Business Law Assignment: Theatre Contract and Potential Claims

This business law assignment analyzes a case study involving Robert and a theatre. Robert purchased tickets for a musical, expecting a specific actor. The actor's unavailability and a subsequent flood led to show cancellations. The assignment examines potential claims Robert may have against the theatre, considering breach of contract, the essentiality of the actor's performance, and the concept of frustration of contract due to the flood. It also explores the impact of vicarious liability if the flood was caused by the negligence of a theatre employee. The assignment references Australian Contract Law and relevant case laws to support its conclusions, determining whether Robert is entitled to a refund or damages under different scenarios. The analysis covers breach of contract, frustration, and vicarious liability, providing a comprehensive legal assessment of the situation.

business law assignmenT

ASSIGNMENT 1
Contents
Scenario 1...................................................................................................................................2
Issue.......................................................................................................................................2
Rules......................................................................................................................................2
Application............................................................................................................................2
Conclusion.............................................................................................................................2
Scenario 2...................................................................................................................................3
Issue.......................................................................................................................................3
Rules......................................................................................................................................3
Application............................................................................................................................3
Conclusion.............................................................................................................................3
Scenario 3...................................................................................................................................4
Issue.......................................................................................................................................4
Rules......................................................................................................................................4
Application............................................................................................................................4
Conclusion.............................................................................................................................4
References..................................................................................................................................5

ASSIGNMENT 2
Scenario 1
The actor Alfonso Pereira is not available and Robert tries to cancel the contract
Issue
The issue in the given case study is to analyse if Robert has the right to demand refund from
the theatre in the situation when the actor Alfonso Pereira is not available.
Rules
According to the Australian Contract Law, a contract denotes an agreement between parties,
which creates legal obligation for them for the performance of specific acts. The essential
elements that lead to the creation of a legal contract are the agreement, consideration,
capacity of the parties, intention to create legal relations, and certainty of the terms. It must
be also noted that terms of the contracts denotes the details of the agreement between the
parties, which are made during the course of negotiations, and can be in express form or
implied form, as stated in case law of Ecay v Godfrey [1947] 80 Lloyds Rep 286. The
essential term when agreed, and consented by the parties, renders the agreement the character
of contract. In addition, it must be noted that the common law provides right to terminate a
contract when there is a breach of an essential term of the contract; or there is a sufficient and
grave breach of non-essential term or there is a repudiation of the contract.
Application
The following points must be noted on the application of the rules to the given case study.
Robert had purchased the ticket of the theatre on the condition of the performance of the
Sancho Panza musical. Essentially the performance by the actor Alfonso Pereira in the
leading role was the essential condition of the contract between Robert and the theatre,
because the same was told to Robert and was agree upon by him at the time of purchasing of
the ticket. Thus, it can be stated that failure of the performance by Alfonso Pereira was
breach of the essential condition of the contract. Further, the breach of the essential condition
of the contract facilitates the innocent party the right to repudiate the contract, and to
claiming damages, as held in the case law of Associated Newspapers Ltd v Bancks (1951) 83
CLR 322; [1951] HCA 24.

ASSIGNMENT 3
Conclusion
Thus, discussions conducted in the previous parts lead to the conclusion that since the
performance of Alfonso Pereira was essential condition and the same is breached, Robert is
entitled to claim of damages or the get the refund of the tickets.
Scenario 2
Flooding of theatre and cancellation of the show
Issue
The issue in this scenario is to analyse the status of the contract between Robert and the
theatre on occurrence of the flood and the right of Robert to claim the refund of tickets.
Rules
As stated in the Australian Contract Law, the discharge of the contract can also take place
through the frustration of the contract. The frustration of the contract occurs when the either
of the parties are not at fault, yet the circumstances of the contract render the incapability of
the contractual obligation or the deprivation of the contract of its commercial purpose. The
concept is applicable only when the event reduces performance of the contract, which is
something vitally altered from what was estimated by the parties (Clarke, 2010). The
principle of frustration was held in the case of Nicholl and Knight v Ashton, Eldridge & Co
[1901] 2 KB 126. Additionally one of the essential conditions in the said breach is that each
of the party is discharged of its future obligations if the contract is found to be frustrated, as a
result, there is no power to sue for the breach with each of the parties.
Application
The application of the law on the given scenario leads to the following observations. It is
stated in the scenario, that the night before the show was about to be performed, the theatre is
flooded with flood, because of the bursting of the water main in the road outside the theatre.
The said event is out of control of both the parties and none of the parties are at fault for the
cancellation of the show that follows. Further, as stated in the contract law, when the contract
is discharged through frustration, the parties cannot sue each other for the enforcement of the
contract, in this case for the refund of the amount of the tickets of the show.
Conclusion
Hence, the conclusion can be reached from the discussion in the previous parts that as none
of the parties are at fault including theatre authorities because of the frustration of the

ASSIGNMENT 4
contracts; Robert is not entitled to claim the refund of the tickets for the cancellation of the
show in this scenario.

ASSIGNMENT 5
Scenario 3
Flooding of theatre due to the fault of the cleaner of the theatre, and cancellation of the
show
Issue
The issue in this scenario is to analyse the status of the contract between Robert and the
theatre on occurrence of the flood, as the cause of the flood is the caused by the mistake on
the part of the cleaner. Further, the issue is to analyse whether the refunds can be claimed in
this scenario.
Rules
One of the important concepts of the Contract Law is the vicarious liability. Vicarious
liability is referred to as the imposition of the liability on the employer for the negligence of
the employee in the performance of a task, during the course of employment (Ryding and
Reisz, 2016). Further, the vicarious liability has two characteristics. First is the liability for
the negligence of another and secondly, the imposition of the strict liability. The concept of
the vicarious liability on behalf of the negligence of the employee is in addition to the
primary liability of the employer (Goudkamp & Plunkett, 2017).
Application
On application of the law of vicarious liability, following observations are noteworthy. The
show is cancelled due to the occurrence of the flood in the theatre. However, it must be noted
that the flood was caused due to the negligence of the cleaner. As the cleaner was cleaning
the premise and smoking simultaneously, he was unable to turn off the sprinklers that were
set off by the smoke. The failure to shutting down the sprinklers led to the flooding of the
theatre and the failure of the show to take place. Although, the cancellation of the show is not
due to the fault of the theatre owners or breach of an essential condition of the contract
between the theatre and Robert, yet the liability occurs in form of vicarious liability. As the
cleaner was performing the task in the due course of his employment, the owners of the
theatre would be vicarious liable for the acts done by the cleaner.
Conclusion
Hence, as per the discussions conducted in the previous parts, it can be stated that the owners
of the theatre have vicarious liability for the acts of the cleaner and further cancelation of the
show. As a result, owners would be liable for the said breach of the contract due to

ASSIGNMENT 6
negligence of the cleaner and Robert can claim the refund of the amount of the tickets in the
said scenario.

ASSIGNMENT 7
References
Associated Newspapers Ltd v Bancks (1951) 83 CLR 322; [1951] HCA 24
Clarke, J. (2010). Discharge by Frustration [online] Available from:
https://www.australiancontractlaw.com/law/termination-frustration.html
Ecay v Godfrey [1947] 80 Lloyds Rep 286
Goudkamp, J. & Plunkett, J. (2017) Vicarious liability in Australia: on the move?, Oxford
University Commonwealth Law Journal, 17 (1).
Nicholl and Knight v Ashton, Eldridge & Co [1901] 2 KB 126.
Ryding, A. and Reisz, L. (2016) Australia: The High Court clarifies the law regarding
employers' vicarious liability for an employee's wrongful acts. [online] Available from:
http://www.mondaq.com/australia/x/533772/Health+Safety/The+High+Court+clarifies+the+l
aw+regarding+employers+vicarious+liability+for+an+employees+wrongful+acts [Accessed
on: 27/04/2019].