BULAW 1502 Summer 2018 Assignment: Contracts and Property Law

This business law assignment solution addresses two key legal issues: contract formation and property rights. Part A analyzes a scenario involving a potential contract between a lecturer and an astronomy expert, examining offer, acceptance, and the possibility of damages. It concludes that no enforceable contract exists due to a lack of clear acceptance and that damages cannot be claimed. Part A also analyzes whether Sharon can claim damages against Ben and whether Ben has defences against such claim. Part B focuses on a property law case, determining who has a better title to a car, considering the principles of nemo dat and the good faith of the purchaser. The analysis considers the application of case law, including Bishopsgate Motor Finance Corporation Ltd v. Transport Brakes Ltd, Greenwood v Bennett, and Shaw v Commissioner of Metropolitan Police, to conclude that Cheng has a better claim to the car.

Running head: BUSINESS LAW
Business Law
Name of the Student
Name of the University
Author Note

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Table of Contents
QUESTION A.................................................................................................................................2
REFERENCES................................................................................................................................6
QUESTION B..................................................................................................................................7
REFERENCES................................................................................................................................9

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QUESTION A
ISSUE 1
The issue is to determine whether there is an enforceable contract between Ian and Ben
and whether Ian could successfully claim damages against Ben
LAW
A valid contract needs a valid offer and a valid acceptance from both the parties involved
in the agreement. The party who asks another to carry out a work is regarded as the offeror while
the one who at the receiving end is called the offeree. The offeror must communicate his offer to
the offeree, clearly and unambiguously. There must be a clear indication that the offeror is
intending to bind himself with the offeree by way of a legally binding agreement, which could be
enforced if needed. An offer can be written as well as oral and it could be expressed as well as
implied as well. The offeror’s approach with the offer would lay down his intention towards the
agreement, as to whether he wants to be legally bound with the offeree pertaining to the specific
agreement. Once the offeree accepts an offer, it cannot be rescinded or re-negotiated by the
offeror or offeree. Some offers are made available to a mass of people, portraying as a request, to
which the interest persons make a counter-offer. This is known as invitation to treat which is to
be distinguished from an actual offer. In the Carlill v Carbolic Smoke Ball Company [1893] 1
QB 256 case, it was not an invitation to treat as there was an unambiguous offer between the
purchaser and the manufacturer, which is similar to AGC (Advances) Ltd v McWhirter (1977) 1
BPR 9454. An offer stands valid until the offeror withdraws it.

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An acceptance is just as importance as an offer as it signifies that there is a consensus
between offeror and the offeree and that the offeree has the intention to legally bind himself with
the agreement laid down by the offeror. Acceptance must be clearly communicated even if it is
not express. It can be implied and made understood by gesture and conduct. However, the silence
of the offeree towards an offer signifies denial and it automatically exhausts the offer. Therefore,
it is undoubted that an expressed rejection of an offer by the offeree signifies that the offeree is
not interested in the offer and therefore does not want to be bound by it. Additionally, an offeree
must affirm his positive intentions about the offer with the stipulated time as with lapse of time,
an offer lapses too. Nonetheless, an offeror may again present the same offer to the offeree,
though it is a complete discretion of such offeror.
ANALYSIS
In this situation, Ben offered Ian to present a lecture at a seminar. Ian rejected the offer
by an email, which stated that he has other engagement on that day, yet he might look for an
opportunity to turn up if feasible. It clearly speaks of Ian’s disinterest about the offer and that he
does not want to be form an agreement with Ben. This rejection exhausts Ben’s offer, giving him
the chance to approach other speakers. Although Ian’s email comprised of an uncertain phrase
that he might come if possible, however, a valid contract cannot be formed based on uncertainty.
Therefore, it clear that there is no agreement between Ben and Ian. When there is no agreement
between two people, there cannot be a claim for damages as well.
CONCLUSION

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Therefore, there is no enforceable contract between Ian and Ben and Ian cannot
successfully claim damages against Ben
ISSUE 2
The issue is to determine whether Sharon can claim damages against Ben and whether
Ben has defences against such claim.
LAW
The offeror must communicate his offer to the offeree, clearly and unambiguously. There
must be a clear indication that the offeror is intending to bind himself with the offeree by way of
a legally binding agreement, which could be enforced if needed. An offer can be written as well
as oral and it could be expressed as well as implied as well. . The offeror’s approach with the
offer would lay down his intention towards the agreement, as to whether he wants to be legally
bound with the offeree pertaining to the specific agreement. Once the offeree accepts an offer, it
cannot be rescinded or re-negotiated by the offeror. Sometimes, an offer requires specific person
who would be suitable for the work, in that case the offeror is supposed to present the offer to the
desired and appropriate party who could execute the work. While, acceptance must be clearly
communicated even if it is not express. It can be implied and made understood by gesture and
conduct. An expressed rejection of an offer by the offeree signifies that the offeree is not
interested in the offer and therefore does not want to be bound by it.
It is to be noted that there are several defences available for the offeror and the offeree to
ask the court to rescind the contract. one of such defence is the mistake of fact where either one

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of the parties or sometimes both are under the mistake of fact pertaining to the clauses or
requirement of the agreement. For a unilateral mistake, the contract would be voidable at the
discretion of the aggrieved party while in case of a mutual mistake of fact, the agreement would
be declared as void ab initio as it in the case of McRae v Commonwealth Disposals Commission
[1951] HCA 79.
ANALYSIS
In this situation, Ben hired Sharon in the impression that she was an astronomy expert.
The webpage of Sharon’s university erroneously mentioned that she was an astronomy expert
while she was not. Sharon, accepted Ben’s offer believing that Ben had the information that she
was an astrology expert. This proves that there has been a clear misunderstanding between the
parties due to mistake of fact. Here, Ben can defend himself from Sharon’s claim of damages
that there was prevalence of the vitiating factor of mistake of fact. However, he cannot use the
defence that the agreement between them was unwritten as an oral agreement is as valid as a
written one.
CONCLUSION
Therefore, Sharon can claim damages against Ben as Ben would be able to cite the
defence of mistake to rescind the agreement.

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REFERENCES
AGC (Advances) Ltd v McWhirter (1977) 1 BPR 9454
Carlill v Carbolic Smoke Ball Company [1893] 1 QB 256
McRae v Commonwealth Disposals Commission [1951] HCA 79

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QUESTION B
ISSUE
The issue is to identify that whether who is going to have a better title in relation to the
Car, whether Cheng or Gordon.
LAW
In the case of Bishopsgate Motor Finance Corporation Ltd v. Transport Brakes Ltd
(1949) 1 KB 322 rules regarding nemo dat principles had been discussed by the court. In this
case the court stated that in a situation where a seller not having the title of the goods have sold
the goods to a buyer who purchases the goods in good faith and the original owners claims the
goods, two principles need to be analyzed.
Firstly, common law provides a rule relating to the protection of property under which a
person cannot give a better title than they actually have to another. The other rule is in relation to
protection of commercial transaction whereby a buyer in good faith should be provided the title
of the goods. The first rule has been in place for a long time and the second rule is in place
through modifications to meet the needs of the contemporary period (Chambers, 2008).
The rules can be better demonstrated through the case of Greenwood v Bennett. In this
case it was stated by the court that a stolen car must be returned to the original owner even if the
purchaser bought the car in good faith. However in the case of Shaw v Commissioner of
Metropolitan Police [1987] 1 WLR 1332 it has been ruled that when the owner is in a position to

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verify himself the credibility of the person to whom possession is given and it can be founded
that the trust of the owner was ill founded then the title may be passed to the buyer in good faith.
ANALYSIS
The facts depict that Mary did not have any right to sell the goods to Cheng as she did not
get a valid title in relation to the car. The car had been purchased through fraud as she had
misrepresented her identity to Gordon. In this situation both principle relating to the protection of
the owner and protection of commercial transactions need to be analyzed. The application of
Greenwood v Bennett to the facts of the case would depict that Gordon can make a better claim
for the car. This is because here also there is a stolen car which must be returned to the original
owner even if the purchaser bought the car in good faith. On the other had if the rules of Shaw v
Commissioner of Metropolitan Police are applied in the situation it can be stated that Cheng has
a better claim to the car. This is because Gordon was in a position to verify himself the
credibility of Mary’s claim that she is the Mayor of Melbourne before he gave the possession of
the car to her. In this situation it would be unreasonable on the part of Cheng to ask him to give
the possession of the car back to Gordon as Gordon has stopped his right to possession by being
negligent.
CONCLUSION
Therefore, Cheng has a better claim to the Car.

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REFERENCES
Bishopsgate Motor Finance Corporation Ltd v. Transport Brakes Ltd (1949) 1 KB 322
Chambers, R. (2008). An introduction to property law in Australia.
Shaw v Commissioner of Metropolitan Police [1987] 1 WLR 1332