1. Demonstrate a working knowledge and understanding of the principles of Australian business law within the context of the prescribed readings.
2. Identify and analyse relevant facts, problems and legal issues from a given scenario and develop an argument in response, discussing available options in
the context of business law.
1. For the arrangement of business, compliance is an important part of managing and establishing a business in any part of the world. Compliance refers to the process in which confirmation is given to the manufacturer, dealer or supplier of the business who meets the required standards or requisites for establishing and running a business (Farrington and Palfreyman 2012). Hence, we may conclude that for the establishment of a business, compliance has become an important part in which a regular check is conducted irrespective of what kind of business one shall establish.
The main aim of introduction of the compliance process in any business was to ensure that the people who are involved in the processes of business act in a responsible way. An individual who runs a business should comply with the state and national laws and apply the set of laws to his business that helps him in the identification of legal issues and risks and this is what compliance demands (Bridge 2015). Therefore, people who plan to establish a business should meet with the required standards before establishing a business. Compliance requires a regular check to be conducted to match the efficiency of the trained employees. It is beneficial to have an intact compliance laws as it helps in achieving a good reputation for the business and also helps in increasing the productivity of the business (Ghanavati, Amyot and Peyton 2011). Non-compliance of rules, standards, legislations and laws can lead to penalties such as compensation or liquidation of the company. In Australia, the laws related to compliance are very strict and people who are to set up new business should comply with Australia’s rules of compliance. If businesspersons fail to comply with the laws of Australia then he or she may have to face penalties. The Acts that regulate formation and establishment of business in Australia are Intellectual property laws, Consumer laws and Sales of Goods Act.
In the given case study, my family and I run a seafood restaurant in Sydney and I wish to call it the Great Catch! The property in which the restaurant is located is a joint tenancy and I hold it as a freehold estate. I share the joint tenancy with my wife. According to the Property law of Australia, property can be classified under two heads: Real Property or Personal Property. Real property is a property in which the encumbrances are considered as part of the land. Whereas, Personal property is the one in which the property is owned in the form of intangibles or chattels (Bradbrook et al. 2011). Thus, in Australia the property laws are beyond that merely having ownership rights over a piece of land. Consequently, a legal interest is created in the property, which I owe and on which my restaurant runs. A legal interest is created over a property, the moment all the laws are complied with for the formation of a business (Crosbie and Glantz 2012). I have complied with those rules and hence I have a legal interest over the property in which I run my business. I have ownership over the property and hence I have the authority to use all the legal rights and obligations arising out of my ownership. Fee simple ownership gives exclusive right to the property owner to sell, mortgage, lease or transfer the property (Corones 2013). The property that I owe is run by joint tenancy with my wife. Joint tenancy means when more than one owner owns the same property (El Kharbili 2012). The owners of the property are referred to as joint tenants. Joint tenants have equal share and undivided share in the property. They have similar rights and authorities in the property and they may dispose of the property according to their wish. Right of survivorship is created in the joint tenancy; this means that if one of the owners dies, then the other owner shall automatically become the owner of the property. Joint tenancy is the best ownership right that couples may have when running a business together (Farrington and Palfreyman 2012).
Owning a seafood restaurant in Sydney means ensuring that the consumer laws of Australia are complied with. In Australia, there are many provisions available for protecting the rights of consumers such as Australian Consumer Law, Sales of Goods Act and Trade Practices Act. According to the definition that is provided in the Australian Consumer Law, a consumer means and includes a person who acquires services or goods for domestic or household purposes (Ghanavati, Amyot and Peyton 2011). Section 29(1)(a)(b) of the Australian Consumer Law deals with the quality or standard of goods that are sold by the seller to the consumer. As per this section, the goods sold should be of acceptable quality and should serve the purpose for which it was purchased (Kolivos and Kuperman 2012). According to section 54 of the Australian Consumer Law, a product that is supplied or sold by the seller shall automatically be considered of acceptable quality and failure to provide such goods or services may attract penalties (Latimer 2012).
The name of my restaurant shall be “good catch.” Hence, we will have to protect the name of the restaurant under the Australian Intellectual property. An individual acquires exclusive right under which he shall want to protect his work, name or logo. Such name, logo or work is an outcome of using his intellectual idea and hence he seeks protection over such idea. The protection may be provided under Australian Intellectual Property Law (Schwartz 2012). In the same way, I shall want to protect the name and logo of my restaurant as a registered trademark. Trademark is a symbol or sign that is used to differentiate between two identical businesses running together (Shopping 2013). Therefore, if there is another seafood restaurant in Sydney then by the name of my restaurant people shall be able to distinguish them. This is the use of having a registered trademark. Trademark means and includes tickets, letters, words, names and signatures (Solomon, Russell-Bennett and Previte 2012). Trademark is applicable for color, shape, size and sound as well.
Hence, we may conclude that compliance with intellectual property laws, consumer laws and property laws is very important for the successful running of the business. Non-compliance with any of the laws stated above shall lead to penalties which may affect the cost and running of my business.
2. Many and Bella are married couples since the year 2008 and they run a pizza business in the city. The name of their business is Perfect Domino Pizza. They required a new oven for their business and they visited Tuscan Ovens Pty. Ltd for buying the same. As per their requirement, they wanted an oven that had the capability of making 30 pizzas every hour for sixteen continuous hours every day. The Manager of Tuscan Ovens Pty. Ltd assured Manny and Bella that the Tuscan XX oven shall meet with their requirements. Manny and Bella purchased the oven for $15,000.
Many and Bella advertised the Tuscan XX oven with a different name and called it MB Oven. After installation of the new oven, it was noted by them, that the oven could make only 12 pizzas in an hour and such an oven is highly unreliable. Gradually, it was seen that Manny and Bella are suffering a loss for such an oven due to the incapability of the oven of making 30 pizzas. Based on the facts, the issue that arises here is, whether Tuscan Ovens Pty. Ltd can be held liable for selling the oven to them wrongfully.
The Australian Consumer Law contains a set of rules that provides protections to any person or organization as a consumer of any goods or services. Section 3 of the ACL, defines consumer as a person who acquires goods or services that costs less than 40,000 dollars. Additionally a person may also be treated as a consumer if he or she buys goods for more than 40,000 dollars but the goods bought are used for personal or domestic use (MacDonald et al. 2011). The Australian Consumer Laws (ACL) came into existence on January 1, 2011. The ACL is considered as a single statute for protecting consumer rights in Australia. According to the definition that is provided in the Australian Consumer Law, a consumer means and includes a person who acquires services or goods for domestic or household purposes (Maskus 2012). Similarly, Section 4B of the Trade Practices Act also describes the word “consumer.” Section 18 of the Competition and Consumer Act, 2010, deals with misleading or deceptive conduct of the sellers or retailers (Turconi et al. 2011). According to section 18, a seller or retailer should not conduct any behavior with the consumer that shall be considered as misleading or deceptive in nature. The misleading or deceptive nature of the seller can be collectively termed as misrepresentation of facts. This means that the seller or the retailer should state facts that are true and should match with the requirements of the consumer.
In the famous case of ACCC v. TPG, the High Court held that the advertisements that were displayed by TPG for ADSL2+ services are misleading and deceptive in nature as the costs that were displayed in the advertisement was not the final cost and that additional costs were added to it at the time of installation of the service. This advertisement was held as misleading or deceptive in nature (Vom Brocke and Rosemann 2010). The Court held that TPG has violated the provisions of section 18 of the ACL. Similar to section 18 of the ACL was another section 52 of the Trade Practices Act that also spoke about misleading or deceptive nature of the sellers towards their consumers. Based on the judgment that is provided in TPG case, the manager can be held liable for misleading or deceptive nature which are in violation of the Competition and Consumer Act 2010.
In the same way, Manny and Bella are misled and deceived by Tuscan Ovens Pty Ltd. Initially, the manager promised that the oven should cook 30 pizzas however, later they discovered that the oven could not cook more than 12 pizzas in one hour. This untrue statement by the manager of Tuscan led to monetary loss of their business and they had to bear huge financial responsibilities. Thus, Manny and Bella can file a suit against Tuscans for misleading or deceptive conduct. It is illegal for a business to engage in a practice that misleads or deceives any customer or has the likelihood of misleading or deceiving the customers. According to Australian Consumer Law, violation of section 18 is subject to remedies such as damages, injunction or compensation (Farrington and Palfreyman 2012). The damages and the remedies are contained in chapter 5 of the ACL. Section 18 of the ACL allows a person to seek remedies for the harm they have suffered for the breach of the laws contained in ACL. Thus, the manager can be held liable under section 18 of the Australian Consumer Law and section 54 of the Australian Consumer Law. Section 54 of the Australian Consumer Law also deals with misleading and deceptive conduct of the sellers. In the same way, Manny and Bella can also be held liable for breach of section18 of the Australian Consumer Law. The reason behind this is that they changed the name of the original oven and advertised in some other name. Hence, Manny, Bella and the Manger of Tuscan can be held liable for breach of section 18 of the Australian Consumer Law.
Conclusively, it may stated that the Australian Consumer Law is the most indispensable law in Australia to protect and conserve the Australian consumer rights. This law is regarded as a revolutionary change in the consumer law of Australia and it has superseded all the existing laws of Australia concerning consumer protection. Hence, when infringement or violation of consumer law takes place, seeking remedies from Australian Consumer Law is the best of all other remedies.
Bradbrook, A.J., MacCallum, S.V., Moore, A.P., Grattan, S. and Griggs, L.D., 2011. Australian property law: cases and materials.
Bridge, M., 2015. Personal property law. OUP Oxford.
Corones, S.G., 2013. The Australian Consumer Law. Thomson Reuters, Lawbook Co..
Crosbie, E. and Glantz, S.A., 2012. Tobacco industry argues domestic trademark laws and international treaties preclude cigarette health warning labels, despite consistent legal advice that the argument is invalid. Tobacco control, pp.tobaccocontrol-2012.
El Kharbili, M., 2012, January. Business process regulatory compliance management solution frameworks: A comparative evaluation. In Proceedings of the Eighth Asia-Pacific Conference on Conceptual Modelling-Volume 130(pp. 23-32). Australian Computer Society, Inc.
Farrington, D. and Palfreyman, D. eds., 2012. The law of higher education. OUP Oxford.
Ghanavati, S., Amyot, D. and Peyton, L., 2011, August. A systematic review of goal-oriented requirements management frameworks for business process compliance. In Requirements Engineering and Law (RELAW), 2011 Fourth International Workshop on (pp. 25-34). IEEE.
Kolivos, E. and Kuperman, A., 2012. Consumer law: Web of lies-legal implications of astroturfing. Keeping good companies, 64(1), p.38.
Latimer, P., 2012. Australian Business Law 2012. CCH Australia Limited.
MacDonald, C., McCrimmon, L., Wallace, A. and Weir, M., 2010. Real property law in Queensland.
Maskus, K.E., 2012. Strengthening intellectual property rights in Asia: Implications for Australia. Welcome to the electronic edition of Australia’s Economy in its International Context, volume 2. The book opens with the bookmark panel and you will see the contents page/s. Click on this anytime to return to the contents. You can also add your own bookmarks., p.409.
Schwartz, M.S., 2012. The state of business ethics in Israel: A light unto the nations?. Journal of business ethics, 105(4), pp.429-446.
Shopping, I.H., 2013. Consumer. Retailer, and Manufacturer Incentives to Participate in Electronic Marketplaces.
Solomon, M., Russell-Bennett, R. and Previte, J., 2012. Consumer behaviour. Pearson Higher Education AU.
Turconi, S., Rentocchini, G., Manchala, S., Khimasia, M., Glass, A., De Fanti, J. and Braken, R., 2011. Intellectual property protection: Problems and prospects for China.
Vom Brocke, J. and Rosemann, M., 2010. Handbook on business process management. Heidelberg: Springer.
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