Case Study: Contract Law Principles in Construction Disputes

This case study delves into two distinct scenarios involving contract law principles within the Australian legal system. The first scenario revolves around Sarah and Nerve Constructions, where Sarah seeks a construction deal from her friend James. The analysis focuses on whether a contract was formed based on their email exchanges, examining the elements of offer, acceptance, consideration, and intention to create legal relations. The second scenario involves Bartle Constructions Pty Ltd and All Rock Pty Ltd, questioning the validity of consideration in their agreement for concrete pumping services. It also explores who Geelong City Council could sue for delays caused by incorrect concrete pumping, considering contractual obligations and potential breaches. The case study requires applying relevant legal principles and providing well-defined explanations of legal elements to determine the outcomes of these disputes.

ASSIGNMENT TASK
Managing legal risk requires the ability to apply abstract legal principles to real life scenarios. In the
assignment below you are to apply the legal principles learned in this unit to answer the questions
posed.
In particular, you should:
A. Apply relevant legal principles of the ‘Introduction to the Australian Legal System’ and ‘Principles of
Contract Law’ topics in this unit.
B. Provide relevant definitions of legal elements as required.
1. Sarah and Nerve Constructions
Sarah owns a large block of land in Sandringham on which she wants to build a modern single story
dwelling. Sarah’s friend James is the Director of Nerve Constructions and Sarah is hoping to be offered a
cheap deal. Sarah sends an email to James that reads:
“James!
Why did I not think about this before!? Do you think Nerve could design and build my new place in
Sandy?
My budget is somewhat limited. I couldn’t spend more than $300,000 for the whole thing.
Let me know if this is doable and we could get the ball rolling.
Thanks, Sarah”
James received Sarah’s email, and sent his own email in reply. It stated:
“Hey Sarah,
We usually don’t do fixed price contracts for less than $350,000. But for you, I’m willing to take it on for
$310,000 for design and build.
Assuming this is fine please find attached our standard form contract for completion.
Happy to help!
James”
Sarah never returned the contract. In fact, a week after her initial email she signed an agreement with
Build It! Pty Ltd to build the house for $300,000. James, assuming everything was fine, had already spent
$15,000 getting preliminary architectural drawings for the build.

Eventually, James called Sarah to see why the written contract wasn’t returned. This is when he learned
Sarah had gone elsewhere. “Well, you will have to pay us for the money wasted on this already”, James
said. “But we never agreed on anything!” Sarah angrily replied.
QUESTIONS:
 Assuming James and Sarah cannot resolve this dispute on their own, where could James apply to
get compensation for the money he spent? (20 marks)
 What do the terms “design and build” and “fixed price” mean? (10 marks)
 Has a contract been formed in this scenario? In your answer define and apply each of the contract
formation elements learned in class. Ensure you define each element. (30 marks)
(Offer,acceptance,,consideration,intension)
2. Bartle Constructions Pty Ltd and All Rock Pty Ltd
Bartle Constructions Pty Ltd (BC) is the head contractor for a large civil project. BC were engaged by
Geelong City Council following a competitive tender process. BC engages All Rock Pty Ltd (AR) to provide
concrete pumping services for the project.

BC and AR have a long history working together on large-scale projects. AR agrees to provide the
services for free in exchange for BC ‘keeping them in mind’ for future projects.
A few weeks into the project it was found that the concrete slab had been poured incorrectly and would
need to be completely redone. This has delayed the completion of the project by several weeks.
QUESTION:
• Does the contract between Bartle Construction Pty Ltd and All Rock Pty Ltd contain valid
Consideration? (10 marks)
• Who could Geelong City Council sue under Contract Law for the delay caused by the incorrect
concrete pumping? Explain your answer. (20 marks)
Requirements
 Excellent definitions of legal elements are provided with clear, detailed and logical order.
 Excellent application of legal principles to the given scenarios. All information is
appropriate for the given task

 An excellent conclusion is provided for each legal question and supported by
comprehensive analysis.
 Report is well formatted to workplace standard, and appropriate to information, minimal
or no spelling or grammatical errors. Correctly referenced.