1. Copyright  2003 McGraw-Hill Australia Pty Ltd. PPTs t/a Fundamentals of Business Law 4e by Barron & Fletcher. Slides prepared by Kay Fanning. Copyright © 2000 McGraw-Hill Australia This is the prescribed textbook for your course. Available NOW at your campus bookstore!

2. Copyright  2003 McGraw-Hill Australia Pty Ltd. PPTs t/a Fundamentals of Business Law 4e by Barron & Fletcher. Slides prepared by Kay Fanning. Contract Law Part 3 Chapter 9

3. Copyright  2003 McGraw-Hill Australia Pty Ltd. PPTs t/a Fundamentals of Business Law 4e by Barron & Fletcher. Slides prepared by Kay Fanning. Copyright © 2000 McGraw-Hill Australia 9-2 Express terms of contract statements (made throughout negotiations) Dependant upon: Time statement made Form of statement Special skills and expertise being relied upon Intention of parties, resulting in Mere representationTerm of contract (collateral contract)

4. Copyright  2003 McGraw-Hill Australia Pty Ltd. PPTs t/a Fundamentals of Business Law 4e by Barron & Fletcher. Slides prepared by Kay Fanning. Copyright © 2000 McGraw-Hill Australia 9-3 Express terms of contract statements (made throughout negotiations) Resulting in Mere representationTerm of contract No damages BREACH Damages WarrantyCondition i.e. term of vital importance TEST: Did party enter contract because of term? NO YES Damages Damages Rescinds contract

5. Copyright  2003 McGraw-Hill Australia Pty Ltd. PPTs t/a Fundamentals of Business Law 4e by Barron & Fletcher. Slides prepared by Kay Fanning. Copyright © 2000 McGraw-Hill Australia 9-4 Conditions Precedent condition: A term that must be satisfied before the contract can be enforced. Subsequent condition: Term of contract that will terminate the contract due to an event, or act of a party to the contract, occurring.

6. Copyright  2003 McGraw-Hill Australia Pty Ltd. PPTs t/a Fundamentals of Business Law 4e by Barron & Fletcher. Slides prepared by Kay Fanning. Copyright © 2000 McGraw-Hill Australia 9-5 Implied terms By Courts (Officious Bystander Test) Reasonable and equitable Contract ineffective otherwise So obvious didn’t need to be included Clearly expressible Not contradictory to other terms By Statute Law Trade Practices Act 1974 (Cwlth) By Custom or Trade Usage Certain, reasonable, notorious Not contradictory to express terms Not contradictory to statutory restrictions

7. Copyright  2003 McGraw-Hill Australia Pty Ltd. PPTs t/a Fundamentals of Business Law 4e by Barron & Fletcher. Slides prepared by Kay Fanning. Copyright © 2000 McGraw-Hill Australia 9-6 Exemption and exclusionary terms Ticket Cases Test: Is exemption clause a term of the contract? (Reasonable Person Test) - Receipt (No exemption) - Document with contractual terms (exemption). Notice of clause before or at time contract is made. Non-Ticket Cases Exemption clause is a term of the contract. Notice of clause before or at time contract is made.

8. Copyright  2003 McGraw-Hill Australia Pty Ltd. PPTs t/a Fundamentals of Business Law 4e by Barron & Fletcher. Slides prepared by Kay Fanning. Copyright © 2000 McGraw-Hill Australia 9-7 Doctrine of privity on contract Only parties to a contract can sue or be sued on the contract. Exceptions Insurance Contracts Act 1984 (Cwlth) Person(s) acting as agent or trustee Person assigning rights and liabilities to another

9. Copyright  2003 McGraw-Hill Australia Pty Ltd. PPTs t/a Fundamentals of Business Law 4e by Barron & Fletcher. Slides prepared by Kay Fanning. Copyright © 2000 McGraw-Hill Australia 9-8 Discharge of a contract Performance Agreement between parties Provision for discharge Operation of law Frustration Breach

10. Copyright  2003 McGraw-Hill Australia Pty Ltd. PPTs t/a Fundamentals of Business Law 4e by Barron & Fletcher. Slides prepared by Kay Fanning. Copyright © 2000 McGraw-Hill Australia 9-9 Discharge of contract Performance Actual Tender (attempted performance)

11. Copyright  2003 McGraw-Hill Australia Pty Ltd. PPTs t/a Fundamentals of Business Law 4e by Barron & Fletcher. Slides prepared by Kay Fanning. Copyright © 2000 McGraw-Hill Australia 9-10 Discharge of contract Agreement Cancellation of original agreement Mutual Discharge Both parties agree to end the contract Release Party can release other party from obligations Substitution of a new agreement Novation Replaced by new contract involving third party Accord and satisfaction Release one party for new agreement with further consideration

12. Copyright  2003 McGraw-Hill Australia Pty Ltd. PPTs t/a Fundamentals of Business Law 4e by Barron & Fletcher. Slides prepared by Kay Fanning. Copyright © 2000 McGraw-Hill Australia 9-11 Discharge of contract Provision for discharge Options to terminateConditions subsequent

13. Copyright  2003 McGraw-Hill Australia Pty Ltd. PPTs t/a Fundamentals of Business Law 4e by Barron & Fletcher. Slides prepared by Kay Fanning. Copyright © 2000 McGraw-Hill Australia 9-12 Discharge of contract Operation of law Bankruptcy Material alteration Merger

14. Copyright  2003 McGraw-Hill Australia Pty Ltd. PPTs t/a Fundamentals of Business Law 4e by Barron & Fletcher. Slides prepared by Kay Fanning. Copyright © 2000 McGraw-Hill Australia 9-13 Discharge of contract Provision for discharge Options to terminate Conditions cubsequent

15. Copyright  2003 McGraw-Hill Australia Pty Ltd. PPTs t/a Fundamentals of Business Law 4e by Barron & Fletcher. Slides prepared by Kay Fanning. Copyright © 2000 McGraw-Hill Australia 9-14 Discharge of contract The occurrence of the event must not be the fault of either party The frustrating event must make performance of the contract radically different from what was agreed by the parties An event that is unforeseen must occur The frustrating event must occur after the contract has occurred

16. Copyright  2003 McGraw-Hill Australia Pty Ltd. PPTs t/a Fundamentals of Business Law 4e by Barron & Fletcher. Slides prepared by Kay Fanning. Copyright © 2000 McGraw-Hill Australia 9-15 Discharge of contract Breach AnticipatoryRenunciationImpossibilityActual during of performance performance

17. Copyright  2003 McGraw-Hill Australia Pty Ltd. PPTs t/a Fundamentals of Business Law 4e by Barron & Fletcher. Slides prepared by Kay Fanning. Copyright © 2000 McGraw-Hill Australia 9-16 Remedies Condition Right to rescind Specific performanceDamages (reasonably foreseeable) Injunction Quantum meruit Ordinary Normal Exemplary (mitigate losses)

18. Copyright  2003 McGraw-Hill Australia Pty Ltd. PPTs t/a Fundamentals of Business Law 4e by Barron & Fletcher. Slides prepared by Kay Fanning. Copyright © 2000 McGraw-Hill Australia 9-17 Specialty contracts Lease One party grants exclusive possession of property to another party for a period of time. Hire purchase The owner of goods hires the goods in exchange for regular payments to the hirer. Title passes after all payments have been made. Franchise agreement Agreement between a supplier of a product or service, or an owner of a trade mark or copyright (Franchisor), and a reseller (Franchisee).

19. Copyright  2003 McGraw-Hill Australia Pty Ltd. PPTs t/a Fundamentals of Business Law 4e by Barron & Fletcher. Slides prepared by Kay Fanning. Copyright © 2000 McGraw-Hill Australia 9-18 Franchise agreement Franchise agreement - A marketing tool and means by which, through a contract, the franchisor grants the right to a franchisee for the use of: - a product - services - a trade mark - copyright, etc.

20. Copyright  2003 McGraw-Hill Australia Pty Ltd. PPTs t/a Fundamentals of Business Law 4e by Barron & Fletcher. Slides prepared by Kay Fanning. Copyright © 2000 McGraw-Hill Australia 9-19 Advantages For franchisor (seller) Ability to penetrate markets quickly Access to capital resources Risk sharing For franchisee Instant reputation Arranged marketing Financial expertise Established business

21. Copyright  2003 McGraw-Hill Australia Pty Ltd. PPTs t/a Fundamentals of Business Law 4e by Barron & Fletcher. Slides prepared by Kay Fanning. Copyright © 2000 McGraw-Hill Australia 9-20 The franchising code of conduct Disclosure document Cooling-off period Copy of lease Association of Franchisees Prohibition of general release from liability Transfer of the franchise Termination of a franchise Resolution of disputes

22. Copyright  2003 McGraw-Hill Australia Pty Ltd. PPTs t/a Fundamentals of Business Law 4e by Barron & Fletcher. Slides prepared by Kay Fanning. Copyright © 2000 McGraw-Hill Australia 9-21 Trade Practices Act 1974 (Cwlth) Part IV Section 45: Exclusionary Provisions Section 46: Monopolies Section 47: Exclusionary Dealing Section 48: Resale Price Maintenance Part IVA Section51AA: Unconscionable Conduct Part V Section 52: Misleading and Deceptive Conduct