Law Assignment: Q&A based on Business & Corporate Law Cases

Question

Task
The questions to be answered in this law assignment are:

Question 1: Are ‘law’ and ‘justice’ one and the same thing? Discuss.

Question 2: While jogging around his suburb one morning, Pedro sees a speedboat parked outside a house. There is a sign posted on the boat’s windshield saying:
“For sale $9,000, Text Andres on 0409876543. Direct buyers only!”

A boat lover, Pedro calls the number advertised and leaves a voice message saying that he’s happy to buy the boat for $7,000. He also leaves his return number.

Andres is busy all day, and only hears Pedro’s message the next morning. He calls Pedro back; he also leaves a voice message saying that Pedro’s price is too low, but he can get the boat for $8,000. That same day, however, another buyer sees the boat and makes a $9,000 cash offer to Andres on the spot. Andres takes the money, signs over the boat’s registration papers, and the buyer tows the boat away.

Pedro passes by Andres’ house and sees that boat is gone. Panicking, he listens to his voice messages and hears Andres’ message for the first time. He calls Andres right away and told him in no uncertain words that he accepts his offer. Pedro now thinks he has accepted Andres’ offer so they now have a contract.

When Pedro finds out that the boat has been sold to someone else, he gets very angry. He argues that he had already accepted Andres’ verbal offer, so he had no right to sell the boat to the other buyer.

Does Pedro have a valid contract with Andres and he entitled to the boat? Explain with reference to all the elements of a valid contract.

Question 3: Samuel Finley has two children, a daughter Lee and a son Keaton. Samuel has a lovely beach house in Palm Beach. Sam is terminally ill and has been told by his doctors that he has less than a year to live.

Lee knows that Keaton is their father’s favourite child and that he had been named in the latter’s will to inherit the beach house. Lee knew that since their father did not have long to live and that he was 90 years old and starting to become mentally-weak, she could pressure him to transfer the Palm Beach beach house over to her even though Samuel may not totally understand what he was signing over. So, for four months, using pressure and threats, but more often with gentle but devious tactics, Lee succeeds in convincing Samuel to sign a transfer of property transferring the Palm Beach beach house over to her.

As his last act, before he dies, Samuel wants to set aside the transfer of the beach house to Lee. Advise him of his legal position.

Question 4: Answer the following, citing relevant legislation and case law in your answer:

• What is the parol evidence rule, and what is the court’s reasoning in applying the rule?
• List and explain the exceptions to the parol evidence rule.

Question 5: TermiFab is a steel fabrication business operating in Adelaide. The business is owned by Pedram. The business has a current 10-year lease of the factory where its manufacturing operations are run. Pedram has just been awarded a contract to supply steel frames that will be used in the building a commercial shopping centre in the Adelaide CBD. Under the contract, Pedram will start supplying steel frames to the shopping centre developer in 90 days.

The construction period is estimated at 24 months, and Pedram is expected to supply steel frames for 16 of those months.

Two months before the delivery date of the first supply of steel frames to the shopping centre developer, the South Australian Government compulsorily acquires the site of Pedram’s factory. The factory happens to be along the route of a new tunnel link system that the government will start building.

Pedram’s lessor advises him that he has to leave the premises within four months as provided by the lease contract. Pedram now has a massive problem: he must find new premises for his factory, and it might be another two to four months to establish the factory before it can start making steel frames. It is now clear that he cannot deliver the first supply of steel frames to the developer in time.

Pedram comes to you for advice. You are expected to advice on whether his contract to supply the steel frames with the shopping centre developer can be discharged by frustration. You must cite relevant provisions of law and cases in support of your answer.

Answer

Question 1
The concept of justice and law are often misinterpreted and confused by many people (Donnelly and Whelan, 2020). Although, they are connected strictly with each other and these two things are not at all same. Justice is based entirely on equal rights, morality and fairness. Conversely, the law is defined as a set of standards and regulations set up either by international bodies or governments to offer justice to the people. Moreover, the norms of laws are written that are regulated by the governments as and when required. The two terms are briefly described below.

• Laws
  Laws are guidelines and rules that are enforced and established by the entities of the government and the government itself. According to Marchlewska, Cichocka, Panayiotou, Castellanos & Batayneh (2018), the rules of laws vary from one country to the other. As per the laws of Saudi Arabia, the punishment for murder is beheading with a sword while in other countries the punishment for murder is life imprisonment or fine or death sentence to the person depending upon the level of cruelty. The norms and principles associated with national laws are to regulate the individuals and their citizen’s behaviour under the jurisdiction of the government.

• Justice
  As mentioned by Deland, Klamberg & Wrange (2018), justice is a concept which is based on equal rights on kindness, ethics, dignity, fairness and moral. Justice is given to the one who needs support to get rid of the problems. As an example, domestic violence is a common thing that happens in various countries, but unless the women would not register the case against their in-laws then it is not possible for them to get justice. The government has standard laws for domestic violence too. Indeed, some people take advantage of laws and register a false case against their in-laws. This is the reason for delayed justice in certain cases.

Question 2
As mentioned in the case, Pedro was excited to buy the speedboat which was priced at $9,000. Although, Pedro sent a voice message to the seller named Andres that if the price of the boat would be $7,000, then Pedro would happily buy the boat. However, the seller sent the return voice message saying that the buyer can get this boat at $8,000. The next day another buyer bought the boat at the selling price and the seller signed on the registration paper of the speedboat as well as the agreement was finalized between the two parties. Moreover, in this entire voice conversation, there was no such agreement made between Pedro and Andres. The seller neither accepted to sell the speedboat to Pedro nor do Pedro promised to buy the item at the $8,000. However, Pedro agreed to buy the boat when it was already sold by the seller. Therefore, this cannot act as evidence. Indeed, there is no written evidence or proof for the same. Moreover, Andre can show the written document and after that, the offer was accepted by Pedro. Therefore, a contract could be said as valid if it has proper documentation or agreement on which both parties must accept the terms and conditions. Communication between the parties is essential and if the buyer has a craze for anything then it is essential to get in continuous touch with the seller. Due to delayed communication or Pedro delayed in listening to the voice of the seller. While the other buyer directly spoke to the seller and made the contract of the boat. Therefore, Pedro must have to understand that the delayed decision made this mishap to happen. Pedro needs to understand that no agreement was made from the seller that comprises acceptance of the offer. The contract can be termed as valid if the contract is clear and precise but not vague. Therefore, the contract with Pedro was vague as per the perspective of the seller. Indeed, the seller has not agreed with Pedro. The actual contract was made with the buyer and registration of the boat was made. This is a clear contract and no ambiguity can be found.

Question 3
Transfer of property means that the owner of the property has the right to transfer its property to anyone. The owner with consent can transfer the property to any one of the family members. In this report, since the owner would survive for a very few months for which the owner’s daughter implemented certain tactics to keep a hold on the property owned by the owner. Although, there must be the consent of the owner for transferring the property else the owner can take legal action for any forceful or unlawful action for the same. The name of the nominated beneficiary must be there in the will and the owner can transfer it based on its interest.

The owner of the property can file a civil lawsuit mentioning the actual problem and issues faced by the owner. In this case study, the daughter planned various ways to torture Samuel Finley so that the father cannot transfer the same to its only son Keaton. Samuel Finley was 90 years old and has hardly some days left for the survival of the owner, the daughter used strategies and techniques to transfer the Palm Beach house and later succeeded to transfer the property. Thus it could be difficult for Samuel Finley to win the case. Although, the owner can case against Lee by stating the mental and health condition through which the person is going through and can pray the court to take necessary actions. It can be considered by the court and depending upon the situation the court can decide the appropriate action. However, the property owner should file a case against the unlawful way of transferring the property. The laws of the country are standard and set differently in countries. Therefore, the person or the owner should file a complaint that the person does not have the consent on the transfer of the property (Roberts and Stewart, 2019). According to the view of Ibrahim, Salleh, Mohd & Laeba (2019), the illegal methods were used and tortured mentally and physically for the transfer of the property owned by the owner. Depending upon the mental condition of the person, the court can make its verdict. Therefore, the owner can take appropriate action against its only daughter Lee.

Question 4

1. The word “parole” is similar to the phrase “the parole evidence rule” but it is not at all linked with a crime or criminal law. The rule is based on the contract law policy of the government in which none of the parties can modify, vary or contradict the written terms and conditions through extrinsic evidence. As stated by Zeffertt, Paizes & Skeen (2017), the parol evidence rule can be defined as the legal doctrine and does not base on the evidence produced from outside. However, oral discussion and other legal shreds of evidence can be made before finalizing any written agreement.
2. In the parol evidence rule sometimes the disputes in contracts concern both the parties’ obligations and rights based on the contract (Fugate, Gasper & Schmitt, 2018). To solve the disputes related to parol evidence rule, the court or more precisely the judge goes through the terms and conditions of the contract. In short, they determine the promises that were made by the parties at the time of forming and signing the contract. Although, exceptions to this rule and are accepted by courts. In case, the parties agree upon the unwritten facts that may affect the agreement in the future, then this rule has to accept that possibility. Therefore, in certain situations, the parol evidence rule is not applicable. They are mentioned below.
• As mentioned above, if the contract made is partly oral and partly written. Therefore, the first exception of this rule is that the agreement is not based on a complete written contract in that case the rule is not applicable. It states that the extrinsic evidence would be permitted if both the parties can prove that the agreement consists of written and oral terms.
• The second exceptions are that when the contract was formed, both the parties assumed that the important terms are mentioned. However, in case of missing terms in the agreement then the parties may present the verbal evidence to the court. Moreover, this contract is based on the partly oral and partly written agreement.
• The third exception to this rule can be invalidation in which the claimant can look forward the repudiating the penalty associate with the agreement. The claimant may discover the contract that was made is based on invalidation and mistakes.
• The fourth exception of this rule, in case of verbal evidence there would be an ambiguity to identify the parties of the deal. As evidenced by Taleb and Eftetahi (2019), it is especially when the outside evidence is required to understand the subject matter of the contract.

Question 5
Yes, the product discharged by the supplier would be by frustration. Frustration is a law doctrine that recognizes an unnatural event that can suddenly occur and none of the party had any fault in this radical change. It can be impossible to perform under such circumstances. As mentioned in the report, the government necessarily acquires the factory site of Pedram to make a tunnel link system. Unfortunately, before signing the contract with the shopping centre for the supply of steel frames then it would be easier for Pedram to agree on the number of frames the company can afford to deliver. However, things are not under the control of Pedram. The frustration is natural as Pedram had to look for another site within 4months as the lesser asked the manufacturer to vacant the place. Since the order was enforced by the Australian government. This sudden mishap had changed everything for Pedram as stated in the report. According to the view of Pawlowski and Brown (2018), it is impossible to overcome the occurrence of this type of disaster. As per the contract law rule, it is mandatory to keep the promises irrespective of the circumstances. At the time of the agreement, the risks are also written and either party had to follow the rule. As an example, the contractor may sometimes write in the contract that the written things must be acquired in any circumstances. Suppose, if a shopping mall had given a contract to the third party to complete the mall within 6 months. The other party had to follow the norms to complete the task within the stipulated time frame. In case, the contractor face problem to find skilled labour or having a shortage of workforce to execute the work on time. Moreover, these shortcomings are not the responsibility of the owner of the mall. Indeed, the owner's main focus is to get the outcome within the stipulated time mentioned in the contract. In this case, the disaster affected only one of the parties. Thus, they cannot perform their work enthusiastically. As mentioned in the report, the steel frame manufacturer is not being able to perform the work efficiently. Additionally, because of this sudden disaster, they are not being able to supply the steel frame within the time frame as per the contract. Moreover, it was an unexpected thing that happened and it is not always possible to mention every risk while signing up the contract. However, the principle of frustration is an order from the court in which the contract would immediately end up in a difficult situation. Moreover, it is not the fault of an individual for a sudden disaster and obviously, the disaster was not foreseen at the time of contract. As per the view of Callister et al., (2019), the only probable reason for the failure of the contractual duties was the sudden mishap. More to this context, in case of an extraordinary circumstance, the doctrine of frustration is valid (Voie, Tunby & Strømsvik, 2018). This rule is valid in case if one of the parties cannot be able to fulfil the demands and requirements of the other party due to the interference of the government. Therefore, this law can be applied and the other party must be able to terminate the contract legally without any fear of penalty. Thus, Pedram can legally proceed to overcome from this unfortunate situation.

References
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Fugate, C., Gasper, G., & Schmitt, P. (2018). Protecting Your Franchise Agreement: Understanding Exceptions to the Parol Evidence Rule. Franchise Law Journal, 37(4), 507-522.

Ibrahim, B. H., Salleh, M. C. M., Mohd, A., & Laeba, M. (2019). Dealing with Unlawful Sources of Funds Among Islamic Banks in Malaysia: The Practitioners’ Perspectives. In Emerging Issues in Islamic Finance Law and Practice in Malaysia. Emerald Publishing Limited.

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