Case Study: Legal Analysis of a Renovation Contract Dispute

This case study analyzes a legal dispute arising from a renovation contract. Peter and Mary sought quotes for timber flooring, leading to an agreement with James. The analysis focuses on whether Peter and Mary have legal rights against James due to issues with workmanship and potential negligence. The assignment examines the application of contract law principles, including offer and acceptance, express terms, and defenses like act of God. The case also considers potential claims of negligence and defamation. The student uses the IRAC method (Issue, Rule, Application, Conclusion) to analyze the scenario, referencing relevant legal precedents. The conclusion determines the legal standing of Peter and Mary to seek remedies or damages, providing a comprehensive overview of the legal issues involved in the renovation contract dispute.

Running Head: CASE STUDY
CASE STUDY
Name of the Student
Name of the University
Authors Note

1CASE STUDY
Scenario 1:
Issue:
The issue in the case is whether Peter and Mary have legal rights or obligations
against James and Joey.
Rules:
Invitation to offer is when an intention to make an offer and negotiate the terms of the
contract has been established by the party. In other words, the offer made after the invitation
for offer is established. This includes displays in shops, advertisements, auctions, invitations
for tenders and so on.
Express Terms are the explicit terms of the contract which bind the parties legally. This
means that the express terms of the contract are the legally enforceable terms which bind the
parties and have been mutually agreed upon (BP Refinery (Westernport) Pty Ltd v Shire of
Hastings [1977] UKPC 13, (1977) 180 CLR 266, Privy Council (on appeal from Australia).).
However, such term should be lawful in nature, not contradicting then Interest of the other
person in the contract.
Non-est factum means that the contract can be revoked as void ab initio on the ground of
fundamental mistake for agreement. However, carelessness of the party to not read the terms
thoroughly shall not be covered by the doctrine (Bant 2009). This is a defense against the
enforceability of the contract wherein the intention to create the contract should be altered by
the mistake. Mere carelessness shall not render the contract as void ab initio (Lloyds Bank v
Waterhouse [1993] 2 FLR 97.).

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Negligence is the breach of duty of care owed by the defendant towards the plaintiff
leading to harm or damages to the plaintiff and hence the claim can be made for
compensation against the costs of the damages caused to the plaintiff (Donoghue v
Stevenson [1932] AC 532).
Act of God is the defense against negligence where the damages caused to the plaintiff is
due to the natural circumstances which are beyond the control of the defendant (Transco plc vs.
Stockport Metropolitan Borough Council [2003] UKHL 61). These include all natural
phenomena like rain, flood, storm, earthquake, hurricane and so on.
Defamation is making a false statement against somebody and publicizing the same to the
third party with the plaintiff having the knowledge of the false nature of the statement. Mere
opinion or negotiation or comment shall not form defamation (New York Times Co. vs. Sullivan
376 US 254 (1964)).
Application:
In the given scenario, Peter had put up the advertisement for the workmanship and hence,
it was the invitation to offer. James offered the quote and same was accepted by Peter. Joey
had also sent his offer but the offer was not received by Peter and hence, he went ahead with
James.
Rain is an act of God which is not under the control of anyone and hence, any damage
caused by it shall not be admissible for remedies against the plaintiff’s claim. The opening of
the door would not have caused the problem in normal situations. This has been expressly
stated in the facts of the case. The tool bag appears to be placed on top of the drainage. If the

3CASE STUDY
flooding was caused by the placing of the tool bag, then James can be brought under the light
of liability under the tort of negligence.
The conversation between Peter and Joey about being the cheapest quote does not imply
any disrespect or defamation to Joey and hence, there lies no liability of Peter towards Joey
for making an opinion or personal comment.
Peter and Mary are binding by the terms of the contract with James. Mere carelessness to
read the contract does not amount to revocation of the contract as void ab initio. However, to
protect the interest of the customers, the negligence of the service provider shall be covered
under the law as per the legal provisions.
Joey shall commence the work when the structure of the floor is sound and thus, Peter
and Mary have the right to claim for the recovery of damages or recovery of the floor
structure as per the standard promised by James.
Conclusion:
It can be concluded that Peter and Mary had the right to sue James for the recovery of
the floor structure or termination of contract and subsequent claim for damages.

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REFERENCES;
Bant, Elise. "Incapacity, Non Est Factum and Unjust Enrichment". (2009) 33(2) Melbourne
University Law Review 368
Donoghue v Stevenson [1932] AC 532
Transco plc vs. Stockport Metropolitan Borough Council [2003] UKHL 61
New York Times Co. vs. Sullivan 376 US 254 (1964)
BP Refinery (Westernport) Pty Ltd v Shire of Hastings [1977] UKPC 13, (1977)
180 CLR 266, Privy Council (on appeal from Australia)
Lloyds Bank v Waterhouse [1993] 2 FLR 97