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Question 1

Whether the last reply of Michelle is an invitation to treat or an offer and whether it is legally binding for Michelle to hold the offer for one week?

Rule 1

The difference between an offer and an invitation to treat is important since a contract cannot be formed after acceptance of an invitation to treat as provided in the case of Fisher v Bell. In case of an invitation to treat, the intention of the party is to invite another person to make an offer rather than bind himself into the contractual obligation. Furthermore, an offer that is once rejected is no longer available for a person to accept and the counter-offer is also constituted as a rejected as held in the case of Hyde v Wrench. In the case of Goldsbrough, Mort and Co Ltd v Quinn, it was held that a promise which is made to keep an offer open for a specific amount of time is not enforceable; however, if consideration is paid, then such promise binding. 

Application 1

In the given scenario, an offer was made by Jack to purchase the car of Michelle for $1,000; however, this offer was rejected by Michelle by stating that he will not sell his car below $1,500. This is a counter-offer made by Michelle which resulted in rejecting the original offer of Jack (). This is not an invitation to treat since Michelle did not ask Jack to make an offer for the car; instead, she gave him an offer for $1,500 (Fisher v Bell). Lastly, the promise made by Michelle to keep the offer open for one week is binding since consideration is paid (Goldsbrough, Mort and Co Ltd v Quinn).

Conclusion 1

In conclusion, the last reply of Michelle is an offer, and she is legally bound to keep the offer open for one week.

Issue 2

Whether the court is likely to uphold the exclusion clause of the Car Park that limits their liability to pay damages to Suzanne?

Rule 2

The exclusion clause is designed in order to limit or eliminate the liability of parties which arise in case they violate the terms of the contract. A person who wanted to rely on the exclusion clause has to ensure that such clause must be brought into the attention of another party before the contract is formed or during its formation as provided by the court in Thornton v Shoe Lane Parking Ltd. In case the terms are a part of a written contract, then they are enforceable on the parties despite the fact that they have read those terms or not as given in L'Estrange v F Graucob Ltd case. Furthermore, in the judgement of Baltic Shipping Company v Dillon, the court provided that if the exclusion clause is brought into the attention of the parties prior to the formation of a contract, then they are considered as valid. Furthermore, restrictions are given under the Australian Consumer Law that prevents parties from including exclusion terms into their contract. Thus, the exclusion clause is valid only if it is reasonable, obvious, clearly expressed, and business efficacy is present as given in BP Refinery (Westernport) Pty Ltd v Hastings Shire Council.

Application 2

In the given scenario, Car Park put a notice in front in which the exclusion clause was written which provided that it will not be responsible for loss or damages of the car. Suzanne’s car was stolen from the Car Park by a friend of the airport staff. As discussed in the case of Baltic Shipping Company v Dillon, the term was brought into the attention of Suzanne before the contract; thus, it is considered as valid. However, since the friend of the airport staff stole the vehicle, it is not reasonable to uphold the exclusion clause. As discussed in BP Refinery (Westernport) Pty Ltd v Hastings Shire Council, the exclusion clause is not reasonable and fair and it did not give business efficacy since Suzanne parked his car for its protection; thus, the court is less likely to eliminate the liability of the Car Park. 

Conclusion 2

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