RMIT LAW2497/2477 Commercial Law: Legal Principles and Case Analysis

This assignment solution provides a comprehensive overview of various aspects of commercial law, including the application of the Banking, Finance and Insurance Award 2010, indictable offenses under the Crimes Act 1958 (Vic), and the functions of the Competition and Consumer Act 2010. It also discusses the advantages and disadvantages of operating a business franchise and the role of the Franchising Code of Conduct. Furthermore, it reflects on the student's learning experience, highlighting how the study of legal processes has enhanced decision-making skills and provided insights into leadership and business. The assignment addresses misconceptions about the legal system, such as the necessity of written agreements between friends and the protection offered by registering a business name, emphasizing the importance of shareholder agreements and trademark registration. The student references various legal cases and acts, demonstrating a thorough understanding of the subject matter.

Running head: COMMERCIAL LAW
COMMERCIAL LAW
Name of Student
Name of University
Author Note

1COMMERCIAL LAW
Folio 1
10 A.
 As a graduate of a Financial Planning Program I will most likely be working in
the finance industry.
 Banking, Finance and Insurance Award 2010 applies to the finance industry
 The purpose of an award is to cover employers, employees and labor hire
businesses covered under the classifications descriptions.
 An employment contract can be defined as a written or verbal agreement between
an employer and employee setting out terms and conditions of employment.
 The pay rate for a level 6 position in the finance industry is $28.49 per hour and
$1082.50 per week
 Grice Slaughterhouse cannot pay me under this pay rate as the level 6 is described
as middle managerial role that primarily to control conduct of part of employer’s
business. As a financial planner I will have level 5 position (Fair Work, 2019).
Folio 2
8.
 Turner is likely to be charged with section 17 of the Crimes Act 1958 (Vic)
 Indictable offense can be defined as a crime serious enough to be tried on
indictment attracting punishment of imprisonment of more than one year up to life
or even death penalty.
 If found guilty beyond reasonable doubt Turner may face level 4 imprisonment
that is imprisonment up to a term of maximum 15 years.
 Turner could not be charged with same offence under the Victorian law if the
action took place in NSW as both the states have different legislations.

2COMMERCIAL LAW
Folio 3
17
The Competition and Consumer Act 2010 was passed by the Parliament of Australia to
replace the Trade Practices Act 1974. The Act is being administered by the Australian
Competition and Consumer Commission (ACCC). The Australian Consumer Law (ACL) is set
out in the Schedule 2 of the act. The function of the Competition and Consumer Act 2010 is to
give fair and competitive operating environment to businesses. The act covers issues relating to
anti-competitive conduct, price fixing, unconscionable conducts and various other issues like
advertising. Another function of the Act is to set out consumers’ rights and responsibilities by
covering issues like returns, refunds, warranties, contracts, marketing and advertising.
The conducts that contravenes the ACL are described in the section 18 of the Act.
According to the Australian Consumer Law conduct can be defined as ‘doing or refusing to do
any act that includes making of or giving effect to a provision of and understanding or the
requiring of the giving of or the giving of a covenant.’ Section 18 states that a person in trade or
commerce should not engage in misleading or deceptive conduct any conduct that is likely to be
misleading or deceptive. The important elements required in this section for misleading or
deceptive conduct are that the conduct was done in trade or commerce, the conduct was in all
circumstances misleading and deceptive, the claimant had been relying on the conduct and the
claimant because of his reliance to the conduct suffered a loss.
Examples of cases that were in contravention of the schedule 2 of the Competition and
Consumer Act 2010 are- ACCC v Ultra Tune Australia Pty Ltd [2019] FCA 12, ACCC v ACM
Group Limited (No 3) [2018] FCA 2059, ACCC v Employsure Pty Ltd ACN 145 676 026.

3COMMERCIAL LAW
In the case ACCC v Ultra Tune Australia Pty Ltd [2019] the Federal Court of Australia
held Ultra Tune Australia to be in breach of the Franchising Code of Conduct 2014 (Cth) and
sections 18 and 29(1) of the Australian Consumer Law and explained the level of information
needed to be included in the financial statements of franchisors that they need to provide to
franchisees.
In ACCC v ACM Group Limited the Federal Court found the company to be engaging in
misleading and deceptive conduct, harassment, coercion and unscionable conducts.
In the case ACCC v Employsure Pty Ltd the company was held liable for its engagement
in misleading conduct in breach of the Australian Consumer Law, and unscionable conduct
towards small businesses.
Folio 4
22A.
There are various advantages and disadvantages of operating a business franchise. The
advantages of business franchise are-
 Reduction of risk of business failure
 No need for market testing as the products would already have a market share
established.
 Support from franchisor
 Prior experience not needed
 Exclusive rights
 Easier business financing

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 Established relationships with suppliers
 Benefits from using a recognized brand name and trade mark.
For the above mentioned advantages there are certain disadvantages of franchising as well.
This disadvantages are-
 Higher costs
 Restrictions on business related decisions
 Franchisor monitoring may become intrusive
 The franchisor may go out of business
 Sell of franchise only approved by franchisor
 Profits are shared with franchisors
 Inflexible in nature.
22B
The Franchising Code of Conduct is defined as a mandatory industry code regulating the
conducts of franchising participants towards each other. The code sets out various rules for
franchising participants, provides mechanisms to resolve franchising disputes, reasons for ending
agreements, regulations regarding investigation of breach of the code, penalties and
infringements for the breach of the code (Franchising code of conduct, 2019). The code was
introduced to establish standard of business practice in franchising, to provide information and
education about franchising, to educate about issues on the relevant sector, to develop a
financially strong franchising sector (Franchising Council of Australia, 2019).

5COMMERCIAL LAW
Folio 5
 The study of the legal process in this institute will help me with my decision
making skills among other qualities needed for insights into leadership and
business. I got an in depth knowledge about the aspects of all the laws that
govern the businesses and other commercial operations. The course has helped in
knowledge towards identifying all the risks that a business might face and also the
knowledge to mitigate the risks. The study has also given me an insight on the
concepts of business law and to analyze each concept critically. The course has
increased my strategic thought process, my written communication skills,
knowledge of the legality of commercial transactions and the rights and duties of
individual involved in business.
 Before pursuing the study of contract in this institute I had no idea about the
Postal Rule of the Contract law. The knowledge about the rule was both
unexpected and surprising to me. In contract law postal rule can be defined as a
rule making exception to the general rule that an acceptance can be created by
communicating directly to offeror. In this type of rule Acceptance is effective as
soon it is posted.
 Like many other people I also had some misconceptions about the legal system
before starting the course that has changed with time by the end of the course.
The first misconception I had was that business between friends does not need
any written agreement. During the course studying various cases this
misconception of mine was broken. I learned that to avoid any dispute it is always
necessary to create a partnership or shareholders’ agreement outlining the

6COMMERCIAL LAW
structure, ownership matrix and expectations of the parties. The second
misconception I had was that a legal document can only be written by a lawyer.
But the course taught me that there is no such legal requirement for drafting a
document by a lawyer. Any person can draft their own agreements. The drafts
made by the lawyers are made following an already made template. The third
misconception I had was that just registering the business name is enough to
protect a brand. To have complete right over the brand name it is important to
have a trademark registered. Using a business name does not grant a person
“common law’ right to the name. Another misconception I believed was that a
shareholder agreement is only applicable for large corporations. This course
helped me remove that misconception. I learned that although it is not legally
binding but except a sole trader or a partnership business a shareholder agreement
is incredibly important. The agreement provides mechanisms for dispute
resolutions and resolving issues arising in the day-to-day operations of the
business. The shareholder agreement anticipates the issues before they occur and
sets out the measures to fix them.

7COMMERCIAL LAW
Reference
Crimes Act 1958 (Vic)
Competition and Consumer Act 2010
Trade Practices Act 1974
ACCC v Ultra Tune Australia Pty Ltd [2019] FCA 12
ACCC v ACM Group Limited (No 3) [2018] FCA 2059
ACCC v Employsure Pty Ltd ACN 145 676 026
Franchising Code of Conduct 2014 (Cth)
Fair Work (2019). Welcome to the Fair Work Ombudsman website. [online] Fair Work
Ombudsman. Available at: https://www.fairwork.gov.au/ [Accessed 15 May 2019].
Franchising code of conduct (2019). Franchising code of conduct. [online] Australian
Competition and Consumer Commission. Available at:
https://www.accc.gov.au/business/industry-codes/franchising-code-of-conduct [Accessed 15
May 2019].
Franchising Council of Australia (2019). Franchise Council of Australia. [online] Franchise
Council of Australia. Available at: https://www.franchise.org.au/ [Accessed 15 May 2019].