Team 32-Assessment 2-Team Paper-1 PDF

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LAW 2447 – COMMERCIAL LAWAssessment Task 2 – Team PaperRmit University VietnamHanoi CampusCourse’s code and name: LAW 2447 – Commercial Law Class group: Thursday morning Lecturer’s name: Do Thi Huong Nhu Team number : 32 Team members: Do Khanh Huyen – s Pham Thuy Nga – s3697 073 Le Hoang Phong – s37...

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LAW 2447 – COMMERCIAL LAW Assessment Task 2 – Team Paper

Course’s code and name: LAW 2447 – Commercial Law Class group: Thursday morning Lecturer’s name: Do Thi Huong Nhu Team number: 32 Team members: Do Khanh Huyen – s3694634 Pham Thuy Nga – s3697073 Le Hoang Phong – s3741312

Rmit University Vietnam Hanoi Campus

Table of Contents Scenario 1:...................................................................................................................................................1 1.1 Peter v Evan:......................................................................................................................................1 1.2 Peter v Reid:......................................................................................................................................3 Scenario 2....................................................................................................................................................5 2.1 Tom v BlackRock Café........................................................................................................................5 2.2 Tom v James......................................................................................................................................6 Scenario 4:...................................................................................................................................................7 4.1 Trevan v Isaac....................................................................................................................................7 4.2 Trevan v Olivia:................................................................................................................................10 Scenario 3.................................................................................................................................................. 11 3.1 Loan v Trinh.....................................................................................................................................11 3.2 Loan v Huy.......................................................................................................................................12 3.3 Loan v Nha Trang Jump Society......................................................................................................13 3.4 Huy v Hospital.................................................................................................................................14

Scenario 1: 1.1 Peter v Evan: Legal Issues: The first issue is whether Peter, the plaintiff, can successfully sue Evan, the defendant, for committing a tort of negligence when Peter, who was sitting in the passenger’s seat of a vehicle, suffered a neck injury because such vehicle skidding into the traffic light was driven by Evan, who was driving in the state of being intoxicated by a large consumption of alcohol. The second issue is whether Evan can claim a contributory negligence against Peter to lower his liability when Peter allowed himself to be driven by a drunk driver and failed to wear a seatbelt at the time of the accident. Legal Rules: First, it must be proven that the defendant owes the plaintiff a duty of care (DOC). In most scenarios, it is comparatively effortless to demonstrate the existence of a DOC given that the relationship between the defendant and the plaintiff is listed among the established categories of DOC. If the established categories are not satisfied, in order to justify the 1

existence of DOC, the ‘Neighbor test’1 will be utilized to prove that the defendant’s conduct could potentially cause harm to others and the plaintiff is closely and directly affected by the defendant’s act. Next, it must be determined whether the defendant breached the DOC if he or she failed to meet the required standard of care (SOC), which refers to what a reasonable person would have done in the same position2. To ascertain the required SOC and whether the defendant violated the DOC, the court will profoundly consider four elements: the probability of harm 3, the likely seriousness of harm4, the cost of taking precautions5, and the social usefulness6. Lastly, legal obligation can be divided between the two parties as the defendant can use a ‘contributory negligence’7 as a defence by providing evidence that the plaintiff was partially negligent and thus contributed to their own injuries. Application: Duty of Care It is apparent that the relationship between Evan and Peter, the driver and passenger of the vehicle, falls within the established category of DOC – motorists and road users. Therefore, there existed a DOC owed to Peter by Evan. Breach of DOC Alcohol can influence people’s judgement, reduce concentration, decrease coordination and vision, thus, those who drive motor vehicles while being impaired by alcohol are incapable to meet the required SOC to drive within the speed limit, cautiously observe the traffic, cooperate with other road users and comply with traffic law. This will produce a high probability to severe accidents. Therefore, the probability of harm in this case is high. The likely seriousness of harm is also high as motor vehicles accidents often lead to catastrophic consequences, including fatal injuries. Other road users, most likely motorcyclists or pedestrians, could have been killed if they were close to the traffic light at the time of the accident. Regarding the burden of taking precautions, Evan could have prevented the accident to occur by sitting in the passenger seat and letting Reid, who was sober, drive the vehicle. Thus, the cost of taking precautions in this scenario is low. 1 Donoghue v Stevenson [1932] AC 562 2 Civil Law (Wrongs) Act 2002 (ACT) s 43(1); Civil Liability Act 2002 (NSW) s 5B(1); Civil Liability Act 2003 (Qld) s 9(1); Civil Liability Act 1936 (SA) s 32(1); Civil Liability Act 2002 (Tas) s 11(1); Wrongs Act 1958 (Vic) s 48(1); Civil Liability Act 2002 (WA) s 5B(1). 3 Bolton v Stone [1951] AC 850 4 Paris v Stepney Borough Council [1951] AC 367 5 Latimer v AEC Ltd [1953] A 643 6 Watt v Hertfordshire County Council [1954] 1 WLR 835 7 Ingram v Britten [1994] Aust Torts Reports 81-291

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There is no relevant social utility involved in this context because the defendant’s conduct brought no advantage to the society. Based on the examination of the four factors above, Evan has breached the DOC owed to Peter. Defence Evan can make a contributory negligent defence to argue that Peter contributed to his own injury by negligently accepting to be driven by a drunk driver and unbuckling his seat belt at the time of accident. Peter continued to stay in the car driven by Evan despite being aware that Evan was drunk and under fine suspension. In the interests of his own safety, Peter could have exited the car, but he was considerably drunk due to large consumption of alcohol and unable to make a reliable assessment before accepting a ride home from the defendant. As Peter was intoxicated at the time the accident took place and was counting on the care and skill of a person knew to be intoxicated, contributory negligence on the part of Peter will be presumed, following the Civil Liability legislation.8 Moreover, at the time of the accident, Peter failed to keep his seat belt fastened. A presumption of contributory negligence on the part of Peter will be established, following the Road Traffic Act9. Conclusion: To summarise, Evan owed and breached a DOC to Peter, caused Peter to suffer a neck injury. Nevertheless, the judge can apportion the liability between Peter and Evan as Peter can be held liable for contributory negligence.

1.2 Peter v Reid: Legal Issues: The legal issue is whether Reid, the defendant, committed a tort of negligence to Peter, the plaintiff when Reid was warned by Peter of Evan’s state of being drunk and under suspension, however, ignored this caution, and despite being the only sober person on the vehicle, Reid did not insist on driving and quickly allowed Evan to drive, causing an accident to happen and left Peter with the neck injury. Legal Rules:

8 Civil Law (Wrongs) Act 2002 (ACT) ss 96-96; Civil Liability Act 2002 (NSW) s 50; Personal Injuries (Liabilities and Damages) Act 2003 (NT) ss 14-15; Civil Liability Act 2003 (Qld) ss 47-49; Civil Liability Act 1936 (SA) s 46-50; Civil Liability Act 2002 (Tas) s 5; Wrongs Act 1958 (Vic) s 14G: Civil Liability Act 2002 (WA) s 5L. 9 Civil Liability Act 1936 (SA) ss 49; Road Traffic Act 1961 (SA).

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First, the existence of a DOC must be proven. If the relationship between two parties does not lie within the established categories, the ‘Neighbor test’10 will be implemented (as cited above in the case between Peter v Evan). Second, to determine whether the defendant has breached the DOC owed to the plaintiff, the ‘Reasonable person test’ and four key elements of SOC will be discussed (as cited above in the case between Peter v Evan). Application: Duty of Care As the relationship between Reid and Peter is not recognized among the established categories of DOC, the ‘Neighbor test’ is executed. First, the act of ignoring Peter’s warning and letting a drunk person drive was potentially harmful to others. Second, as they were riding in the same vehicle, Peter was closely and directly influenced by Reid’s behaviour. Therefore, the ‘Neighbor test’ is satisfied and Reid owed Peter a DOC. Breach of DOC Reid failed to meet the required SOC as Reid’s behavior cannot be seen as what a reasonable person would have done in the same situation. A sober person, with regards to his own safety, would have insisted on driving instead of allowing a drunk man steer the wheel. A reasonable person under the same circumstances as Reid would have taken precautions agaisnt the risk of harm11. To justify this statement, four major factors will be considered. The probability and the likely seriousness of harm is high since letting a drunk person drive clearly not only can cause harm to the passengers but also other road users if an accident occurred. The highest level of seriousness of harm could have been death if other road users were involved and killed in the crash. The cost of taking precautions in this case is low. Reid could have refused to let Evan in the car unless he sat in the passenger seat. Moreover, Reid could have ignored Evan’s demand and drove off to avoid any risk of harm. There is no social usefulness involved in this case. Based on the above analysis, Reid breached his owed DOC to Peter. Conclusion: Although it was not Reid’s fault that directly caused the accident, Reid’s conduct of negligence should be held responsible for Peter’s injury, thus, Peter can successfully sue Reid. 10 Donoghue v Stevenson [1932] AC 562 11 Civil Law (Wrongs) Act 2002 (ACT) s 43(1); Civil Liability Act 2002 (NSW) s 5B(1); Civil Liability Act 2003 (Qld) s 9(1); Civil Liability Act 1936 (SA) s 32(1); Civil Liability Act 2002 (Tas) s 11(1); Wrongs Act 1958 (Vic) s 48(1); Civil Liability Act 2002 (WA) s 5B(1).

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Scenario 2 2.1 Tom v BlackRock Café Legal Issue The legal issue in this case is whether Tom, the plaintiff can successfully sue Blackrock Cafe, the defendant for committing a tort of negligence when Tom got hit by the Cafe’s lighting grid which had crashed down on Tom and resulted in significant injuries to his neck and spine. Legal Rules First, it must be verified whether the defendant owes the plaintiff a DOC. If the established categories does not cover the relationship of two parties, to prove the presence of DOC, the ‘Neighbor test’12 will be brought in. Next, to demonstrate the required SOC, the relevant legal rules of The Council of the Shire of Wyong v Shirt will be implemented in this scenario13. Breach of DOC is proven by taking into account four key components (as cited above in the case of Peter v Evan). Moreover, the defendant can utilize a ‘contributory negligence’14 as defense by giving proof that the plaintiff was partially negligent and hence contributed to his own injuries. Application: Duty of Care The relationship between Tom and Blackrock Café fits one of the established category of DOC which is Occupier and Guest. Hence, Blackrock Café is proved to owe a DOC to Tom. Breach of DOC Blackrock Café did not meet the desired SOC because the act of not keeping the lighting grid secured to the ceiling can potentially make it become loose and cause serious injuries to anyone in the plaintiff’s position. Applying four elements of SOC, it can be seen that the probability of harm is high because considering the circumstances of the Café when the live music is meant to encourage people to be excited and jump along, the lighting grid can easily fall down and hurt people. The likely seriousness of harm is also high as the lightning grid is 4.5 to 5 meters big and if it falls, it will cause severe damage to people who stand below. The plaintiff could have been unconscious if the grid hit directly to his head. The cost of taking precaution is not expensive because Blackrock Café later hired a builder to settle the lighting framework to the ceiling to avoid any unfortunate possibilities. This means that the burden of taking precaution is low 12 Donoghue v Stevenson [1932] AC 562 13 The Council of the Shire of Wyong v Shirt per Mason J [1980] 146 CLR 40 14 Ingram v Britten [1994] Aust Torts Reports 81-291

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and the Café should have done this long before to prevent accidents. The social utility is not applicable in this case. Defence Tom is not held liable for any contributory negligence because at the time of the accident, he was standing still and having a conversation with Ben. Conclusion Based on the above analysis, Tom can successfully sue Blackrock Cafe for having a tortious liability.

2.2 Tom v James Legal Issue The legal issue is whether James, the defendant, committed a tort of negligence to Tom, the plaintiff, when James leapt onto the bar table, waved his hands around and then leapt out at the lighting grid making the grid become loose and fall down on Tom, which left Tom a damage to his neck and spine. Legal Rules First, the existence of a DOC must be proven. If the relationship between two parties is not established among the categories, the ‘Neighbor test’15 will be implented. Second, to verify the breach of DOC, four factors of SOC will be analysed (as cited above in the case of Peter v Evan). Application Duty of Care The relationship between Tom and James is not under any established category of DOC as they are both guests of Blackrock Cafe. A “Neighbor test” will be applied. Tom and James are neighbors in law because they were in the same bar, thus, James’s action potentially caused harm to Tom closely and directly. Consequently, James owed Tom a DOC. Breach of DOC The probability of the harm in James’s conduct is high as his leaping onto the bar table and out like Tarzan at the lighting grid would potentially cause it to become loose, slip out of the ceiling hook and fall on those who are standing under the grid, leading to serious injuries. and The likely seriousness of risk is high as his conduct could not only result in the loss of balance of those standing underneath but also make them pass out. Cost of precautions is 15 Donoghue v Stevenson [1932] AC 562

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apparently low as he could have simply controlled himself and not jumped on the table to avoid any accident. Lastly, the social utility is not relevant in this case. After all, James breached his DOC owed to Tom. Conclusion In conclusion, James committed a tort of negligence toward Tom and can be sued by Tom as a consequence.

Scenario 4: 4.1 Trevan v Isaac Legal Issues: The first issue is whether there existed a legally enforceable contract between Isaac, the seller and Trevan, the buyer of the shorts. The second issue is whether Trevan, the buyer, can sue Isaac, the seller, for breaching the contract when he refused to sell the shorts to Trevan after Trevan had already informed Isaac of his acceptance to purchase the shorts. Legal Rules: 

Rules of forming a contract:

To prove the existence of a contract between the two parties, three elements must be satisfied: Agreement, Consideration and Intention to create legal relations. First, a contractual agreement will be effective under these requirements: the offeror has created an offer, the offeree has accepted the offer and the offeree has communicated their acceptance to the offeror16. The offeror’s offer must be clear and complete 17. Moreover, the offer must be communicated, otherwise, it is not considered legally valid 18. Offerors are entitled to revoke their offers anytime prior to acceptance19.

16 Smith v Hughes [1871] LR 6 QB 597 17 Mildura Office Equipment & Supplies Pty Ltd v Canon Finance Australia Ltd - [2006] VSC 42

18 R v Clarke [1927] 40 CLR 227 19 Dickinson v Dodds (1876) 2 Ch D 463

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The offeree’s acceptance must be clear and complete 20. The acceptance must be effectively communicated between two parties, otherwise, the agreement is not completed21. The only exception relevant to this case is the postal rule. The postal rule stated that the acceptance is effective and validates the contract as soon as the letter of acceptance is sent, not when it is received22. The postal rule is only applicable to postal communications and has no relevance to instantaneous forms of communication, namely telephone calls or faxes23. Second, consideration is the contribution of each party and the agreement is not enforceable without consideration24. Past consideration is invalid25 and consideration must be sufficient for the contract to be effective26. Lastly, intention to generate legal relations is crucial to legally enforce a contract. When the agreement is established within a business context, each party will be presumed to be intended to be bound27. The presumption will be refuted if the parties involved apparently did not intend their agreement to be enforceable legally28. 

Rules of negating a contract:

A formed contract can still be unenforceable if there exists a lack of formality. A legislation that demands certain contracts to be in writing and signed to be operative and enforceable. Regarding contracts for the sales of goods worth more than $20, they must be evidenced in writing and signed to be legally enforceable. However, this rule only applies in Western Australia and Tasmania29. Application: Agreement: The existence of an agreement between Isaac and Trevan is justified as it met all 3 requirements. Isaac has created the offer to sell the shorts by writing a letter to Trevan and Trevan has accepted this offer by writing back to Isaac a letter to purchase the shorts. The acceptance of Trevan is communicated to Isaac. 20 Scammell and Nephew Ltd v Ouston [1941] 1 AC 251 21 Felthouse v Bindley [1862] 142 ER 107 22 Adams v Lindsell 106 ER 250 23 Brinkibon Ltd v Stahag Stahl Und Stahlwarenhandelsgesellschaft mbH [1983] 2 AC 34 24 Chappell & Co Ltd v Nestle Co Ltd [1960] AC 87 25 Roscorla v Thomas [1842] 3 QB 234

26 Biotechnology Australia Pty Ltd v Pace [1988] 15 NSWLR 130 27 Edwards v Skyways Ltd [1964] 1 WLR 349 28 Rose& Frank Co v. JR Crompton & Brothers Ltd [1925] AC 445 29 Sales of Goods Act 1896 (Tas) s 9; Sales of Goods Act 1895 (WA) s 4

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The enforceability of the contract was unaffected by Isaac’s revoking the offer because the revocation was invalid. Offerors are allowed to revoke their offers anytime before acceptance, however, Isaac phoned Trevan to withdraw the offer after the acceptance was effective and the contract was legally formed. Eventhough Isaac received the acceptance letter on November 17th, applying the postal rule, the acceptance already became effective by the time it was sent on November 13th. Despite Trevan calling Isaac on November 14 th to revoke the offer and called Isaac again to accept the offer on the same day, this was sent by instantaneous communication, thus, it was not in effect until it is actually received by Isaac. Considerations: The considerations of this contract are the pair of shorts worn by player Robinho when he pl...