LAW501

Revision Questions_Lecture_Week 7

Short Answers:

1. Explain the difference between a sole-trader business and a company. Are they limited liability
or unlimited liability?

2. Differentiate between a civil case and a criminal case.

3. Who is a “minor” as per common law? When would contracts with a minor be deemed as valid?

4. Case Law: Adam v Lindsell:

When did acceptance take place? Explain your answer with the appropriate rule of acceptance

5. What is the difference between duress and false imprisonment?

6. Explain the tests that a plaintiff needs to prove in order to succeed in a negligence claim.

7. Johnny is suing Peterson for defamation. In order to succeed in claiming damages against
Peterson, explain the elements that a Johnny needs to prove.

CASE STUDIES

Case Study 1

Silcraze City Council owns and operates a Gym. It charges $20 per month as membership fees. On the
Gym Membership Card it is written that the Cardholder has the right to use all the equipment in the
Gym. The Gym contains various sorts of fitness equipment. One day the only Bench Press (One Gym
Equipment) breaks down and the Gym Owners place a sign in ‘red’ beside the Bench Press, which states;
“Do Not Use This Equipment. It is Broken.”

Advise Silcraze City Council of its liability towards James (a blind member) who uses the Bench Press and
is injured as the equipment is broken.

Case Study 2

Mr. Husband, one night promises his wife that he would buy a diamond-set for her upcoming birthday
following month. Mrs. Wife, is very excited with the offer and she accepts the promise by willing to cook
meal for the rest of the month for her husband (instead of their normal take-away dinner routine). She

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also tells all her friends that she is getting a diamond-set in her birthday and hence she invited many of
her friends to her birthday. However, on her birthday, instead of a diamond necklace, she was given a
normal silver necklace. Mrs. Wife is furious after seeing a silver necklace instead of a diamond-set. She
further feels humiliated in front of her friends who were also expecting to see the new diamond-set.
Mrs. Wife is contemplating legal action against his husband.

Advise what legal action(s), if any, she can take under common laws using case law(s) and relevant
example(s).

Case Study 3

A radio station wanted to generate a favorable discussion in their talk back show regarding a rumor
involving a prominent doctor. The radio announcer stated that “The rumor that Dr. Xfren Sheila of
XSheila’s medical practice is an immoral adventurer who sleeps with her patients for additional money is
not true”. Dr. Sheila is astounded with the remarks by the radio announcer and the station (though it
was stated that the rumor was not true). As a result, many of her clients opted to withdraw their
membership from the clinic.

Advise what legal action(s), if any, she can take under common laws using case law(s) and relevant
example(s).

Tutorial 6

Short Answers

1. Which groups of people are presumed by law to have no capacity or limited capacity?

2. What types of contracts with minors are valid?

3. Under what conditions will a mentally unsound and intoxicated person not be legally bound to
enter a contract?

4. List the 5 main causes for absence of consent.

5. With respect to contracts, differentiate between a common mistake, a mutual mistake and a
unilateral mistake.

6. List the three different types of misrepresentation and briefly explain each one of them.

7. Differentiate between “duress” and “undue influence”.

Cases

1. Hocker suffers from the mental illness of manic depression. Last month he decided not to take
his medication and had an ‘episode’ in which he believed he had won the lottery. Hocker
entered two contracts during this time:

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 (a) With Pannam for $500 worth of groceries; and
(b) With Cheshire for a Ferrari sports car.

Three weeks after going back on his medication Hocker told Pannam he would not pay for the
groceries because he lacked mental capacity. Hocker knows he cannot pay for the sports car,
but so far he has not contacted Cheshire and tried to withdraw from the contract. Explain, giving
reasons, whether Hocker is likely to be legally bound by either contract.

2. When Marymount Mines (MM) ordered urgently needed equipment from a supplier in
Melbourne. It gave ‘Marymount Mines via Maryborough’ as the delivery addresses. The supplier
shipped the goods to Maryborough, Victoria. Unfortunately, the mine was located near
Maryborough, Queensland. The delay in delivery has cost MM several thousand dollars’. Explain
whether it would succeed in an action based on ‘mistake’.

3. Saul needed money in a hurry. He sold his suburban news agency to the first buyer he could find
for $125 000, which included $25 000 for the goodwill in the business. The company that bought
his business included a clause in the contract that stated: ‘The vendor shall not commence or
purchase a news agency within 50 kilometer radius of the existing news agency for ten years’.
One year later Saul is willing to go to court to fight for the right to start another news agency
within a 10 – kilometer radius of the old one.

(a) Discuss three factors the court is likely to consider.

Tutorial 5
Short Answers:
1. Define a valid contract. State the six essential elements of a valid contract.

2. What are the things that make a contract valid?

3. State the objective test for intentions.

4. Define an agreement.

5. Differentiate between domestic agreements, social agreements and commercial

6. When can a presumption be denied?

7. State some of the rules regarding offers.

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 8. State some of the rules regarding acceptance.

9. State some of the rules regarding rejection of offers.

Cases:
1. An elderly Perth widow invited her niece to leave the Philippines to come to Australia.
The plan was for the niece and her husband to move into the widow’s mansion to keep
the widow company for the remainder of her life. The couple was promised that all the
widow’s property (a substantial amount) would be willed to them. The niece left her
lucrative acting career, and her husband resigned from a high government position, to
make the move. After a few months of sharing the house, the widow became annoyed,
ordered the niece and her husband to leave and changed her will, leaving everything to
various charities. Can the couple take court action to enforce the agreement with the
widowed aunt?

2. Frank decided to sell his surf ski and advertised it ‘For Sale’ in the Trading Post for $600.
Cindy came round to look at it and said she was willing to pay the $600 if Frank included
his flippers and goggles. Frank said he would need $650 if the flippers and goggles were
to be included. Cindy then offered $550 for the surf ski only. Frank said he would sell for
$580 and not a cent less. Cindy then offered $625 for the surf ski, flippers and goggles.
Frank agreed to that price, and the money and gear were exchanged. Identify any
invitations to treat, offers, counter-offers and acceptances in the transactions that led to
the surfing gear.

3. Cathy borrowed $3000 from co-worker, Tahlia and promised to repay her the total
amount by 31st December. When the date arrived, she said to Tahlia, ‘I can only pay you
$500 now and $500 every six months until I have paid you $2500. But I won’t be able to
pay you more than that’. Tahlia accepted the $500 and then sued Cathy for the balance
two months later.

(a) Could Tahlia obtain a court order directing Cathy to pay the full amount?
(b) Would your answer be different if Cathy had approached Tahlia before the due date
and Tahlia agreed to the new repayment arrangements?