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    Business Law Assignment Australia

    Business Law Assignment Australia

    Business Law Assignment Australia


    1a - The territory of England and Wales contains four sources of law and they are- the common law, the law developed and affected by the legislation, the European law and the European convention on Human Rights (Ceil, 2018). These four sources can be understood in the following manner-

    Common law:-

    The basis of common law lies in the centuries of traditions and common practices that the people of the region have been following. These common practices and traditions along with the jurisprudence developed with the help of various judgments based on the decision of the courts with respect to common practices and traditions is what is common law (Fletcher, 2016). Common law does not exist in books or in any codified form, it has been derived from practice, culture and tradition.

    Common law-


    The best suitable synonym of this word is statutory regulation. Legislation is the process where laws are made, debated and then codified by the people who are competent and able to do it. Laws are drafted by an authority and enacted by the same to regulate the area with respect to which the legislation has been framed.


    European Law:-

    England and Wales is a substantial part of Europe as it is one of the focal points of history, culture and commerce across the Europe. European law is based on mutually accepted treaties between member states, conventions, charters, peace treaties, treaties of the United Nations, etc (Conant et al., 2018).

    The European Convention on Human Rights:-

    This is a source of law that is based on the postulates of the convention on human rights which was formulated with the objective of protecting the human rights of the people who are the citizens of those countries who form the part of the European Union. As a member of the European Council the convention by default becomes law.

    The European Convention on Human Rights

    1b - Private law is the branch of law that governs the issues that concern the private matters of the aggrieved party such as breach of contract, trespass, disputed with respect to custody of children, etc. Public law on the other hand is the law that governs the issues that affect the general public or society at large (Himsworth, 2019). The areas of law covered in the private law are- contract law, the family law, property law, etc. the areas of law covered in the public law are- municipal laws, administrative law, citizenship law, constitutional law, criminal law, etc. One interesting part about the two branches is that in the public law the state is a party to the dispute as well as the judge of the dispute, whereas in the private law state is usually only the adjudicator of the dispute between the two parties. Private law governs the principles of relationship of people with other individuals and entities whereas the Public law governs the principles of relations of an individual with the government (Chan, 2016). The best way to understand the differences between the private law and the public law is by understanding the nature of the parties that it affects. The scope of private law is not varied and the rights created by the private law have a limited scope. It is a right in personam meaning a right against a particular private individual or person. On the other hand public law is right in rem meaning it is a right that is available against the whole world, well, the immediate society (Balganesh, 2018). The scope of rights created by the public law is very varied as it affects a lot of things in society and in private lives of the individuals, the government functions and a lot more.

    2 - The case of Donoghue v Stevenson is a classic case that had laid down the foundation for the growth on the jurisprudence and legal principles of the law with respect to ‘Negligence’ and the ‘duty of care’. The facts of the case were that one Mrs Donoghue’s friend had ordered a ginger beer for her from a café in Paisley a city in Renfrewshire, England. Mrs Donoghue consumed half of the bottle which was an opaque black bottle and later on poured the other half of the contents in glass. When she did that she observed a snail floating in the beer, this caused extreme shock to Mrs Donoghue. Later on, Mrs Donoghue fell sick and she decided to sue the beer company’s manufacturer- Stevenson (Evans-Jones and Scott, 2018). The court awarded the judgment in favor of Mrs Donoghue holding that the manufacturers have a duty of care to the end consumers of their products specially in the cases where the defects in goods cannot be identified before the actual consumption as was in the present case. The case laid much emphasis on the iota of the duty of care that a manufacturer of the goods have towards the end consumers. Mere listing of the product for sale and supplying it to the retailers does not absolve the manufacturer from their duty of care (Goh and Round, 2017). In Donoghue v Stevenson what is to be observed is that there was no contractual relationship between Stevenson and Donoghue because it was Donoghue’s friend who had placed the order and had paid for her, therefore she could not claim breach of contract but only damages for negligence.

    In Hedley Byrne & Co Ltd v Heller & Partners Ltd the House of Lords had laid down the principles of duty of care even more elaborately. The facts of the case were that Hedley Byrne and Co Ltd was an advertising agency. One newspaper company that went by the name of Easipower Ltd gave a big order to the company. The company was not sure about the paying capacity of the customer and therefore, decided to seek an opinion from the bank of their customer which was Heller and Partners Ltd. The bank furnished a positive statement and also placed a disclaimer that the bank does not take responsibility for any conduct or statements. Easipower went into liquidation and Hedley suffered huge economic losses (Campbell, 2016). The company moved the court seeking damages for negligence and misleading information. The court held that the disclaimer provided by the bank was sufficient enough to absolve them from paying damages. However, the court did observe that the nature of the statements requested from the bank was a sufficient proximity to develop a relation of a duty of care, however, the disclaimer that the bank had provided was an embargo that prevented the Hedley from claiming damages for misstatements (Gordon, 2018). The court did go on to observe that it was important to lay emphasis on the fact that there was a duty of care on the part of the bank as they knew that the company will be acted on this statement of theirs. However, the disclaimer saves them from the liability as the service was rendered for free and no charges were asked for this statement that the bank had offered.

    Caparo Industries PLC v Dickman is another classic case of torts in England where again the principles of duty of care were discussed and opined on. In Caparo v Dickman the facts of the case were that Fidelty PLC was a company engaged in the manufacturing of electrical equipment and was a target of takeover by the Caparo Industries. Caparo knew the position of the company was bad and therefore started to buy the shares. Later on the accounts of Fidelty were audited by Dickman an accountancy firm and relying on the statement of audit, Caparo went on to buy more shares and acquired the company (Morgan, 2019). However, later on it found out that the position of the company was much worse and that Dickman had made misstatements. Caparo sued Dickman for the negligent behavior in making the audit statements. The court held that the accountant had no obligation to the investors and shareholders to reveal the actual position of the company the only duty it had was to the governance of the firm (Miller, 2019).The court had many issues to check in this case as there was a triparte agreement between Fidelty, the accountants and Caparo.The judgment did shed light on the fact that it is the right of the shareholders to know the exact position of the company but the potential investors or stakeholders do not enjoy this right.

    Section 2:-

    a - The nature of John’s advertisement is a legally binding offer. The advertisement was clear in terms of its intent to sell as an invitation to make a contract. The ad clearly laid down the intent to sell and the consideration for the same and the offer was made with a very categorical and clear disclaimer that John had the intent to enter into a contract (Durovic& Janssen, 2019). There needs to be three conditions for an advertisement to be a contract-

    1) The advertisement definite in terms

    2) Communicated to specific people

    3) Circumstances surrounding the offer show the intent to enter into a legally binding contract

    All the three conditions have been met in out in the case. This can be said because there was a similar case in history of England the case of Carlill v Carbolic Smoke Ball Company [1893] 2 QB 256. In this case a pharmaceutical company had advertised that there medicine the Carbolic Smoke ball could cure flu guaranteed and if it did not the company will offer £100. One person Carlill did not get cured with the medicine and sued the company. The court granted the decision in favour of Carlil and said that the nature of advertisement was that of a legally binding contract because the company has deposited £1,000 showing its good faith while circulating the offer. Therefore, in the present case it was a binding contract (Finnegan &Annola, 2016).

    b - Mick did not enter into a legally binding contract with John. This is because Mick did not accept the offer of John, what he did was to make a counter offer. The offer that John had given was that of £5000 cash and Mick offered to pay 4800 only and the manner of payment was also not clear. As per the common law governing the law of contracts when the communication of the acceptance of offer fails to accept the offer in its entirety and rather focuses on altering certain terms of the offer is termed as a counter-offer and not as an acceptance of the original offer (Smits, 2017). Therefore, a counter offer is like a rejection of the original offer and is a new offer in totality.

    c - In terms of the facts laid out from the currentcase scenario it is correct to say that Ronnie cannot sue John and accordingly does not have any right of action available in law against the actions of John. This is because Ronnie offered to pay the consideration of the offer in cheque. The offer that was made by John was that he will sell the painting for 5000 cash. This implies that the offer was for selling the painting for a consideration that is paid in cash and therefore the acceptance of Ronnie does not give him any rights whatsoever. What Ronnie did was to alter the terms of the offer and thus making it a counter offer by offering to pay via cheque (O'Sullivan, 2020). This gives Ronnie no rights because under the principles of law, a counter offer is like a new offer and a new contract.

    d - Charlie has a right to sue John as there was clear offer and acceptance of the terms of offer in the manner that was intended. The moment acceptance was communicated with a slight variation of getting some time to go to the bank to get the cash and John agreed to the same, it created a legally binding contract between the two parties (Perry, 2016). Charlie can sue John for breach of contract and claim damages for not reciprocating his part of the contract. In this case John has failed to perform his duty without any lawful excuse. Therefore, John is liable to pay damages to Charlie.

    e - John has a right to retain the money paid by Marianne. This is because once the offer has been clearly accepted and the acceptance has been duly received it becomes a contract. Moreover in the present case scenario, Marianne had even acted on the contract by executing her part of the contract. John was also willing to perform his duty under the contract. However, Marianne changed her mind and later on claimed her money back (Beale et al., 2019).


    Balganesh, S. (2018).Private Law Statutory Interpretation. S. Cal. L. Rev., 92, 949.

    Beale, H., Fauvarque-Cosson, B., Rutgers, J., &Vogenauer, S. (2019). Cases, materials and text on contract law.Bloomsbury Publishing.

    Campbell, I. D. (2016). The absence of negligence in Hedley Byrne v Heller. Law Quarterly Review, 132(2), 266-277.

    Ceil, C. (2018). The Development of Legal System in England and Wales. Available at SSRN 3520535.

    Chan, K. (2016). Public Benefit and the Substantive Public Law-Private Law Divide. Kathryn Chan, The Public-Private Nature of Charity Law (Oxford: Hart Bloomsbury, 2016).

    Conant, L., Hofmann, A., Soennecken, D., &Vanhala, L. (2018). Mobilizing european law. Journal of European Public Policy, 25(9), 1376-1389.

    Durovic, M., & Janssen, A. (2019). The formation of smart contracts and beyond: Shaking the fundamentals of contract law. Smart Contracts and Blockchain Technology: Role of Contract Law”,(L. DiMatteo, M. Cannarsa& C. Ponciboeds Cambridge University Press 2019)(forthcoming), https://www. researchgate. net/publication/327732779.

    Evans-Jones, R., & Scott, H. (2018). Lord Atkin, Donoghue v Stevenson and the LexAquilia: Civilian Roots of the “Neighbour” Principle. In Wrongful Damage to Property in Roman Law: British Perspectives. Edinburgh University Press.

    Perry, C. (2016). Good Faith in English and US Contract Law: Divergent Theories, Practical Similarities. Bus. L. Int'l, 17, 27.

    Smits, J. M. (Ed.). (2017). Contract law: a comparative introduction. Edward Elgar Publishing.

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