Case Study Contract & Negligence Related Issues

Case Study

•Contract related issue•Negligence related

issue

Case study 1- Contract Issues:Factual background:• Edward and Jane are husband and wife.• Jane wanted to buy a coffee shop but wanted to refit the shop.• She gave the task of refitting to her husband Edward and the cost of refitting the

shop was $40,000.• She orally promised her husband to repay the money within 1year.• She wanted to expand the coffee shop and wanted to buy a new area adjacent to her

coffee shop. • She spoke to her bank manager for loan but he did not want to pay the loan because

of non payment to the loan to her husband.• Jane gave $10,000 to her husband and he provide a written confirmation to her in

regards to full payment of the dues.• Edward though she would him the job of refitting to the new coffee shop to him but

she gave it to Max. • She engaged with Max and wanted to give divorce to Edward.

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Issue:The main issues in this context are regarding:• Determination of the legal position of the parties in this context.• Validity of oral agreement.• Validity of contract between the family members.




Rules:

• 1st matters is relating to the validity of oral agreement and its enforceability. For an oral agreement there must be some mutual consent by the parties.

• 2nd matter relates to the contract between family members. Because in maximum family contracts, there are no actual legal intentions.




Application:• There was oral agreement between husband and wife. So Jane is

liable to pay the full amount.• They are husband and wife so the happiness in the relationship is

also necessary.• They entered a new contract which is written and regards to the

final settlement. The consideration amount is $10,000. • The position of Edward is weak in suing Jane, even if she provided

the work to Max or further wanted to give divorce to him because he never expressed his wish to refit the new coffee shop to his wife.




Conclusion:•No breach of contract.




Case Study 2- Negligence issue:Factual background:• Jean went to Top Star Supermarket regularly. • One day she slipped on certain grapes and fell to

the floor.• Manager told that there were a hip of spillage on

aisle in every weekend.




Issue:• The issue is relating to the determination of the liability of

the supermarket in this case.




Rules:• As per the rule of Donoghue v Stevenson [1932] AC 562 ,

the defendant has to fulfill the adequate duty of care in regards to plaintiff.

• The damage of the plaintiff can be foreseen by the defendant.

• The third important thing in the case of negligence is that whether there was actual damage of plaintiff or not. Damage can be physical or financial.




Application:• Jean is the customer of the supermarket so the staffs of the

market has the responsibility to take proper care to her. • The supermarket authority did not take adequate action or

measures to eradicate the problem. • The damage clearly indicates the act of negligence.




Conclusion:• All the conditions are fulfilled so the Supermarket

authority is held to be negligent in this case.




References:• Gibson, A & Fraser, D 2014. Business Law, 8th edition, Pearson

Publications, Sydney• Latimer, P 2005. Australian business law, 24th edition, CCH

Australia Ltd. Sydney• Pendleton, W & Vickery, N 2009. Australian business law:

principles and applications, 7th edition, Pearson Publications, Sydney




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Case Study Contract & Negligence Related Issues