Sample/practice exam 2018, questions PDF

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Past exam questions compiled in 2018...

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LAWS1015 LAWS5002 EXTRA CONTRACT LAW QUESTIONS TO PRACTICE ON

These questions are taken from a selection of past papers. I’ve amended some of the facts of the problems to reflect the different course content (earlier contracts courses also included a discussion of damages)

QUESTION 1 (30 MARKS) Andrew is an Alpaca breeder and contracts to purchase an automated animal feeding machine from Georgia, a manufacturer of farm equipment. The contract price was $10,000 and included installation of the machine. The written order form signed by Andrew and Georgia on 1 May 2017, includes the following terms

1. Georgia agrees to exercise reasonable care in installing the system. 2. Georgia accepts no liability for any loss or damage, howsoever caused.

The machine is sent by Georgia to Andrew by train. To stop it rattling and being damaged while in transit, the machine's ventilator is taped shut. When Georgia arrives to install the machine at Andrew’s farm she fails to remove the tape.

Andrew loads the machine with an alpaca food mix called 'Happy Alpacas'. After a few days, Andrew notices that the alpacas are sickly and that the food being distributed by the machine is mouldy. Within a week all of Andrew’s alpacas are dead. An investigation is launched and it is revealed:

(a)

that the alpacas died from a bacterial infection which was found in the mouldy feed,

(b)

that the mould would not have occurred if the ventilator had been open;

(c)

that Happy Alpacas food mix has very strict production quality control and food mix from the same batch as that supplied to Andrew did not contain any mould.

Advise Andrew.

(I’ve modified this from the original question which also includes aspects of damages and causation, not relevant for LAWS 1015/LAWS5002 but relevant to Torts and Contracts 2).

QUESTION 2 (30 MARKS) Anne agrees to construct, supply and instal an air conditioning system in Ben's home. Ben agrees to pay $10,000 one month after installation. So far as relevant the contract, which is dated December 1, also provides: 1.

Anne agrees to use new materials in constructing the system.

2.

Anne agrees to exercise reasonable care in installing the system.

3.

Anne undertakes that the system will be installed ready for testing on March 1.

4.

Anne guarantees that the system will cost no more than $10 per hour to run at full capacity.

Advise Ben of his rights in EACH of the following ALTERNATIVE situations. a) On February 1 Anne advises Ben that the system cannot be installed before April 1. b) The system is constructed using 90 per cent new materials and 10 per cent used materials, saving Anne $200. There is no evidence that the used materials are in any way defective or that they will impair the running of the system or reduce its effective life. c) When installed the system will cost $15 per hour to run at full capacity. Electricity costs rose by 20 per cent between December 1 and March 1. d) On March 1 installation is not complete and it will take a further 7 days to instal the system.

QUESTION 3 (20 MARKS – IE THIS CAN BE ANSWERED IN AROUND 40 MINUTES) Peter is a farmer who specialises in buying young pigs and either rearing them for market or training them for film and television. Anna is a pig breeder. They sign a written contract for Anna to sell piglets to Peter over a two-year period, at the rate of 100 every month for an agreed price per delivery. The contract stipulates: 'It is a condition of this contract that each instalment of 100 piglets is delivered by Anna to Peter's farm not later than the first Thursday of each calendar month.' The first instalment is delivered punctually, but in the second month no pigs arrive until the Sunday, three days late. Peter, for personal reasons never does business on a Sunday and refuses to accept delivery. He telephones Anna to say that he will accept no further instalments, adding: 'So far as I'm concerned, “not later than” Thursday does not mean Sunday.' Anna protests that this is no reason to break off the whole contract, and immediately instructs her solicitor to issue legal proceedings claiming damages for wrongful repudiation of the contract. A week later, Peter learns that one of the second batch of piglets has died from a highly infectious disease which would have been averted in Anna had followed standard inoculation procedures. The contract says nothing about disease or inoculation.

Advise Peter

QUESTION 4 (30 MARKS) Rupert is a famous designer and maker of clothes and accessories. Discuss the contractual rights of Rupert and his customers in each of the following circumstances: (a)

Kramer, who has come into possession of a rare diamond, contracts with Rupert to design and make an engagement ring for Kramer's girlfriend Elaine for an agreed price of $3000, with Kramer dropping off the diamond to Rupert’s studio for this purpose and paying $300 as a deposit. When Elaine breaks off their relationship, Kramer tells Rupert to stop work. Rupert disregards Kramer's instructions and finishes the ring.

(b)

Rupert has found some rare 1950s vinyl which is just large enough to make into two handbags of a particular design. In separate transactions, he contracts first with Gemma and then with Vera to make and sell a handbag from the vinyl to each of them. The handbags cost $2,000 each and both Gemma and Vera have paid $200 as a deposit. He has finished one handbag and has begun work on the second, when his premises are burgled and the one completed handbag is stolen.

(c)

Jennifer, a long time customer of Rupert, calls him up and asks him to make a dress for a cocktail function she will be attending. She asks him to err on the conservative side. She lets Rupert know that she is looking forward to the function as she has not had a break for months and it should be fun. She also tells him some people who are very important to her future career will be there and that she had been trying to find a way to meet them for a long time. The dress is delivered to Jennifer's office just before the function is to begin. Jennifer is shocked to find it is much shorter in length than she would usually wear, and while she can fit into it, Jennifer believes she could not possibly wear it to the function. She has no time to buy another dress, and is in any case too distressed to try. She is very upset and wants to know if she has an action against Rupert for breach of contract.

QUESTION 5 (30 MARKS) The Lungfish are a popular American band who are planning a tour of New South Wales. They transact all their business through a company called On Land or Sea Pty Ltd (OLS). OLS enter into a contract with Mosh Pit Promotions a New South Wales based promotions partnership. It is the obligation of Mosh Pit to find a suitable venue, obtain relevant permits and take care of all ticketing, including sales to the public. The contract is governed by the law of New South Wales. Mosh Pit investigate a number of venues and to help them in this they enter into a separate contract with a surveyor whose job is to make sure that any possible open air venue is not affected by aircraft noise. Mosh Pit, after receiving a favourable report from the surveyor, finally decide on an open air stadium in Bondi and enter into a contract with the owner of the venue to hire it for the concerts. Mosh Pit then advertise the concert and it is sold out. All the tickets have a clause which states:

'The holder only has a right to a refund if the concert is cancelled. Mosh Pit Promotions Pty Ltd is not liable to the holder for any loss or damage (personal or otherwise) howsoever caused.' The day before the concert, the local council revoked its permit to use the stadium as it had found out that the stadium was constructed using a type of cement that deteriorates with age. There is a real danger that the venue could collapse under the weight of screaming, dancing teenagers. The concert is cancelled at the last moment. Mosh Pit have to engage extra staff to return money to all ticket purchasers.

OLS now wish to sue Mosh Pit for breach of contract. How would they go about proving such a claim and what defences might Mosh Pit raise?

Assume instead that the stadium is safe and that the Council did not revoke the permit and that the concert went ahead. The venue was in fact right in line with a flight path and that during the concert the band's sound is constantly drowned out by aircraft noise. (1) Is the surveyor liable to Mosh Pit Promotions for breach of contract? (2) What rights do ticket holders have against Mosh Pit Promotions? (3) Are the ticket holders entitled to bring an action for breach of contract against OLS?...