Legal Case Scenario: Electric Blues’ Electronics Hire Business

Question

Does Weitao bind by the small print note about the replacement charge of $1000?

Rule of Law

L’Estrange v F Graucob Ltd is a top contract case law on incorporating the terms in the contract by signing the contract.  There are some exceptions defined by the court to the rule which consists of non-est factum, misrepresentation and fraud[1].  With the exception of these three factors, the signature by an individual binds them with all the terms.  The court has confirmed that with the absence of all three elements, a party could not be excused from executing the terms of a signed agreement which content has not been read by them[2].

Application

An electronics hire business, Electric Blues is owned and ran by Evelyn. When a projector was hired by Weitao from Electric Blues, he was told to sign a paper which includes the details about the projector and the time period of his borrowing the projector. At the end of the page there was small print note where it was written that if any damage is done to the hired object, the customer is bound to make payment for replacement charge of $1000.

The details at the top of the page were checked by Weitao, but he was not concerned to read the small print note at the end of the page. The document was signed, and the projector was taken home by him. While utilizing the projector, the casing of the projector was accidentally scratched by Weitao[3]. At the time of returning the projector to the store the next week, he has offered to pay for the scratched casing so that it could be fixed. It was insisted by Evelyn that Weitao owed her $1000 as the replacement charge to replace the whole projector.

Conclusion

No Weitao is not bound by the small print note which was written about the $1000 as the replacement charge. Though Warren has failed to notice the small print note, but according to the rule of L’Estrange v F Graucob Ltd, the short words are the content of the agreement. The content of the contract has to be clear and not vague. The replacement charge note was written in small print and also includes the false statements of Evelyn.  

Legal Issue

Is Warren correct? Is there contact between Evelyn and Warren?

Rule of Law

The business contracts are generally very long. It is usually tried by the drafter of the contract to cover every terms and provision of the deal. The implied terms are those terms or regulations which is assumed that they are meant to be included in the agreement[4]. This signifies that the implied terms are not expressed and specified in the agreement. The contract drafter usually avoids the implied terms. It is not possible to cover the whole contract in details. In that case, it is assumed that some terms are common knowledge and both the parties knew the meaning of those terms without the description of that terms[5].

Is Weitao bound by the note in small print about the $1000 replacement fee?

Application

Evelyn wanted to improve the layout and décor of her store of electronics hiring business. For that, she has appointed Warren so that Warren would paint the walls of the inner sides of the stores. The task was accepted by Warren, but he said that it would take one whole day to finish the painting of the walls and another entire day to dry the walls. Evelyn agreed at the conditions of Warren. For the next five weeks, every time Warren has called Evelyn for suggesting a date for painting the walls. Every time Evelyn has said that she could not close her store that week.

She gave the reason that she has some important deliveries to arrive or due to delays of the clients. Moreover, she has refused to provide any upcoming date for Warren so that he could finish painting the walls of the store. Warren became upset at this and complained that Evelyn is not making possible for him to receive the advantage of their contract and this is something have to do by every contractual party.      

Conclusion

Yes, Warren is correct that Evelyn is not giving him the advantages of their contract. But it has not been specified in the contract that Evelyn will tell Warren to paint the walls at a particular date. So it is the implied term of the deal. Evelyn can call Warren anything for painting the walls of her store, as the time has not been specified in the contract[6].    But in this case, a question also arise if there is a contract between them in reality. The conditions between Evelyn and Warren was carried on verbally, and there is no evidence of the contract between them.

Legal Issue

Is it a term in hire contact of Ambreena that the tablet has more storage space than other tablets on the market?

Rule of Law

Puffery regularly takes place in advertisement and promotions. Puffery might be utilized as a shield to the guarantee or in the fraud claim. As per federal law, if an individual or an organization is involved in the false advertisement of a product or service, and someone has a financial loss by depending on the information given in the advertisement, then the individual or the organization has done a criminal offense[7].  The product or service review could also be taken as puffery on the basis of assumptions, real or unreal, on the part of the reviewer.

People generally assume that if some person is writing in favor of the product or service, they might be paid for saying in support of the company. Puffery also refers to false or overvalued praise[8]. In law, puffery is a statement or claim used in promotion which states subjective views instead of objective opinions which practical peoples will not literally accept.

Application

Ambreena has come in the store and spoke to Evelyn that she need a tablet so that she could finish her vital project while traveling in a foreign country. Evelyn showed her a tablet and told that the tablet is good and light and suitable for travel. She also said that it has high space for storage in comparison to other tablets. Ambreena hired the tablet to take with her in the foreign country. But when she tried to install the apps required for her project, she found that the tablet has very low space for storage. 

Is Warren correct?

Conclusion

The hire agreement of Ambreena is bound to have the term that the tablet would have maximum storage space than other tablets on the marketplace. Ambreena was told by Evelyn that the tablet has maximum storage than other tablets, and Ambreena has believed her and hired the tablet for her project. But it was found by her that it has minimal storage space. So the law of puffery applies in this case as it is the case of false promotion of the tablet by Evelyn[9]. Ambreena had rented the tablet on the false assurance from Evelyn which she later realized when she tried to install the apps on the tablet.    

Legal Issue

Does Jake’s hire contact has an implied term that a charger cable would be given with the hired laptop?

Rule of Law

In law ad hoc signifies doing something for a particular reason. So if a case is based on ad hoc, that means it is utilized to address that particular cause or need. It is for something which was not planned in a pre-existing situation. In law with ad hoc method, the parties might agree with their own rules and practices for that particular cause. Ad hoc are implied terms of the contracts as the need of the situation and according to far-reaching implications and principles[10].

These far-reaching implications and policies are developed and refined by the courts, which looks to combine maximum equality between the parties with a minimum distortion of the real fact and express the terms made by the parties. The implications of ad hoe are known not through their content but by the case which is demanded and the cause served by them. The contractual law had several consequences of ad hoc.

Application

Yes, it is an implied term in the hire contract of Jake that a charger cable would be given with the hired laptop. Jake came to hire a laptop from the store of Evelyn. After selecting the laptop, he filled up the documents and completed the paperwork. After he took the laptop to his home, he has realized that the laptop bag has no charger cable. He immediately called in the store and spoke with Evelyn. To his surprise, Evelyn told him that Jake has never asked for the charger and if he also hires the charger, he has to give an extra price for the charger[11]. Jake told Evelyn that he never thought that he has to ask for the charger, as he has expected that the charger is usually included with the laptop. 

Conclusion

Jake has hired laptop from Evelyn and later found out that the Evelyn has given the charger with the laptop. After asking for the reason, she has said that Jake has never asked for the charger and if he hires the charger, he has to give an extra charge for it. It is evident that the charger comes along with the laptop, and a customer does not have to ask separately for it[12]. Here the implied term of ad hoc is applied as Evelyn has taken advantage of the situation for her particular purpose.

References

[1]Anne Barraquier, Bender Mark, Klaw Bruce, Mayer Donald and Holcomb John. “Innovations in Teaching Business Ethics and Business & Society.” In Proceedings of the International Association for Business and Society, vol. 28, pp. 105-117. 2017.

[2] Ben Tran. “Bridging the foundational gap between theory and practice: The paradigm on the evolution of business ethics to business law.” In Business Law and Ethics: Concepts, Methodologies, Tools, and Applications, pp. 1180-1208. IGI Global, 2015

[3] Hugh Beale. “Book Review: Rules and Principles in European Contract Law, edited by Jacobien Rutgers and Pietro Sirena. (Antwerp: Intersentia, 2015).” Common Market Law Review54, no. 3 (2017): 951-953.

[4] Ritam Chaurey. “Labor regulations and contract labor use: Evidence from Indian firms.” Journal of Development Economics 114 (2015): 224-232.

[5] Dale B Thompson. “Teaching the Business Law and Ethics of Arbitration after Concepcion.” Journal of Legal Studies Education 34, no. 1 (2017): 63-88.

[6] Nathan Cortez. “The Evolving Law and Ethics of Digital Health.” In Digital Health, pp. 249-269. Springer, Cham, 2018.

[7] John W Dunfee, and L. Fort Timothy. “Legal Issues for Business and Business Ethics.” Wiley Encyclopedia of Management (2015): 1-2

[8] Diane L Swanson, and C. Frederick William. “Denial and leadership in business ethics education.” Business ethics: New challenges for business schools and corporate leaders (2016): 222-240

[9] Nantanat Jintapitak and Liu Jianxu. “Harmonization of contract laws in ASEAN: Contract entropy.” Advanced Science Letters 23, no. 1 (2017): 440-443.

[10] Mary Keyes. “The Internationalization of Contract Law.” In Codifying Contract Law, pp. 15-36. Routledge, 2016.

[11] Knut Benjamin Pißler. “Studies in the Contract Laws of Asia. Volume I: Remedies for Breach of Contract. Ed. by Mindy Chen-Wishart, Alexander Loke and Burton Ong.” Rabels Zeitschrift für ausländisches und internationales Privatrecht82, no. 2 (2018): 544-547.

[12] Samuel Mansell, Ferguson John, Gindis David, and Pasternak Avia. “Rethinking Corporate Agency in Business, Philosophy, and Law.” (2018): 1-7.