Assessment- Case Studies Contract Law and the Australian Consumer Law)

Learning Outcome

Unit Learning Outcome (ULO)

LO 1: Apply key principles of law for commerce to recognise and evaluate legal issues.
1: Discipline-specific knowledge and capabilities
2: Critical Thinking

LO 2: Analyse and interpret legal issues in domestic and international contexts.
1: Discipline-specific knowledge and capabilities
2: Global citizenship

LO 3: Use appropriate digital technologies to search, retrieve and apply relevant information to law for commerce.
1: Digital literacy

Description / Requirements

Please answer BOTH questions

Question 1.

‘Quad-bikes 4eva' (QB4) is a new outdoor recreational facility near Hepburn Regional Park that allows fun-seekers a novel way to see some of the Victorian countryside. Riviera decides to take her children and family friends for an afternoon of fun and action at QB4. She books and pays for an afternoon quad-biking trail ride for a group of 12 online with QB4 on their website. One of the terms and conditions of the contract provides:

‘Quad-bikes 4eva will not be liable for any injury, loss, damage, death, economic loss whatsoever suffered by you; and consumer guarantees do not apply to this contract of service'.

Riviera writes in the ‘comments' section of her booking that she has young children coming along so please be sure that the vehicles are suitable for them. Two weeks later Riviera and the group make their way to QB4 as planned. Prior to heading off for the quad biking session, the chief instructor and guide (Jones) at the facility instructs everyone on the safety rules and provides each member of the group a helmet and some gloves. He also points to signs at the entrance of the facility that warn of the ‘dangers' of biking in natural terrain. After an afternoon of wildlife watching and nature sightseeing the group of 12 bikers decide to head back to headquarters before the sun is done for the day. On the way back the group splits into two sections, the front group comprising mostly of the older teenage boys (who enjoy riding the bikes at a higher speed) and the rear group comprising the parents and some of the younger children. Kang, Riviera's youngest son is 10 years old. This is his first time to go quad- biking and he is in this rear group. As the two groups become further split by the eagerness of the teenage boys, Jones, who is at the front of the second group, decides to lift the pace and speeds up. Kang, who does not want to be left behind follows suit but in doing so loses control of the vehicle and crashes into a tree, suffering severe injury. Upon inspection of the quad-bike given to Kang, Riviera discovers that the age suitability for the vehicle was 12-15 years old and that the brakes were faulty due to a design problem from the manufacturer (Tetrabikes), who had sold the bikes directly to QB4.

Advise Riviera (on behalf of Kang) whether they have any claims against ‘QB4' and/or ‘Tetrabikes' under the ‘consumer guarantees' of the Australian Consumer Law. (600 words)

Please use case law and statutory provisions to support your answer.

Question 2.

Nicky is the owner and manager of a retail toy store (Toys'n'Stuff Ltd) and an avid sailor and member of the Port Melbourne Sailor's Club (PMSC). To celebrate her company's 10th year anniversary and show the company's commitment to the community she decides to hire a special vessel (the Mistress - which has large viewing decks safe for up to 30 children and on board activities and facilities specially designed for kids - the only one of its kind in all of Victoria) from the club for a series of day trips (total of 8 trips over 2 months) for disadvantaged children to Phillip Island to see the penguins. Nicky had organized and pre- booked special tours on Phillip Island with tour operators for each of the trips. The boat hire and tours would be fully paid by Toys'n'Stuff Ltd and provide an opportunity for Nicky and her staff to work closely with children's charities and community groups in East Melbourne. PMSC tells Nicky that the total contract price is $4800 ($600 per trip) and to pay $2000 up front and the remaining $2800 on a trip-by-trip basis ($350 per trip). Nicky agrees and signs the charter- hire contract with PMSC and pays the $2000 up front. After two successful trips Nicky receives a call from PMSC informing her that the Mistress has to undergo emergency safety alterations due to new government regulations. These new regulations only just came into effect after emergency legislation was introduced by the Maritime Safety Authority and passed in the Victorian Parliament. PMSC tell Nicky that the boat will not be able to sail for at least three months. Nicky knows that there is no other vessel for hire in Victoria capable of adequately providing for her specially designed children's tours, especially at such short notice. She decides to rent three smaller vessels from a hire company which turns out to be much more expensive, and completely inadequate for her planned outings. She is furious at the club for not foreseeing this problem (the change of law). PMSC are willing to refund Nicky for the remaining 6 trips ($2100) but Nicky tells PMSC it is their fault she had to spend so much more money and they should have to pay for the loss she suffered due to their breach of contract.

(a) Advise PMSC whether they can claim that the contract was terminated/discharged other than by breach. (450 words)

(b) Advise Nicky whether she can claim back the money she paid to PMSC in the event that the contract is held to be discharged by frustration. (150 words)

Please use case law and statutory provisions to support your answer.

Word Count: 1200 words including in-text citations and quotations. It does not include the reference list. (10% leeway).