Business Law Assignment: Contract Law and Consumer Rights

This business law assignment analyzes a case involving King Song Pty Ltd and a consumer's right to a refund. The assignment delves into contract law principles, examining the elements of a valid contract, including offer, acceptance, and consideration. It explores the validity of an exclusion clause printed on a concert ticket, referencing the cases of Pharmaceutical Society of Great Britain v Boots Cash Chemists and Thornton v Shoe Lane Parking. Furthermore, the assignment discusses Australian Consumer Law, specifically section 18 regarding misleading and deceptive conduct, and the remedies available to consumers. The analysis considers cases like Singtel Optus Pty Ltd v Australian Competition and Consumer Commission and eBay International AG v Creative Festival Entertainment Pty Limited to determine whether the company's actions were misleading. The conclusion determines whether the consumer, Dee, is entitled to a refund based on the invalidity of the exclusion clause and potential breaches of consumer law.

Running Head: BUSINESS AND CORPORATION LAW 0
Business Law Assignment
4/9/2019
Student’s Name

Business Law Assignment 1
Contents
Question 1........................................................................................................................................2
Issue 2
Rules 2
Application 3
Conclusion 4
Question 2........................................................................................................................................5
References........................................................................................................................................7

Business Law Assignment 2
Question 1
Issue
The issue of the case is to decide whether Dee has the right to take the refund of tickets from
King Song Pty Ltd. or not.
Rules
Under contract law, every contract is required to have certain elements are there such as offer,
acceptance, legality, consideration, the intention of the parties and capacity
(Australiancontractlaw.com, 2019). Here it is necessary to state that there is a difference between
offer and invitation to treat. An invitation to treat is simply an invitation of offers. In reply to an
invitation to treat, an offer comes. It was held in the case of Pharmaceutical Society of Great
Britain v Boots Cash Chemists [1953] 1 QB 401 that goods displayed in shelves are an invitation
to treat and not the offer. When a customer takes the drugs out of shelves and takes the same to
the chemist, it considers as an offer and then after chemist by providing medicines and drugs
provides his/her consent (Dobson & Stokes, 2012). Apart from offer, acceptance is also must. It
can be made via various modes but when parties choose postal mode postal rules becomes
applicable. According to these rules, an acceptance seems to be complete as soon as party place
the acceptance enter to post.
Unfair terms are one of the areas of contract law, which is necessary to discuss here. One of the
most common types of the unfair term is exclusion clause. As the name implies, the exclusion
clause is a statement by making the same, parties of the contract limit their liability in respect to
one or more factors (Legalvision.com.au, 2019). People can use exclusion clauses oppressively

Business Law Assignment 3
and therefore law limits the use of such terms. There are many rules related to the validity of the
exclusion clause and such clauses are required to be introduced according to these cases,
otherwise the same can be held invalid. In those cases where an exclusion clause held invalid, the
party who inserted such clause becomes liable for the liability excluded. While discussing the
validity of the exclusion clause, the case titled Thornton v Shoe Lane Parking [1971] 2 WLR 585
Court of Appeal is an important one to discuss. In this case, the claimant faced an injury in the
car park because of the partial negligence of the defendant. The claimant received a ticket on
which it was mentioned that the terms and conditions stated inside the car park would rule the
contract of parking. According to these terms, the car park owner was not liable for personal
injuries arising out of negligence. In the decision of the case, the court held that the exclusion
clause was not valid. For the validity of the exclusion clause, it is necessary that the same should
come into notice of the party at the time or before the time of development of the contract
(Poole, 2019). The ticket has been generated when claimant put the money inside the machine
and at the same moment, the contract has been developed. Claimant could read the exclusion
clause only after entering into a contract. This is the reason that the clause was not valid and the
defendant held liable to pay the damages for personal injury accrued out of negligence.
Application
In the presented case, the company named King Song Pty Ltd (King Song) was promoting the
singing festival. This company published an advertisement in the newspaper. A person named
Dee Major seen the advertisement in the newspaper and becomes interested to join the event.
According to the advertisement, one could join the event by paying $300 via credit card or bank
transfer. Further, the event was going to organize on 1st June 2019 presenting Australia’s top
internationally renowned tenor, Barry Tone. Dee being a big fan of Barry transferred this amount

Business Law Assignment 4
to company’s bank account. On transfer this amount, Dee received her ticket from King song by
the way of post. The ticket had the name of the concert and an exclusion clause. According to
this clause if Barry would be unable to perform at ‘Singapore with Barry’, then another tenor of
equal standing will perform and King Song will not give any refund. Afterward, as on 01st
March, Barry emailed Leo, director of King Song that he will not be able to perform at
‘Singapore with Barry’. On receipt of this mail, Leo started searching another Australian Tenor
but ended up searching a New Zealand Tenor. Leo made the contract with New Zealand tenor
and informed to all the ticket holders regarding the change in performer including Dee. Dee
asked the refund of the ticket she brought. In order to check whether Dee is able to ask for a
refund of not, the validity of the exclusion clause is required to understand. Firstly, applying the
provisions of the Pharmaceutical Society of Great Britain v Boots Cash Chemists the
advertisement presented was an invitation to treat and not the offer. Sending the money to buy a
ticket was on offer and as soon as King Song Pty Ltd posted the ticket, the contract was made
between the company and Dee. Exclusion clause was printed on the ticket that Dee received after
the development of the contract. Applying the provisions of Thornton v Shoe Lane Parking, the
subjective exclusion clause was not valid as it came into knowledge of the party after the
development of the contract. Dee was not aware of the same while entering into a contract. The
contract developed by Dee was a valid contract as all the essentials such as offer, acceptance,
consideration, legality, capacity, and intention to create legal relation were there.
Conclusion
As exclusion clause inserted by King Song Pty Ltd was not valid, therefore the King Song Pty
Ltd is liable for breach of contract and has to refund the amount of ticket to Dee.

Business Law Assignment 5
Question 2
Apart from Contact Law, Australian Consumer Law also provides a certain right to the
consumer. Here this is necessary to state that a is a consumer if the same acquire services or
goods less than $40000. Section 18 of Australian Consumer Law prescribes the provisions
related to misleading and deceptive conduct. The section says that a person during trade or
commerce a person must not engage in conduct, which is misleading or deceptive in nature.
There are many remedies for misleading conduct which includes an injunction, damages,
rescission of the contract and many others. The tern misleading does not require the intention of
fraud. Misleading and false advertising are also covered by this legislation. Subsection 1 of
section 18 says that three elements must be there to establish a breach of section 18. The first
element is the person must do conduct. The second requirement is that the conduct must be
related to trade and commerce and at last, the conduct must be of misleading or deceptive nature.
As per the provisions of this section, businesses should not make false or misleading claims. It is
important to know that the behavior of business affects the impression of consumers regarding
good or services. In cases of misleading or deceptive conduct, this is necessary to check whether
the overall impression generated by the conduct is inaccurate or false. Sometimes it is required
by the businesses to disclose some additional information to consumers in order to avoid
engaging in deceptive or misleading conduct. In other words, this can be stated that businesses
should share all the information, which are important for consumer or can change their opinion
regarding the purchase of the same (Accc.gov.au, 2019). Singtel Optus Pty Ltd v Australian
Competition and Consumer Commission [2012] FCAFC 20 is the lead case to discuss here. In
this case, an internet company stated ‘unlimited’ while advertising its download plans for users

Business Law Assignment 6
but later on it was found that the unlimited plans were subject to certain other elements that the
company did not present to consumers (Austlii.edu.au, 2019). Court held that the action of the
company was misleading as a consumer could change their decision if aware of the true
situation. Another important case study is Scalping Protection Misleading and Deceptive - eBay
International AG v Creative Festival Entertainment Pty Limited [2006] FCA1768 where the
court held that parties cannot rely on the conditions that have not brought into the attention of
another party at the time of development of the contract (Burrows, 2013). In the presented case,
King Song did the same. At the time of developing the contract, the company did not make it
clear that the singer could be changed. Further applying the decision given in the case of Singtel
Optus Pty Ltd v Australian Competition and Consumer Commission, the advertisement presented
by King Song will be treated as misleading. As mentioned above, the intention is irrelevant for
the purpose of the term misleading, King Song misled the consumers. They could change the
decision of buying tickets if aware of the true situation. Further as given in the case of Scalping
Protection Misleading and Deceptive - eBay International AG v Creative Festival Entertainment
Pty Limited, King Song should have stated all the conditions related to price and refund at the
time of development of contract but as the same did not do this, the company cannot rely on
conditions later on. As mentioned above that, remedies can be in various forms when a seller
breached section 18 and hence Dee may sue King Song for the refund of tickets.

Business Law Assignment 7
References
Accc.gov.au. (2019) Advertising and selling guide. [Online] Available from:
https://www.accc.gov.au/accc-book/printer-friendly/29527 [Accessed on 11/04/19]
Austlii.edu.au. (2019) Singtel Optus Pty Ltd v Australian Competition and Consumer
Commission [2012] FCAFC 20 (7 March 2012) [Online] Available from:
http://www.austlii.edu.au/cgi-bin/sinodisp/au/cases/cth/FCAFC/2012/20.html?
stem=0&synonyms=0&query=full%20federal%20cour%20optus%20commission%202012
[Accessed on 11/04/19]
Australian Consumer Law
Australiancontractlaw.com. (2019) Formation. [Online] Available from:
https://www.australiancontractlaw.com/law/formation.html [Accessed on 11/04/19]
Burrows, M. (2013). Are your website terms and conditions contractually binding? [Online]
Available from: https://www.dundaslawyers.com.au/are-your-website-terms-and-conditions-
contractually-binding/ [Accessed on 11/04/19]
Dobson, A., P. & Stokes, R. (2012) Commercial Law. London: Sweet & Maxwell.
Legalvision.com.au. (2019) What Are Exclusion and Limitation of Liability Clauses? [Online]
Available from: https://legalvision.com.au/australian-consumer-law-affect-exclusions-
limitations-liability-clauses/ [Accessed on 11/04/19]
Pharmaceutical Society of Great Britain v Boots Cash Chemists [1953] 1 QB 401
Poole, J. (2019) Textbook on Contract Law.UK: Oxford University Press.

Business Law Assignment 8
Scalping Protection Misleading and Deceptive - eBay International AG v Creative Festival
Entertainment Pty Limited [2006] FCA1768
Singtel Optus Pty Ltd v Australian Competition and Consumer Commission [2012] FCAFC 20
Thornton v Shoe Lane Parking [1971] 2 WLR 585