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Business Law for Due to Misrepresentation

Question:

Describe about the Business Law for Due to Misrepresentation.

Answer:

1. Issue:

What key areas of Business Law would affect Bill and Jill in the given scenario?

Rule of Law

One of the most essential aspects of a formation of valid contract is that it should not be entered through misrepresentation by the parties. This would leave the contract to be voidable on the part of the party who has been induced to enter into a contract due to this misrepresentation.

For obtaining relief for a misrepresentation, it is necessary that such representation must be of statement which is a past or an existing fact. Such a statement can either be oral, implied or written. No relief generally is made for any other type of statements such as mere statement of opinion, puffs, statements made with respect to intentions that are future or statements that are related to law. However there are sometimes where the court finds such statement of fact implied statement within such representations that are made. When it is statement of opinion the possibility that such statement of opinion would also imply that it is statement of fact was demonstrated in the case of Smith v Land & House Property Corp (Smith v Land & House Property Corp, [1884]) wherein it was held in the case a statement of opinion can amount to often involve as being a statement of fact. Further in the case of Fitzpatrick v Michel (Fitzpatrick v Michel, [1928]) where there was a contract Plaintiff entered into for leasing the flats off to the Defendant. There was a representation that the Defendant had made with respect to the flats that it would be able to bring per week about 6 guineas if the same was sub-let, but this statement turned out to be a false statement. An action was brought in for misrepresentation. Whether any statement that is made about something that will happen in the future can in the same sense as a statement of fact would be. There may be a binding by a man however by warranty that the same will happen in the future, but other than warranty this statement cannot be considered to be more that an expression of belief or opinion. It however does involve a representation certainly that the person who has made the statement entertains the said opinion and possibly representation that he knows the facts are a justification of such an opinion that is made. If however a statement has been made under honesty it would not be a fraudulent representation it would however be a fraudulent misrepresentation if the same would be made if it would be made of a false representation.

A term is a statement which is important to at least one of the parties Oscar Chess Case (Oscar Chess Ltd v Williams, [1957]). The statement was made for closing the agreement finally. It is a statement that causes the party to enter into the contract. It is a statement which induced the party to enter into the contract. The statement made was one that was relied by one of the parties on the knowledge or special skill of another party Dick Bentley Case (Dick Bentley Productions Ltd v Harold Smith (Motors) Ltd, [1965]). If a term induces a party to enter into a contract then even if there is a slight non-performance of this condition then it can result in the contract being terminated Luna Park Case (Luna Park (NSW) Limited v Tramways Advertising Pty Ltd, [1938]).

There is duplication of section 18 of the section 52, where there is prohibition where there is prohibition in the conduct of commerce or trade that is deceptive or misleading, or likely to be deceptive or misleading. In the same manner as section 52 section 18 states that the most essential and used widely provision of the Australian Consumer Law provision which is easy to be proven and there is a wide range of conduct that is included in it.

Application of Law

There has been a misrepresentation on the part of Dodgy Pty. Ltd. to induce Bill and Jill to enter into the contract.  There is a warranty that is established with the statement made by Dodgy Pty. Ltd. incorporated in the contract. Further there is also a prohibition under Australian Consumer Law with respect to misrepresentation.

Conclusion

There has been misrepresentation of the part of Dodgy Pty. Ltd. and the contract may be rescinded.

2. Issue

What are the key areas of business law that are affected?
What are the remedies that are available?

Rule of Law

Section 17 of the Trade Mark Act 1995 states that trade mark (Anderson and Gallini, 1998) is the sign that is intended or used to distinguish services or goods in the trade course. Intellectual property right is protected by the company by registering the trade mark which is not compulsory or registering the business name of the company which is compulsory significant Australia wide protection is provided on registration of the company for the name of the company. An action for infringement of trademark invariably and often copyright infringement are coupled along with deceptive and misleading conduct allegation, putting thereby into play the broad remedies that have been made available under  Trade Practice Act (now the Competition and Consumer Act 2010). In Australia infringement is defined as using of a sign as a trademark which is identical substantially or there is deceptive similarity to a trade mark that is registered with respect to the services or goods which the registration of the trademark is done (i.e. goods that are identical).

It has been contained in the Schedule 2 of the Competition and Consumer Act 2010 (Cth.) the Australian Consumer Law is contained. It has been provided specifically by section 20 of the Australian Consumer Law that a person who is trade or commerce should not engage in conduct which in unconscionable.

A very important compliance is the compliance of the Australian Consumer Law and Sale of Good Acts and ensuring that there is no misleading conduct or representation. One of the landmark cases of misleading conduct has been the case of Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Ltd [2015] FCA 330 in which post ACCC's action it was found by the Federal Court that the consumers had been misled by Coles due to their representation that the in-house bakeries of Cole were baking the bread that was being sold by them (Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Ltd, [2015]). On the packaging of the bread, it stated that the bread was ‘Baked Today, Sold Today' and in some places it was mentioned as ‘Freshly Baked In-Store.' These products, in fact, were par-baked i.e. they had already been baked partially and then frozen off-site by a supplier and in some of the cases, this supplier was from overseas. These were then transported and finished in the bakeries that were in the house. It was opined by the court there was deceptive or misleading conduct that the Coles had engaged in, and the representations that had been made by them was false or misleading to promote the bread that they were selling. The declarations that the court made was injunctions were ordered, and the advertisement was asked to be corrected, and also $2.5 million was attracted.

Further in the case of Hadley v. Baxendale it was opined that there damages which are available for losses that can be foreseeable reasonably or have been communicated to the defendant specifically (Hadley v. Baxendale, [1854]).

It was in the case of Donoghue v. Stevenson that the principle of product liability had been established wherein it has been stated that even in cases where no contract or proximity exists between a party there would still exist a duty to care. It establishes the principle that any kind of act or omission which could be reasonably foreseen to cause damage to a neighbor. Neighbors, under law, are those who are directly and closely affected by a certain act (Donoghue v Stevenson, [1932]).

A landmark case which is related closely to the case of Donoghue v. Stevenson was the case of Grant v. Australian Knitting Mills Ltd. in this case there was an undergarment which had been brought by the plaintiff, Dr. Grant from a certain retailer (Grant v. Australian Knitting Mills Ltd, [1936]). The manufacturer of this undergarment was the defendant Australian Knitting Mills Ltd. Due to this undergarment Dr. Grant suffered from Dermatitis. It was in a defective condition that the undergarment was in which was due to the fact that there was excess sulphite which was present in the undergarment. The manufacturer was found to have left it negligently during the manufacturing process, in the said case the retailer was sued by the purchaser in contract and he sued in tort the manufacturer. It was held by the Privy Council that there was liability on the defendant towards the plaintiff although there was no privity that existed between the manufacturer and Dr. Grant. It was to the case of Donoghue v. Stevenson  that this case was bound to due to the similarity in the cases.

Further, in Australia there have been changes made by the Parliament to the negligence law with the Civil Liability Act. There is a three-step test which has replaced the reasonable person test when a risk of personal injury is there. Though, the words reasonable and foreseeability are still used by the Act as had been used by Lord Atkins. Section 5B(1) states that a person would not be considered to be negligent of take against a risk of harm precautions unless: (a) it was a foreseeable risk (that is a risk which the person either knew of or ought to have known of), and (b) it was an insignificant risk, and (c) a reasonable person in the given circumstance would have taken such a precaution. (2) The determination of whether a person who is reasonable would have taken the necessary precaution against harm’s risk, the following would be considered by the court (amongst other things that are important): (a) the probability of there being occurrence of harm if care had not been taken (Bolton v. Stone, [1951]), (b) the seriousness that is likely of the harm (Rogers v Whitaker, [1992]), (c) the precautions burden that would have been taken for the avoidance of harm (RTA of NSW v Dederer, [2007]), (d) the activity’s social utility that created the risk of the harm.

There can be a legal action brought against the company by the Plaintiffs being the UberDelivery as well as the consumers of the harmful ingredients under both civil and criminal cases.

Application of Law

There has been infringement of trademark and also there has been breach of duty to take care as well as breach of Australian Consumer Law.

Conclusion

Conclusively it can be stated that an action can be brought against the company by UberDelivery and the consumers and the relatives of the consumer who died.

References

Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Ltd [2015]FCA 330.

Bolton v. Stone [1951]AC 850.

Dick Bentley Productions Ltd v Harold Smith (Motors) Ltd [1965]EWCA Civ 2.

Donoghue v Stevenson [1932]UKHL 100.

Fitzpatrick v Michel [1928]28 S.R. (NSW) 285.

Grant v. Australian Knitting Mills Ltd [1936]A.C. 562.

Hadley v. Baxendale [1854]EWHC J70.

Luna Park (NSW) Limited v Tramways Advertising Pty Ltd [1938]HCA 66.

Oscar Chess Ltd v Williams [1957]EWCA Civ 5.

Rogers v Whitaker [1992]HCA 58.

RTA of NSW v Dederer [2007]324 CLR 330.

Smith v Land & House Property Corp [1884]LR 28 Ch D 7.

 

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