Melbourne Builders vs. Sydney Paintworks: A Contract Law Case Study

This case study analyzes a contract dispute between Melbourne Builders and Sydney Paintworks concerning the redecoration of a new office premise. The core issue revolves around the elements of a legally binding contract, including offer, acceptance, capacity, consideration, and intention. The case examines the exchange of quotations, the terms and conditions set by both parties, and the subsequent delay in completing the work due to unforeseen circumstances. The analysis delves into the key terms of the contract, the nature of the dispute, and the likely outcome based on the enforceability of the terms and conditions. It highlights the importance of clear communication and written agreements in contract formation, particularly regarding timelines and potential breaches. The case concludes with a discussion of the legal implications of the dispute, considering the acceptance of offers and the impact of the delay on the contract's enforceability. The analysis also references relevant legal literature to support the arguments presented and to provide a comprehensive understanding of the legal principles involved.

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CASE STUDY
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Melbourne Builders vs Sydney Paintworks
Analysis
In every legally binding contracts, there must be five essential aspects to make one
complete. These aspects include an offer, acceptance, capacity, consideration, and intention
to carry out a contract successfully. The case presents a call for quotation for redecoration of
a new office premise acquired by Melbourne Builders to Sydney Paintworks Ltd. In the
quote, the firm required the work to be completed by 1st March in a letter dated 4th January
wherein a terms and condition on the essence of time where the firm is a liberty to terminate a
contract not undertaken within the set time.
A quote is submitted by the paint workers on 6th January and a revised one on 13th
January of $7000 and $7800 respectively. Each of the quote bore a term and condition on an
allowance of up to 10 day working which does not amount to breach of contract agreeing on
a 50 percent pay upfront and the rest on completion. An acceptation of offer of 6th January is
offered by the Melbourne builders accepting terms stipulated by the paint company. A $3900
payment requested by the paint firm was sent on 5th February hence beginning the works.
Fried (2015) notes that such unclear aspects lead to challenges and possible delays at the time
of implementation of contracts. No formal agreement is received from the other side on
acceptance of the said deliberations but the contract sets off thus leaving room for a tussle
once the time of completion delays.
Question 1
Elements of the Contract
The contract entails elements of offer and acceptance as well as the terms and
conditions of each party working together. The contract entailed an offer, acceptance, written
document on one side and discharge by performance. The contract involved an invitation to
contract and a counter offer on the price for the work stipulated. However, in its last stage,

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there was no written agreement between the two where sending of request for deposit and
progression of task took place.
Question 2
The Key Terms and Conditions of the Contract
The contract involves terms and conditions on the side of the team seeking for service
and the team offering the said service. One side states that time is of essence and any task not
completed within the specified time gives the firm offering the work the right to terminate a
contract. On the other side, the Paint Works firm has a terms and condition stating While
every effort will be made to carry out work within agreed timescales, a delay in completion
of up to 10 working days is not to be regarded as a breach of contract.’
Thus, the terms for the Sydney Paintworks allow for 10 more days to carry out a task
on top of the stipulated one in a contract which has to be accepted by the person in need of
service. On the other hand, Melbourne Builders consider time as of essence where a contract
has to be carried out in time. However, it accepts the offer placed by the firm thus justifying
acceptance on the 10 more days as written behind the quotation card. The main contestation
in the case arises in the difference on the two which were not solved before the actual
implementation of the task began. Therefore, each had to work with the terms stipulated but
the practicality could only be affirmed with either party in the case they accepted an offer in
written.
Nature and Point of Dispute
The point in the case arises where the Sydney Paintworks employees delayed the task
completion due to illness thus leading to the incomplete nature of the paint job by 2nd of
March. As a result, Melbourne Builders according to its terms and condition on the essence
of time decided on termination of the contract and seek for compensation on the breach of
contract. The cause of the delay seems natural and one that does not totally amount to the

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mistake of the paint firm. In the long run, it delayed the actual completion of the task
estimated to have been complete by the 1st of March according to the agreement placed by
Melbourne Builders. As a result, the firm sought to terminate the contract on the grounds that
the team implementing the task failed to deliver according to its required timings as stipulated
in its terms and conditions while seeking for a quote.
Likely Outcome of the Case
The case entails a cross-examination of the terms and conditions and whether the
deliberations therein were enforced into law by the elements of the contract. In this, it shall
look at the offer and acceptance and whether terms and conditions were made clear to each
party as well as the actual signing of the contract as a legal binding (Bayern 2015). In the
case, Sydney Paintworks are likely to win and the other party lose on the case. An offer in a
contract comes with terms and conditions where each member has to sign and agree before
the implementation of a contract.
On one side, the Melbourne Builders accepted the offer placed by Sydney Paintwork
and specified on the acceptance of the first quote placed on 6th. Therein was a term and
condition on the back of the quote which clearly specified that ‘While every effort will be
made to carry out work within agreed timescales, a delay in completion of up to 10 working
days is not to be regarded as a breach of contract.’ According to the contract which was
perceived to be completed in a weeks’ time from the expected day of completion, the ten
days specified had not elapsed thus placing the paint firm on the right side of the law. Since
Melbourne Builders read and understood the quote form, it is expected that their acceptance
to the offer agrees that an extension of ten days would be comfortable for them (O’Leary
2017).
However, there was no formal communication on acceptance of the terms of
condition offered by Melbourne Builders to Sydney Paintworks. At no point in the case are

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we told of an acceptance on the offer placed thus does not hold the other party liable to the
terms and conditions expressed. According to Knapp, Crystal and Prince (2016), such issues
lead to lack of clarity in contracts which might escalate to legal contestations. The lack of
written communication on the side of the paint works team indicates no legal binding
agreement on the terms and condition stipulated by Melbourne Builders. However, the
acceptation to offer a part payment amounting to more than half of the amount expected on
the 6th Jan offer stipulates agreement to the terms and conditions of offering half of the pay
but which coincides with the later offer of $7800 (Tan 2015).
In the case, breach of contract can only materialize if the Sydney Paintworks made an
agreement or acceptance to the counter offer placed by the Melbourne Builders. In the case,
we are only informed of Melbourne sending an acceptance to the 6th Jan offer where further
communication between the two entities led to an agreement on the stat date of the work and
no further agreement on the terms and conditions set. According to O'Sullivan and Hilliard
(2016), such a contract can be breached as there is no legal binding holding each party in
written. Melbourne would have a win on their side if it countered the terms and condition of
the quotation placed by the paint firm and asked for a review or automatic disqualification of
the firm (McKendrick 2014). The fact that it accepted and sent back an acceptance puts them
on the losing side as their offer was not accepted in written but rather had a conversation
leading to the beginning of task.
In another scenario, while seeking compensation for the final work, Sydney
Paintworks would be defeated in seeking to enforce full payment for the total of $7800 sent
in the second quote. A contract cannot be said to be complete if the terms and conditions
were unclear where in the case each party is expected to seek for clarity on issues deemed
contestable (Osterland and Rose 2017). While the firm received half of the sum requested in

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their second quote, the written notice in acceptance of the offer clearly stipulated acceptance
of the 6th Jan offer which amounted to $7000.
If an agreement is not reached in such a case, a decline to an offer is expected, a fact that
failed to occur in the given case. According to Bodansky (2016), not every provision of a
legal instrument necessarily leads to a legal obligation. Each party went on to carry their part
of the assignment where one paid for the task and the other began to implement the
deliberations. Thus, it is evident that Melbourne Builders will lose the case to Sydney
Paintworks on the grounds of lack of a legally binding agreement signed after acceptance and
offer stage of a contract (Wilkinson-Ryan and Hoffman 2015). A partial agreement and
documentation shall act as a factor of lose for one of the party.

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Reference
Bayern, S., 2015. Offer and Acceptance in Modern Contract Law: A Needles Concept. Cal.
L. Rev., 103, p.67.
Bodansky, D., 2016. The legal character of the Paris Agreement. Review of European,
Comparative & International Environmental Law, 25(2), pp.142-150.
Fried, C., 2015. Contract as promise: A theory of contractual obligation. Oxford University
Press, USA.
Knapp, C.L., Crystal, N.M. and Prince, H.G., 2016. Problems in Contract Law: cases and
materials. Wolters Kluwer Law & Business.
McKendrick, E., 2014. Contract law: text, cases, and materials. Oxford University Press
(UK).
O’Leary, L., 2017. Introduction. In Employment and Labour Relations Law in the Premier
League, NBA and International Rugby Union (pp. 1-18). TMC Asser Press, The Hague.
Osterland, T. and Rose, T., 2017. Correctness of Smart Contracts for Consistency
Enforcement. ERCIM NEWS, (110), pp.18-19.
O'Sullivan, J. and Hilliard, J., 2016. The law of contract. Oxford University Press.
Tan, V., 2015. Unfair Contract Terms. Australian Commercial Law, p.380.
Wilkinson-Ryan, T. and Hoffman, D.A., 2015. The common sense of contract formation.
Stan. L. Rev., 67, p.1269.