Business Law Assignment - BLAW 3100, Fall 2018, BC, Analysis

This document presents a solved Business Law assignment from the Fall 2018 session of BLAW 3100. The assignment addresses several key areas of business law, including the distinction between terms and representations in pre-contractual statements, the right to sell goods, the enforceability of non-compete agreements, and breach of contract under the Sale of Goods Act. It also covers exclusion clauses, the formation of contracts, unconscionability, and the intention to create legal relations. Each question is analyzed, applying relevant legal principles and providing conclusions based on the facts. The document includes a bibliography with the Sale of Goods Act as a reference.

Business Law Assignment
Business Law Assignment
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business Law Assignment 1
Question 1
Issue: Whether a pre-contractual statement is a term or a mere representation.
Rule: Where one party relies on the statement made by the knowledgeable party, the statement is
interpreted as a term. Where the statement is the other party uses its own judgement in deciding
whether to enter into the contract or not. The satements are interpreted as mere representations as
the other party do not rely on them in changing the position.
Application: The seller clearly stated that he had no knowledge on when the guitar was
manufactured. In this case, it was up to me to examine whether I should buy it or not. The fact
that I decided to buy it without knowing the model was an independent decision that was not
induced by the seller’s statement.
Conclusion: There is no remedy as the misrepresentation did not cause reliance. The seller
already stated that he had no knowledge regarding the model, but I decided to buy it anyway.
Question 2
Issue: Right to sell.
Rule: There is always an implied condition in all contracts of sale that every seller of goods can
only sell goods that he/she owns. The seller must have the right to transfer title of the goods
before they pass to the buyer. Where the goods were stolen, the seller would be in breach of these
terms and the goods would be returned back to the true owner as the true owner still retained the
title. The person who stole the goods must then return all the money to the buyer and cannot
charge for any benefit the buyer had earned before the goods were recovered.
Application: Cheryl had no right to sell the tractor, and therefore the ownership did not pass to
John. Also, Cheryl cannot charge any amount on the days the tractor was used.

business Law Assignment 2
Conclusion: Ownership of the car did not pass to John since Cheryl had no right of ownership,
and no right to sell. John should get back all the money.
Question 3
Issue: Enforceability of non-compete agreement.
Rule: In an agreement for the sale of the business, a non-compete agreement is valid unless the
seller provides grounds for its exemption. These grounds are a long duration and different
geographical location. In most cases, the courts find it reasonable for a non-compete to extend to
five years especially the one that involve a sale of business.
Application: A duration of five years limitation on Janine would seem reasonable to court for a
limitation. Also, the one-mile radius is reasonable for a limitation.
Conclusion: The limitation is valid and Janine cannot put up a similar business for up to 5 years
within a one-mile radius.
Question 4
Issue: Breach of a sale agreement.
Rule: Where a contract is breached, the innocent party can elect an action suing the other party
for breach and claim for the damages. In section 49 of the sale of goods act. The acts state that
“49 (1) Where the seller wrongfully neglects or refuses to deliver the goods to the buyer,
the buyer may maintain an action against the seller for damages for non-delivery.”(1)
Subsection (2) provides that the damages to be recovered by the buyer are those resuling directly
from the breach (1). Under subsection (3), the buyer can get the goods from the market and then
sue for the difference in price (1).

business Law Assignment 3
Application: Under section 49, Marion should sue for the breach of contract and claim the loss
that directly arises from the breach. She can also get the drawing from the market and sue for
price difference.
Conclusion: Marion should sue for breach of contract.
Question 5: The answer is B
Question 6: There is a standing rule that the exclusion clause must be incorporated in the
contract. Limitation or exclusion clauses cannot be added to the contract when it has been
executed.
Question 7: There was no binding agreement since the parties agreed on some but not all
matters. The only reequipment was that both parties should negotiate good faith over the
remaining mattes of the program. In addition, there was no obligation that the future negotiations
were to end into a legally binding agreement.
Question 8: The contract was unenforceable on the basis of unconscionability. The principles of
unconscionability bar one party into a contract from attaining its benefit if one of the parties was
weak, and there was a proof of inequality in the bargaining power.
Question 9: In law, there is always an intention to create a legal relationship in business contexts
unless there come grounds for rebutting this presumption. The main grounds for the exemption
of this presumption is that the parties already had a written agreement not to enforce the
agreement. The second grounds of rebutting the presumption is when the facts of the case
demonstrate that both parties contemplated that the negotiations were not going to result to a
binding agreement. However, for this case, Jimmy has no likelihood of rebutting assumption
because the two requirements are not available.

business Law Assignment 4
Bibliography
1. Sale of Goods Act, R.S.O. 1990, c. S.1. 1989.