Question:
Kate and Gino are cousins. A few years ago Kate completed her Master of Professional Accounting degree at Southern Cross University. Since then she has worked as an accountant in an accountant's office. Recently she was admitted to a professional accounting body. She decided that she would establish her own business specialising in internal control systems. In establishing the business she was assisted by Gino who gave her valuable advice in regard to various computer programmes. He also gave her the names of some people who were familiar with that type of business and also introduced her to business people who could be potential clients.
Kate's business prospered. She decided that in view of her success she would buy a very special expensive foreign car as an indicator of that success. She bought the car and in appreciation of the help given to her by Gino she said to him: ‘I want to give you my old car as a gift for all the help you gave me in getting started in business.' Gino replied: ‘Thank you, that's great. I am in some financial difficulty at present and getting your car will be of enormous financial benefit to me'.
Kate then said: ‘In that case I would not mind if you sold my old car. You could then use the cash to help get you over your financial problem. The car is worth about $20,000.'
Gino decided to sell the car in order to get the cash. With the help of Kate he drafted an advertisement for publication in a daily newspaper that read:
Holden X22 car for sale $20,000. Excellent condition. Write, phone or, email. The first person to contact me will get the car.
There followed Gino's name, address, phone number and email address. The advertisement was published in the daily newspaper on May 1 last.
On that day Marcel posted a letter to Gino saying: ‘I am interested in buying your car. Is it an automatic or manual?' Gino did not reply to him.
On May 2 Lin posted a letter to Gino: ‘I agree to buy your car for your price of $20,000. When can I pick it up?' Gino did not reply to her.
On May 3 Singo phoned Gino and said that he agreed to buy the car for the advertised price. Because of the bad phone connection Patrick was unsure of Dennis' reply.
Also on May 3 Hang sent an email: ‘I really want your car. I enclose a cheque for $2000 as a deposit on the full price of $20,000.' Gino read the email but did not reply to her.
However, early on May 2 Kate said to Gino ‘I am very sorry but I have decided to keep my Holden car as I think I will need a second car for use in the business. I am very sorry for any trouble I may have caused you.'
Assume the letters were received by Gino two days after being posted.
You are required to:
Advise each of the above parties in relation to any legal rights or obligations they may have based on the above circumstances.
In giving your advice:
a. refer to and rely on the relevant legal principles; and
b. discuss briefly the relevant case law.