1. Introduction to Legal Problem Solving -
Part 5 – Case Study
Introduction to Legal Problem Solving -
Topic 5 Glenn Dennett

2. Case Study – The parties
Mavis Stewart - Our client
Kylie Berg – Mavis’ daughter
Chrissie Saranrap - Mavis’ client
Discount Lino Barn - The flooring retailer
Whitegoods World - The fridge retailer
Cake Cookers - The oven retailer

3. Legal Problem Methodology
Possible Legal Claims (Causes of Action)
What disputes are there and Who are the parties?
What is the loss?
Use IRAC Structure for each Legal Claim (Cause of Action)
What are the legal issues
What are the rules of law
How is the law applied
What is my conclusion

4. Parties Chrissie v Mavis ???? Whitegoods World v Mavis $5,500
Discount Lino Barn v Mavis
$45,000
Cake Cookers v Mavis
$8,000

5. Chrissie v Mavis Issue Rules (the Law)
Is there an enforceable contract between Chrissie and Mavis?
Rules (the Law)
Offer
Advertisements are generally not considered to be offers but, instead, invitations to treat – Boots case
Advertisements will only be considered offers if there is a clear intention to be bound – Carlill v Carbolic Smoke Ball Company
Responding to the terms of ‘price list, in clear terms, is generally considered to be an offer – Harvey v Facey
Acceptance
Silence is not capable of constituting an acceptance of an offer – Felthouse v Bindley

6. Chrissie v Mavis Application (Law to the Facts) Conclusion
Mavis had no intention to be bound by her advertisement – nothing like a bond was lodged – so no offer
Mavis only sent her price list to Chrissie – so it was up to Chrissie to respond to make the offer
As Mavis never received Chrissie’s message and Mavis never responded, Chrissie can’t claim that her offer was accepted.
Conclusion
There is no valid Contract between Chrissie and Mavis
So there is no claim against Mavis under the law of contract

7. Whitegoods v Mavis Issues Rules (the Law)
Is there an breach of contract between Whitegoods World and Mavis?
Was the time of delivery date a Condition of the contact?
Rules (the Law)
Term or Mere Representation
A statement will be in term of a contract if it was reasonably intended by the parties - Hospital Products Ltd v United States Surgical Corp
Factors that would indicate a statement be a term of a contract would include the importance of the statement or any special knowledge of one party to the statement - Ellul & Ellul v Oakes

8. Whitegoods v Mavis Rules (the Law) Application (Law to the Facts)
Condition or Warranty
Whether a term in a contract is a condition or a warranty will depend on whether the promisee would not have entered into the contract unless he had been assured of a strict, or a substantial, performance of the promise, and that this ought to have been apparent to the promisor Tramways Advertising v Luna Park
Application (Law to the Facts)
Mavis made it absolutely clear to the shop attendant at the time of purchase that she needed the fridge delivered on the agreed day. In those circumstances, the delivery date became sufficiently important to make it at least a term of the contact.

9. Whitegoods v Mavis Application (Law to the Facts) Conclusion
And, based on what Mavis has said, it ought to have been apparent to the shop attendant that Mavis would not have entered into the contract if the fridge couldn’t be delivered on that day – making the delivery date an essential term or a Condition of the contract.
Conclusion
Given the delivery date was both a term and a condition of the contract and that term was not satisfied by Whitegoods, Mavis was entitled to terminate the contract she had with Whitegoods and not accept the fridge when it turned up 1 month later
If Whitegoods sued for $5,500 they would not succeed as they were in breach of the contract – not Mavis.

10. Discount Lino v Mavis Issue Rules (the Law)
Can Mavis rely on one of the consumer guarantees under the ACL?
Rules (the Law)
Section 54 – Acceptable Quality
Section 55 – Fitness for any Disclosed Purpose
Section 56 – Supply of Goods by Description

11. Elements of Section 54(1) ACL
Person – s2C Acts Interpretation Act – person includes a corporation
Supply – s2 Australian Consumer Law – supply in relation to goods means supply by way of sale, exchange, lease, hire or hire-purchase
Trade or Commerce – s2 Australian Consumer Law – means trade or commerce within Australia and includes any business.
Goods – s2 Australian Consumer Law – is an inclusive definition that would include a fridge, oven, flooring
Consumer – s3(1) Australian Consumer Law – a person is taken to have acquired goods as a consumer if the amount does not exceed $40,000 or the goods were of a kind ordinarily acquired for personal, domestic or household use.

12. Discount Lino v Mavis Application Person – Discount Lino  Supply - 
Trade and Commerce - 
Goods - 
Consumer – Was Mavis a consumer in this transaction ?
Transaction was greater than $40,000 
Good of a kind ordinarily acquired for domestic, personal or household use 
Carpet Call v Chan

13. Elements of Section 54(2) ACL
Rule – s54(2) Australian Consumer Law – Acceptable quality means
Fit for the purposes for which goods of that kind are commonly supplied ….
Rassell v Garden City Vinyl and Carpet Centre Pty Ltd
Carpet Call v Chan
Acceptable in appearance and finish
Free from Defects
Safe
Durable
As a reasonable consumer fully acquainted with the state and condition of the goods .. would regard as acceptable – having regard to –
s54(3) …. the nature of the goods, the price, statements made about the goods on any packaging or label on the goods … etc

14. Discount Lino v Mavis Application Conclusion
Was the lino fit for the purposes for which goods of that kind are commonly supplied - No – wear marks and looks ‘like a race track’ 
Rassell v Garden City Vinyl and Carpet Centre Pty Ltd
Carpet Call v Chan
Was the lino durable – No 
Given the nature of the goods, the price, statements made about the goods on any packaging or label on the goods – 
It was expensive; and
it was supposed to be a heavy grade domestic quality vinyl
Conclusion
Guarantee of Acceptable Quality in s54 of the ACL does apply
Refund or Replace or Repair – s261 of the ACL

15. Cake Cookers v Mavis Issue Rules (the Law)
Can Mavis rely on one of the consumer guarantees under the ACL?
Rules (the Law)
Section 54 – Acceptable Quality
Section 55 – Fitness for any Disclosed Purpose
Section 56 – Supply of Goods by Description

16. Elements of Section 55(1) ACL
Person – s2C Acts Interpretation Act – person includes a corporation
Supply – s2 Australian Consumer Law – supply in relation to goods means supply by way of sale, exchange, lease, hire or hire-purchase
Trade or Commerce – s2 Australian Consumer Law – means trade or commerce within Australia and includes any business.
Goods – s2 Australian Consumer Law – is an inclusive definition that would include a fridge, oven, flooring
Consumer – s3(1) Australian Consumer Law – a person is taken to have acquired goods as a consumer if the amount does not exceed $40,000 or the goods were of a kind ordinarily acquired for personal, domestic or household use.

17. Cake Cookers v Mavis Application Person – Cake Cookers Supply - 
Trade and Commerce - 
Goods - 
Consumer – Was Mavis a consumer in this transaction ?
Transaction was less than $40,000 

18. Elements of Section 55(2) ACL
Rule – s55(2) Australian Consumer Law – Disclosed Purposes means a particular purpose (whether or not that purpose is a purpose for which the goods are commonly supplied) for which the goods are being acquired by the consumer and that:
(a)  the consumer makes known, expressly or by implication, to:
(i)  the supplier; or
(ii)  a person by whom any prior negotiations or arrangements in relation to the acquisition of the goods were conducted or made; or
(b)  the consumer makes known to the manufacturer of the goods either directly or through the supplier or the person referred to in paragraph (a)(ii).

19. Elements of Section 55(3) ACL
(3)  This section does not apply if the circumstances show that
the consumer did not rely on, or that it was unreasonable for the consumer to rely on,
the skill or judgment of the supplier, the person referred to in subsection (2)(a)(ii) or the manufacturer, as the case may be.

20. Cake Cookers v Mavis Application Conclusion
Did Mavis specifically disclose the purpose for which she was buying the oven and patty pan holders ? Yes 
Grant v Australian Knitting Mills
Did Mavis rely on the skill and judgement of Cathy at Cake Cookers – Yes
Ashington Piggeries v Christopher Hill
Was it unreasonable for Mavis to rely upon Cath’s skill and judgement? – No 
Conclusion
Guarantee of Disclosed Purpose in s55 of the ACL does apply
Refund or Replace or Repair – s261 of the ACL

21. The End