COMMERCIAL LAW (200432), QUARTER 2 2015
ESSAY/ASSIGNMENT (Assessment 2)
Instructions
This document consists of two (2) pages including this page.
There are two (2) questions and both questions must be answered. This assessment task contributes 25% of your final grade. This assessment task is based upon the content covered in Week 4 and 5 (Module 2 and part of Module 3).
Word limit: The word limit for the entire assignment is 1500 words. There is no 10% margin of error on the word limit and you may not use footnotes to get around the word limit (eg, such as by placing extra text in the footnotes – footnotes should be used for the reference only as a general rule, not for added descriptions).
Referencing style: Assignments must be referenced adopting an appropriate business referencing style.
Submission: You must submit your assignment answers in accordance with the procedure outlined in the Learning Guide (i.e., must be submitted through Turnitin). The assignment must be submitted by the due date and time, or late penalties will begin to accumulate until received.
Please do NOT affix an Assignment Cover Sheet to your assignment. Assignment Cover Sheets are automatically built-in to Turnitin.
Do NOT attach a copy of these instructions, or of the questions, as part of your assignment, but number your answers to correspond to the numbered questions.
Marking: The marking criteria and standards are set out in the Learning Guide and will be used when marking and to provide feedback on your assignment. You may find it helpful to consult these while working on your assignment. See the Learning Guide for other information about marking and return of assignments, etc.
Assignment Due: Monday 18th May 2015 by 7 pm.
1. Petrochem Ltd manufactured and distributed chemicals, including the chemical boron tribromide. Boron tribromide was advertised in the Petrochem catalogue at a price of $300 per litre and was sold in glass containers carrying the warning label -harmful vapour-.
Boris Chemicals Ltd bought 100 litres of boron tribromide for use in its manufacturing business. Whilst the containers were being washed to remove the labels, a massive explosion occurred which seriously injured John, an employee of Boris Chemicals, as well as causing extensive damage to the manufacturing plant. Brian, a representative of Pool Chem Pty Ltd, was at the plant for an appointment to see about future deliveries, and was also injured.
John had accidentally dropped the container of boron tribromide into the sink. The container broke and caused the chemical to come into contact with water.
Both Petrochem and Boris Chemicals were aware that boron tribromide was dangerous in that it emitted harmful vapours. What neither party knew was that the chemical exploded on contact with water. Although it was not widely reported, this property was to be found in the scientific literature extending from 1897 to 1988. Three books detailing the reaction were found in Petrochem's library. However, in researching the chemical, Petrochem did not consult these older journals but rather relied on more recent publications which did not refer to the explosive reaction with water.
Boris Chemicals Ltd and Brian seek your advice as to what legal action, if any, may be taken against Petrochem Ltd under the law of negligence. (15 marks)
2. John was very keen to own his own car. Ward, John’s neighbour, had recently retired and he and his wife were selling everything and moving to the North Coast. John asked Ward what he would sell his car for and he replied that he wouldn’t sell it for anything less than $15,000. John said he probably couldn’t afford that much. So Ward asked him what he could afford and John replied “realistically, only $10,000”
About a week later, Ward spoke to John over the fence and offered to sell the car for $10,000. John said he would talk to his father and get back to him. The next day John phoned Ward but he wasn’t home. John left a message on the answering machine. An hour later John saw Ward’s wife in the garden and so spoke to her. She said she didn’t know anything about the arrangement but she would pass on John’s message that he wanted to buy the car for $10,000. John was really keen to get the car because he knew it had been well looked after so, to confirm the deal, he wrote a letter and put it into Ward’s letterbox stating that he accepted Ward’s offer, subject to obtaining finance on satisfactory terms from his father.
John’s father promised to lend him the $10,000 on favourable terms provided he was a careful driver.
Two days later Ward phoned John’s house and spoke with John’s mother asking her to apologise to John letting him know he would not be selling the car at all but taking it with him.
Does John have any contractual claim against Ward?
Does John have any contractual claim against his father? (10 marks)