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CO5119 Business Law

tag 0 Download17 Pages / 4,153 Words
  • Course Code: CO5119
  • University: James Cook University
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  • Country: Australia

Questions

Peter owns and operates a fish supply company. He says to Jason (a long-time friend, and a supplier of commercial refrigerators): "I store my fish in a 2,000-litre refrigerator and it needs replacing. I want one that does not have any problems." Jason says: "Fujitsu refrigerators are the fridges I always recommend." 

Peter says: "The changeover must be smooth. I will be arranging for an electrician and plumber to install the new fridge. Thus, give me a firm date for delivery. Moreover, I supply fish to many restaurants and hotels. If there are disruptions, they will go elsewhere." They both agreed Jason would sell a 2,000-litre Fujitsu refrigerator to Peter and deliver it to Peter on the first day of the next month. 

An electrician and plumber agree to install the new fridge for $1,250. After Jason had delivered the fridge and it was installed, Peter transferred all his fish supplies into it. Three days later, the new fridge broke down. Peter called the electrician and the plumber to check what was wrong, and they found that the electronic components of the fridge are faulty. Unfortunately, the fridge cannot be repaired, and Peter immediately telephones Jason, who says that he will send a replacement fridge the next day.

Peter is terribly worried that his supplies will spoil. Therefore, he orders $200 worth of ice, to keep the fish cold. However, by the next morning, some of the fish has gone bad, and Peter has to throw them out. As he cannot send the pre - ordered fish to a prestigious Japanese restaurant, the restaurant owner, Turgay, says he will not accept any more fish supplies from Peter. This contract with Turgay was a one - year supply contract. 

As promised, Jason delivers a replacement fridge, and Peter gets the plumber and electrician in again, at a further cost of $1,250. In addition, the replacement fish supplies cost Peter $5,000, and Peter wants to bring an action against Jason, for a breach of contract, to recover the following: — $2,500, being the amount paid to the electrician and plumber. — $5,000, being the cost of replacing the fish that went bad. — $200, the cost of the ice — $20,000, the profit he would have made on the contract which Turgay has now terminated. Such contracts are very hard to get. — $1,000 for the anxiety he suffered while dealing with these events. 

Jason says he has now delivered a working fridge and denies any further liability to Peter under the contract. 

a) Explain clearly, whether Jason is liable or not, to pay for the damages that Peter suffered. If yes, for which of the claimed damages is Jason liable? 
 
Jason finds out that Peter has engaged a lawyer and is bringing an action against Jason and Elah Brody Pty ltd, the company for which Jason works. Jason went to Peter's office and asked that he stop the legal action against him and Elah Brody Pty Ltd. 
As expected, Peter declined Jason's request. Therefore, Jason told Peter quietly, "I know, as a close friend, that your son, Amery, owes a huge debt to loan sharks, due to the lavish wedding he had a year ago. If you carry on with the legal action, I will report your son's mounting debt to the police and his association with these low life criminals. They will see fit to arrest him and he will lose his job. Then you will have to help him, and that will bankrupt you, if you try to pay back his debt. I will also tell those criminals with whom he deals, about his arrest and they will give him a good beating for the amount of money he owes them." 
 
b) Explain clearly, if Jason subjected Peter to any form of duress and/ or undue influence. What are the consequences for Peter and Jason? 

While installing the replacement fridge, the electrician, Marin, informed Peter that a live wire is hanging from the side of the refrigerator. It will be dealt with tomorrow, as Marin did not have the required tools with him. Mahn has also asked Peter to ensure that no one touches the wire and mentioned that the fridge that Jason sent has some wiring problems. 

Peter, visibly shaken after Jason left the restaurant, did not notice the wire hanging from the side of the fridge and grabbed the cable, thinking it was the door of the refrigerator. Peter passed out from the shock of the live wire and fell head first against the table. When Peter woke up, he has a deep cut on the side of his face, and his hands suffered third-degree burns.

c) Explain clearly, if Jason and/ or Marin are liable for the tort of negligence.
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