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Validity of Contracts and Exclusion Clauses in Legal Cases

Case 1: Sale of Macbook Airs

Alfred who is 16 years old, surfs the web and finds an offer for the sale of Macbook Air lap tops at an incredibly low price of $200 each. He is fully aware that the current retail price was about $2000 and he knows that the low price must have been a mistake.

He decides to purchase five of them since it was quoted at such an unbelievable price He enters the credit card number of the supplementary card given to him by his father. The purchase goes through and the system responds with a confirmation of a sale of five lap tops at the total price of $1000. The shop that offered the sale now refuse to deliver the lap tops to Alfred. 

They argue that the online price information was a mere invitation to treat and also that Alfred has no capacity to enter into a contract. They also insist that $200 is not a sufficient price for a laptop that costs $2000. In addition they insist that their employee had made a genuine mistake and hence even if there was a contract it would be void. 

Discuss whether there was a binding contract between Alfred and the shop, considering all the five essentials of a valid contract.      (10 marks) 

Discuss whether the contract above would be valid or void on the basis of mistake.

           (10 marks)    



Mr. and Mrs. Brandon check in into East Coast Budget Hotel (ECB). They plan to spend their holidays in Singapore and this is their first visit to Singapore. They sign the guest card and make the payment. The guest card has the following exclusion clause printed in small print.  “The hotel shall not be liable for any loss or damage to property and any injury to guests”

 Mr. Brandon leaves his expensive camera on the bed without keeping it in the hotel safe. While having their morning breakfast at the restaurant they forget to lock the hotel room door. Mrs.Brandon slips on a pool of drink that was accidentally spilt by the restaurant staff. She breaks her hip as a result of the fall and is now suffering in pain. Mr. Brandon is shocked to realize that his camera is missing and probably stolen. 

Mr. and Mrs. Brandon intend to sue the East Coast Budget Hotel for their breach of contract and negligence. The hotel intends to argue that they are not liable for the loss of the camera and the injury to Mrs. Brandon since they signed an exclusion clause which protects the hotel. 

Discuss whether the exclusion clause would be valid and effective in protecting the Hotel from the claims.        (10 marks) 

          (Total 30 marks)   

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