Commercial Law Assignment: Comprehensive Analysis of Key Legal Areas

This commercial law assignment provides a comprehensive analysis of key legal areas. It begins with an examination of the Sale of Goods Act, addressing contract formation, property transfer, frustration of contract, and compliance with descriptions in sales. The assignment then delves into the Consumer Guarantees Act 1993, exploring acceptable quality, remedies for defective goods, and the application of caveat emptor. The analysis further extends to the Fair Trading Act, focusing on misrepresentation, unsubstantiated claims, and misleading conduct. Finally, the assignment considers employment law, covering grounds for dismissal, procedures for sexual harassment cases, and misconduct. The assignment uses various case studies and legal principles to explain the concepts.

Running head: COMMERCIAL LAW
Commercial Law
Student Name
Name of university
Author note

1COMMERCIAL LAW
Answer 1 – Sale of Goods
A. The Sale of Goods Act was implemented to monitor all transactions that amount to
sale. Sale however is limited to that of goods and the quality and quantity of the same.
The act extends its application to establishing what are the rights and obligations of
the buyers and sellers.
B.
i. In a contract for Sale of Goods it is essential to establish definite terms of the
contract in terms of price, quantity, mode of transaction and all other
requirements under Section 3. Having fulfilled all the criteria, it is a valid
contract under Section 5.
ii. As per provisions of the Act the property rests with the seller until possession
is transferred. In this instance though Lisa does an act for Paul to make the
product deliverable as per Section 20 Rule 2, Paul has no knowledge of the
same. The absence of knowledge of fixing the window ensures that the
property is still owned by Lisa.
iii. The given instance is one of frustration of contract and applying Section 9
provides that when a good perishes without fault of wither the seller or buyer
the agreement can be avoided. As per Section 22 the seller is responsible for
the goods till they are transferred to the buyer. Lisa must therefore bear the
loss and is no longer compelled to fulfil the contract with Paul
C. As the current situation stands Angus has made no payment and as per Section22 all
the risks still lie with the seller of the goods, that is Samantha. Section 9 also ensures
that when the subject matter of the sale perishes the contract comes to an end due to
frustration or force majeure (Bridge 2017). Also, the case of Taylor v Caldwell has
established the concept of impossibility which arises is situations like this. As the
contract stands annulled all the loss is borne by Samantha.
D. The Sale of Good Act ensures that when sales are made on the basis of description,
whether the same is made through an advertisement or by a sales agent the goods
subsequently delivered must comply with such description – section 15. The
description must also ensure that it is reflective of the quality of the good and fits the
purpose for which it is to be used. On seeing the advertisement Jo ordered for
Amphitrite Soybean Oil, the delivery made was for lubricating oil. As Jo had relied on

2COMMERCIAL LAW
the description of the advertisement only he can reject the delivery as it does not
comply with it applying the principle set in Harlingdon V Christopher (1900).
E.
i. The principle of unjust enrichment ensures that even when a contract is
frustrated the same should not allow one person to benefit from it while
another suffers. This principle was established in Fibrosa Spolka Akcyjna v
Fairbairn Lawson Combe Barbour Ltd. Therefore, Carpetland Ltd must
reimburse Charles for any payment made by him.
ii. There is no distinction between this instance and the first, despite the store
making express provision for Charles. As there is no delivery of the good the
responsibility still lies with the seller under Section 22. The loss of the amount
that Charles pays to Carpetland must be borne by them.
iii. Continuing the concept of unfair enrichment, the destruction of the
Supasystem is only detrimental to RJEL as they allow their customers to trial
products, they give the same with faith and expect them to take care of the
same. Pat must pay RJEL $5000 for the loss that he has caused them.

3COMMERCIAL LAW
Answer 2 – Consumer Guarantees Act 1993
a) The act applies to all instances of sale of goods and services. Goods must be of
acceptable quality and adhere to their description while services should be carried out
by skilled and responsible individuals. The act does not apply to goods and services
obtained for business purpose and those taken from charitable institutions. The act
applies to all instances of online sale, including auctions by websites.
b) A distinction needs to be established between the goods purchased from NML and
Warren as they differ in their characteristics. The act does not apply to second-hand
goods unless the same are bought from a second-hand dealer which Warren is not,
therefore Alex has no remedy for the life jackets.
Section 7 of the act lists durability and safety as one of the essential elements of
acceptable quality, ss the yachts are unsuitable for sailing and can cause accidents and
death the same fails to fulfill the requirements of a durable good. Alex can receive
redressal under Section 18 and 19 and has several remedies against NML. He can
claim a refund as the goods are beyond repair or ask for a replacement. The option
that NML picks is their prerogative but what holds true is that Alex is entitled to
remedy under this Act as his guarantee has been violated.
c) i. The general rule of caveat emptor or let the buyer beware does not apply in
situations where the buyer relies on the expertise of the seller and specifies to him the
intention behind making the purchase. Here as Sarah was relying on Bob’s expertise
and description of the good and bought the paint he suggested under Section 9 the
store must remedy the situation.
ii. Sarah had bought the paint relying on the description made by the sales agent of the
store and therefore the store is liable to either refund the cost of the paint or replace
the same and to give a product that is more suitable.
iii. It is the duty of the store to provide speedy remedy when they have failed to
comply with the guarantee of description. As they fail to do so Sarah can purchase the
paint that she thinks she needs and claim that cost from the store under Section 18.
iv. even if there was no paint that worked on rimu wood, the store had to provide that
information to Sarah instead of misguiding her. In such an instance the store should
refund the money that Sarah has spent on the paint as per provisions of Section 19.

4COMMERCIAL LAW
d) As the Freezit starts to leak just after a month it does not fulfil the durable condition
of acceptable quality under Section 7. As durability depends on the nature of goods it
is not normal for an appliance like Freezit to malfunction only after a month’s use.
Lucky can approach AFL for a repair, refund or replacement. However, as the Freezit
was not purchased for Lucky’s personal use but for the office in his house and the
clients, it does not fall within the parameters of this act. The act only extends to goods
and service obtained for personal use.

5COMMERCIAL LAW
Answer 3 – Fair Trading Act
1. Under the Fair Trading Act Section 9 explicitly provides that a manufacturer by
conduct should not make false or misleading representations. These representations as
per Section 13 can happen about the nature and characteristics of the good, like the
product claims to be 100% New Zealand Merino Wool but is in fact made of 85%
Australian Merino and 15% Polyester and in terms of origin, where the product claims
to be manufactured in New Zealand but in reality, is made in China.
In these two regards there has been a violation or breach of the provisions of the act
by Ice Country Limited.
2. A.a) The issue lies in the misrepresentation of the place of origin of the product and
the unsubstantial claim made of ‘significant weight loss within three months’. This
claim is made without proper evidence or research.
b) Section 12A of the Act along with Section 13 apply to this situation. The company
has violated Section 13 by making a false and misleading representation as to the
place of origin of the product which in fact is a laboratory in South Auckland and not
USA. They have also made an unsubstantial claim, that is not based on evidence and
is a blatant and untrue claim, made with the intention of misleading the customers.
B. Keen is liable for making a statement that is nothing but an unsubstantial claim
under Section 12A, and just made to attract customers as he has no expertise or
knowledge if he can actually make all his clients lose at least 1 kilo in a week.
There is also misrepresentation involving his skill and expertise and the clients that he
has trained in the past violating Section 13. Thereby with the current advertisement
Keen would become liable under Section 40-42 of the Act.
3. Food Storage with such a notice at its entrance is misleading their customers and
making false claims on the nature of the products that are available in their store. The
notice specifies the nature, quality and characteristic of the goods that are available in
their store, when in fact this is untrue as this description does not extend to all the
goods in the store and is therefore violative of Section 13 of the Act leading to a
breach of the Act by the store.

6COMMERCIAL LAW
Answer 4 – Employment Law – Dismissal
Case 1
1. The grounds of dismissal in any employment must relate to the work done by an
individual, their performance and quality of work, misconduct or related factors. Hans
was dismissed as a result of decline in his performance despite notice and warning of
the same. The reason for the dismissal being genuine and reasonable does not amount
to an unfair dismissal.
2. The procedure for dismissal requires adequate notice and payment of requisite salary.
The notice period depends on the period of employment and is normally 1 week for
the period that Hans has worked. Alan should have given Hans a notice for one week
instead of just claiming that they are letting him go. However, as Hans did not stay
onto complete the conversation with Alan it is not clear if Alan did intend to give Han
such a notice. A written notice is a requirement for dismissal under the National
Employment Standards.
Case 2-
Sexual harassment in the workplace falls within the Sex Discrimination Act 1984 and is
defined in the same. The obligation of TILis as follows
 Determine the procedure laid down in the Employee Code of Conduct for such
instances
 Set up a Committee for investigation
 Conduct investigation in an unbiased, professional and transparent manner
 Ensure both the parties are represented in the investigation and have an
opportunity to be heard
 Check all the related evidence and past complaints and behaviour of the concerned
employees
 After evaluating the evidence and witnesses submit an informed decision before
the Board
 If Sextus is found to be guilty they can ask Lucretia to file a complaint with
Australian Human Rights Commission, following Richarson V Oracle she can
receive a compensation amount for the suffering caused to her
 They can additionally terminate Sextus
 If Sextus is found innocent they can claim compensation from Lucretia

7COMMERCIAL LAW
 During the procedure they must ensure that Lucretia is not victimized
Case 3-
As per Wilson the reputation of a company is vital and must be upheld by its employees.
Rob’s violation of the law has not only had a detrimental impact on th image of the company
but on his employment too His acts amount to misconduct being illegal and therefore he can
be terminated without a written notice. Misconduct though not specifically defined does
include illegal and unlawful acts. If Rob had deadlines to meet the same should have been
discussed with the employers, it is not valid to act in unlawful means even if that is allegedly
normal in the course of business. His employment for 5 years makes it mandatory for a 4
weeks written notice fir dismissal, however given the current circumstances the same does
not apply.
Case 4-
When Mary started working at the supermarket she entered a contract of employment by
conduct, as the same was not signed formally. The managers accusation that she does not
smile enough or greet customers is an unreasonable and unprofessional ground for dismissal.
Mary being in employment for less then 6 months has not completed the minimum period of
employment to be eligible for making a complaint with Fair Work Commission.
Case 5-
It is essential for all workplaces to ensure they create a safe and comfortable working
environment for their employees. In the given instance Mary cannot make the company
vicariously liable as the actions of customers does not bind the company under Sex
Discrimination Act also the other men in the company do not make any sexually
inappropriate comments but resort to gossip that is not covered by the Act. Mary’s remedy
for the sexual harassment as per McDonald and Charlesworth lies before the Australian
Human Rights Commission and the same can be made before a year is completed from when
the act was committed.
Her dismissal is unfound as there are no valid reasons, there were complaints made about her
performance, but this was 5 months back. Having been employed for three years Mary should
be given a notice in writing 3 weeks in advance. Her dismissal is unreasonable and unjust and
based on the personal grievance of the CEO.

8COMMERCIAL LAW
Answer 5- Health and Safety
1. a. The owners were fined and prosecuted as they had been negligent towards their
employees. The management had failed to provide for safety guidelines and
instructions in order to keep the employees safe and care for their health
b. While complying with the Workplace Heath and Safety requirements the employers
must as per the Regulations of 2011 -
 prepare, maintain implement emergency plans
 provide general workplace facilities
 duty to identify foreseeable hazards
 eliminate risks to health and safety
 ensure adequate training for the employees
 floors and surfaces designed for convenience of workers and maintained
accordingly
 adequate and appropriate lighting
 adequate ventilation
 control humidity levels and temperature
 maintain equipment
 workplace should be clean and safe
 all equipment should be in working order
 provide first aid
 provide personal protection equipment
 ensure proper waste management
2. a. The existing hazards are –
 unsafe working environment
 no supervision
 no training on how equipment are to be handled
 no personal protection equipment
 no fixed working hours
 no designated rest period or areas for rest
 employees overburdened
b.
Checked by – Maintenance required

9COMMERCIAL LAW
Signature and date Urgent
Proper waste management
Provide personal protection equipment
Provide first aid
Equipment in working order
Workplace clean and safe
Ventilation
Humidity levels and temperature
Appropriate lighting
General workplace facilities
Training for the employees
Emergency plans
Exits clear
Trolleys for lifting

10COMMERCIAL LAW
Reference List:
Australian Human Rights Commission Act 1986
Bridge, M. G. (2017). The international sale of goods. Oxford University Press.
Consumer Guarantees Act 1993
Fair Trading Act 1986
Fibrosa Spolka Akcyjna v Fairbairn Lawson Combe Barbour Ltd [1942] AC 32
Harlingdon & Leinster Enterprises Ltd v Christopher Hull Fine Art Ltd [1990] 1 All
ER 737
McDonald, P., & Charlesworth, S. (2019). Academic evidence on the causes,
manifestations and responses to workplace sexual harassment: Initial
submission to the Australian Human Rights Commission's National Inquiry
into Sexual Harassment in Australian Workplaces.
National Employment Standard
Richardson v Oracle Corporation Australia Pty Ltd [2014] FCAFC 82
Sale of Goods Act 1908
Sex Discrimination Act 1984
Taylor v Caldwell (1863) 3 B&S 826
Wilson, J. (2016). Employment law: A balancing act: Effective management of
workplace disrepute by employees. Ethos: Official Publication of the Law
Society of the Australian Capital Territory, (239), 38.
Work Health and safety Regulations 2011
Workplace Health and Safety Act 2011