remain mere representations. In order todistinguish between the two, the following four factors need to be taken into consideration.Parole evidence rule: As per this rule, if the contract is written, then only the writtenclauses would be classified as contractual terms and those which are essentially oral onlyare classified as representations1.Relative expertise of the representor: In accordance with this, the greater the knowledgepossessed by the representor in the context of the product or service being represented, thehigher is the chance of the underlying statement being a term rather than representation ashighlighted in the verdict of Dick Bentley v Harold Smith Motors2case. It is essential thatthis expertise of representor is measured on the basis of the expertise of the representee3. Statement overall importance and reliance by the representee: When the representeeindicates to the representor the significance of the statement, then it becomes highly likelythat the same would be considered as a term in accordance with the verdict of Bannermanv White4case.Timing: The shorter the time elapsed between the statement being made and contractbeing entered, the higher the likelihood for the statement to be considered a term in linewith the decision undertaken in Routledge v Mckay5case.Application & ConclusionFor the given case, the parole evidence rule is not applicable as the contract for buying ofchair is essential oral. Considering that Samantha is a representative of the furniture1Andy Gibson, Douglas Fraser,Business Law(Pearson Publications., 8thed, 2014)2Dick Bentley v Harold Smith Motors[1965] 1 WLR 6233Callie Harvey,Foundations of Australian law(Tilde University Press, 3rded, 2009)4Bannerman v White(1861) 10 CBNS 8445Routledge v Mckay[1954] 1 WLR 615
The Contract Negotiation | Assignment_2
COMMON LAWcompany, hence it would be fair to expect that her knowledge about the quality of chairswould be significantly superior in comparison with that of Peter. Further, based on thedescription given, it is apparent that Peter decides to buy the chair as soon as Samatha makesthe claim of being the best and available at a ‘cheap price’ of $ 350. Based on the aboveevidence in totality, it can be concluded that the statement made by Samantha would becategorised as a term since later after use Peter did find out that the chair given was not thebest one. Hence, there was a misrepresentation of a fact.Question 2IssueThe central issue is to determine if the statement made with regards to the chair providingadequate support to the lower back of Peter for all day long can be classified as a term or not.Relevant RuleIn order to decide whether there has been a breach of the contract or not, it is essential tooutline whether a statement made during contract negotiation is a term or is restricted tobeing a mere representation. While the four factors which are relevant to differentiatebetween the two have been outlined above, the key factor which needs to be highlighted hereis the overall importance and reliance of the representee on the same.A leading case in this regard is Bannerman v White6. In this case, the claimant entered into acontract for purchase of hops which were for the purpose of beer making. The claimantbefore making the purchase had made it clear that the hops needed to be treated with sulphuror else he would not buy the same. The defendant assured him that the hops were sulphurtreated while in reality they were not. The claimant sued the seller and the court held thatconsidering the importance of hops being sulphur treated for the buyer, it would beconsidered as a term to the contract7. 6Ibid.47Robert Bryan Vermeesch, Kevin Edmund Lindgren,Business Law of Australia(Butterworths, 12thed. 2011)
The Contract Negotiation | Assignment_3

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