BSBLEG415 Case Study: Analyzing Contract Law Principles and Issues

This case study assignment analyzes two scenarios related to contract law. The first case examines the concepts of offer and invitation to offer, determining whether a contract was formed between a customer and a company based on an advertisement with a pricing error. The second case explores the discharge of a contract, analyzing whether an agreement for the sale of a vehicle was fulfilled or breached, and discussing the available remedies for the aggrieved party. The analysis includes relevant case laws and legal principles, such as Brambles Holdings Limited v Bathurst City Council, R v Clarke, and others, to support the arguments and conclusions. The assignment also provides an overview of the Australian legal system and the jurisdiction of different courts for civil claims. Finally, the assignment is presented in the format of a letter to a solicitor, requesting a review of the findings.

Running head: CASE STUDY ASSIGNMENT
CASE STUDY ASSIGNMENT
Name of the Student:
Name of the University:
Author Note:

1CASE STUDY ASSIGNMENT
Email to the solicitor:
To
The solicitor,
New South Wales.
Subject: Findings related to the two cases.
Respected solicitor,
In this letter we would like you to review the findings made in the two case scenarios.
The file notes of both the cases are provided here for your kind perusal. In the first case, the
following observations were made.
a) The instant case is related to offer and invitation to offer in contract. To form an offer,
there must be an intention to create a contract. It means the willingness of the party to
enter into a valid contract with a particular person or class of persons as seen in the case
of Brambles Holdings Limited v Bathurst City Council [2001] NSWCA 61, Court of
Appeal (NSW). Invitation to offer means inviting someone unknown in public to make a
proposal in response to the invitation.
b) Contract: A contract is said to be an agreement that is legally binding as well as it
controls the rights and duties of the parties to the agreement. It is said to be a promise or
group of promises which is binding legally on the parties to it. The elements are
consideration, agreement, intention, certainty and capacity.

2CASE STUDY ASSIGNMENT
The agreement consists of offer and acceptance as seen in R v Clarke [1927]
HCA 47, (1927) 40 CLR 227. Consideration is the second element of contract which can
be anything from money to any service as seen in Woolworths Ltd v Kelly (1991) 22
NSWLR 189. In addition to this, the parties must possess the capacity of entering the
contract. Mentally impaired persons, drunks or minors lack the capacity. The parties also
must possess the intention to create a legal relation in contract as observed in Helmos
Enterprises Pty Ltd v Jaylor Pty Ltd [2005] NSWCA 235, Court of Appeal (NSW).
Lastly the agreement must be certain.
c) As per the facts of the case, Robert, the managing director advertised in catalogue that a
plasma television is for 200 $ instead of 2000$. This denotes an invitation to offer and
not an offer as this is made not to any particular party but to the public in general as
observed in case of AGC (Advances) Ltd v McWhirter (NSWSC, 1977).
Tom collected one of the catalogues and seeing the advertisement went to the store and
asked for the television. Thus it is seen that no offer is made. When Tom asked for the television,
it amounts to an offer. But, the sales assistant told him that there was a mistake in the printing
the catalogue and denied to give it for 200$. Hence, no contract was formed between Tom and
Rosella Ltd. Thus if he takes any legal step against the company, he may not be successful as
there was no contract.
d) In order to locate and analyze the instant case, firstly the topic of contract has been
understood from the course materials. Then, we understand the elements of contract; from there
offer and invitation to offer are also known. By referring the case laws and the Australian
Contract law, the facts of the case are known and issued are answered.
In the second case study, it is analyzed whether the contract can be discharged.

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The issue of instant case is how the contract has been discharged. The Rules tio be applied
for analyzing the case are discussed below.
Discharge of a contract refers to the situations by means of which a contract is ended.
When any contract is being discharged, the parties are freed from their respective obligations as
per the terms of the contract.
However, in some situations even if all the obligations are not discharged, still the contract
is said to be discharged. A contract is usually discharged by 4 ways. They are discharge by
performance of the contract, discharge by agreement, discharge by frustration and discharge by
breach of contract.
Discharge by agreement is generally two types; unilateral discharge and bilateral
discharge. Unilateral discharge occurs when one of the parties has the right to surrender. Where
one of the parties has absolutely performed his obligation of the agreement, he is under no
obligation, but he has the right to compel the other party to perform his part of the agreement. A
promise of paying certain sum of money or providing some other type of consideration in return
that the other party gave up his rights will lead to the discharge of the contract.
Bilateral discharge happens when both the parties in the contract can surrender. It occurs
when both the parties have not performed or one party has partly performed or both the parties
have part performed their obligation.
A contract when discharged by agreement, accord and satisfaction must exist. Accord
means each of the parties must have agreed to put an end to the contract. Such agreement shall
be given freely. Satisfaction refers to consideration. Both the parties shall give consideration.
When both the parties have duties continuing, then in general the consideration refers to each of
the parties giving away their respective rights as per the contract. However, problem occurs

4CASE STUDY ASSIGNMENT
when one of the parties has done his duty in the contract. In such case the party not performing
shall give consideration to bind the contract.
A close perusal of the issue of the instant case and the rules enumerated above, it is seen
that Ash Taylor has verbally agreed to buy a red Toyota Camry motor vehicle from Brook, her
friend. This leads to the formation of a contract between Ash and Brook.
Ash agreed to give a price of 10,000 dollars as consideration. She even transferred such
amount of money to the bank account as per the directions given by Brook. This showed that
Ash has performed her part of obligation of the contract. However, Brook failed to give the
decided motor vehicle to Ash. This shows that Brook had breached the terms of the agreement.
He did not perform his part of the obligations as per the terms of the contract. However, Brook
informed Ash that she wanted to retain that vehicle and instead delivered another vehicle which
is a red 1989 model of Toyota.
From the facts of the case seen above, it is seen that the agreement was not discharged by
performance as in the Cutter v Powell (1795) case, neither was it discharged by frustration or
breach of the contract. But the contract was discharged by agreement of accord and satisfaction
leading to discharge by agreement. The reason is here Ash has performed her part of obligation
whereas Brook did not. However, Brook had delivered him another vehicle to which Ash agreed
or not is unknown from the facts of the case.
Thus it can be inferred that the contract has been discharged by the agreement.
Considering the facts of the case of Ash Taylor and Brook, the most appropriate remedies
available to the client in the instant case for the breach of contract are as follows:

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There are several types of remedies available in contract law for the breach of contract of
the most appropriate and suitable for this case were damages, rescission and specific
performance. For the breach of contract, Ash can demand for damages from Brook for the breach
of contract. Such damages may include the money deposited together with the compensation for
the breach caused by Brook. This is observed in Addis v Gramophone [1909] AC 488. He may
also opt for rescission where the parties will be put to the pre contractual position as Long v
Lloyd [1958] 1 WLR 753. Here the money paid by Ash has to be returned to her. Ash can also
opt for specific performance of the contract where Ash can ask the judge to order Brook to
deliver the pre decided vehicle as seen in Cohen v Roche [1927] 1 KB 169.
The NSW local courts deal with civil matters for claims amounting to 100,000 $
maximum. There are two divisions in the local court for determining civil cases. The Small
Claims Division is authorized to hear claims of 20,000 $ maximum and the General division is
authorized to hear claims above 20000 $ upto 100,000 $. The Magistrates Court is authorized to
hear claims upto 100,000 $ whereas the District Courts can hear claims amounting to 750,000 $.
In case of claims more than 750,000 $, Supreme Court is authorised to hear it. Moreover, if the
plaintiff is not satisfied with the adjudication made by the subordinate courts, appleal to the High
Court of Australia can be made too.
Please consider the findings and make a review on them by applying the policies and
procedures followed by the frm.
Thanking you.

6CASE STUDY ASSIGNMENT
References:
Brambles Holdings Limited v Bathurst City Council [2001] NSWCA 61, Court of Appeal
(NSW).
R v Clarke [1927] HCA 47, (1927) 40 CLR 227.
Woolworths Ltd v Kelly (1991) 22 NSWLR 189.
Helmos Enterprises Pty Ltd v Jaylor Pty Ltd [2005] NSWCA 235, Court of Appeal (NSW).
AGC (Advances) Ltd v McWhirter (NSWSC, 1977).
Cutter v Powell (1795).
Addis v Gramophone [1909] AC 488.
Long v Lloyd [1958] 1 WLR 753.
Cohen v Roche [1927] 1 KB 169.