Part A
Question 1(b)
United Kingdom has been taken as the selected foreign country whose legal system would be analysed keeping in mind the three part legal system described by Hart.
A key condition necessary is that the source of law should be clearly identifiable which is apparent in case of UK where there are three major sources that emerge. The most prominent source of law in the UK is statute law which refer to those laws which have been legislated by the Parliament and other authorised bodies. This is without doubt the most significant source especially because the constitution is unwritten for UK> Another key source of law in UK is common law and it acts as a source of legal principles which are highly regarded. Another source of law relates to the European Union Law which assumes relevance in the backdrop of UK being a member of EU[1]
In comparison, the law sources relevant for Australia are as outlined follows[2].
A key aspect worth mentioning is that in case of Australia, a significant role is played by Constitution which does not happen for UK considering the vacuum created by the absence of a constitution and hence emphasis is more on traditions and conventions.
The second component of Hart’s legal system is that there has to be mechanism for bringing about change in law. This would essentially involve formulation of new laws coupled with withdrawing the old laws. The UK parliament is the single most significant entity which tends to function towards this cause. However, it is imperative to note that they do not work in isolation and are constantly influenced by people through various feedback system such as the pension system[3].
In comparison, Australia also shares similar process with regards to making of law considering common roots in the colonial history for both nations. Further, the law making power of the legislature at the Federal and State level is dependent on the bifurcation of subjects between the centre and the state. Also, there is judicial review which ensures that the law changing power is kept under check and the constitutional principles are not breached[4].
When there are legal regulations, then disputes also logically would arise which would require a dedicated adjudication system in place. The key role in this process is played by the judiciary. However. Considering the overlapping powers of the various organs, the judicial powers were in the past also vested in other organs such as Queen’s Bench and Privy Council. However, changes over the last couple of decades have strengthened the judiciary and they serve as the primary instrument of adjudication in UK[5].
In Australia, the constitutional provisions and doctrine of separation of power ensures that the judiciary remains independent. Further, there is a hierarchical structure of courts which tend to exist at the state and the Federal level. Owing to administrative law, there are other mechanisms for adjudication which have become prominent in the last five decades.
Part B
Question 2
Issue
The issue is to comment on whether the contract would be classified as void contract based on the underlying misrepresentation carried out by Angelo with Barry.
Relevant Law
When a buyer wants to purchase something, then the concerned seller would make various representations related to that particular product or service. The set of representations is an imperative factor on the part of buyer to enact a contract with the seller. Hence, when there is any false representation which has been stated on the part of representor, then this false representation will be named as misrepresentation. The misrepresentation can be either done intentionally or by mistake.
When, the representor has intentionally made false representation to the buyer with the aim of forging a contract with the buyer, then it would result fraudulent misrepresentation. When there is fraudulent misrepresentation made by the representor, then the contract would become voidable and innocent party can take the damages from the representor party[6]. The essential conditions that need to be satisfied to determine the given representation as misrepresentation are shown below:
Also, under Competition Consumer Act 2010, the aspects related to the misrepresentation that would be taken into consideration and are shown below. A deceptive advertisement of the seller would be considered if the below outlined factors are satisfied[10].
Application
Barry is working for a company and wants to earn significant gains and therefore, has decided to buy a business that can result in substantial gains. At the same time, Barry has seen the advertisement given by Angelo that states the attractive aspects such as significant gains, less expenses and no competitor of the business. Barry was impressed with the factual representation made by Angelo and hence, decided to enter into contract based on the representation of Angelo.
It is also noteworthy that Angelo does not grant him any annual revenue receipts or financial statements related to the business performance. Therefore, the only resource for Barry to depend is the representation extended by Angelo. Also, Angelo is well aware about the aspect that strong financial position of the business is key in seeking interest from Barry. Also, Barry would not enact contract with Angelo, if he would have any knowledge that the actual financial performance would be different from what Angelo has stated to him.
Further, it is also evident from the case that Barry does not have any clue or suspicion regarding the misrepresentation of Angelo. Therefore, it can be said that Angelo has knowingly represented false factual information to Barry so that he would impress with the facts and would enact a contract of acquiring the business.
It can also be seen that Angelo has mentioned the wrong figures and information related to the van and loader’s worth. Angelo has not specified that van has been taken on lease and hence, every month it is essential to pay the lease amount to lease the van. Also, the loader does not have any value. It would be fair to conclude that deceptive advertisement and false information made by Angelo has extended the rights to Barry to ask for the damages from Angelo in accordance with the ACL.
Conclusion
Angelo has indulged in fraudulent misrepresentation so that Barry would be ready to enter into contract. Hence, due to the presence of misrepresentation, Barry can claim the damage from Angelo because the enacted contract would become void.
Question 3
Issue
After considering the assumption that contract has not been nullified, the issue is to determine whether the contractual terms have been breached or not and based on this if there has been a breach of contract by Angelo.
Relevant Law
The contract would not be breached when there is no violation of the contractual term by either of the contractual parties. The terms can be implicit or express based on the representation. It is noteworthy that both implicit and express terms are having same value in contract. Hence, it is imperative to decide as to which representations would be classified as term of contract while which would be mere representations[11].
There are several essential parameters that would be considered to separate a term from the representation. There should be sufficient skill of the representor party to check whether the stated representation is right or not. The rule of thumb opines that the representor having expertise knowledge to verify the representation stated to the representee would be categorised as term. This is because, there is a significant probability that representee does not have the requisite knowledge to verify the correctness of the representation and hence, he/she has to completely rely on the representation of representor[12].
The importance of the representation for the representee would be an imperative parameter to decide whether it is just representation or contractual term. In order to describe this aspect the decision given in Bannerman v White[13] case would be taken into consideration. In this case, the quality of hobs being sulphur treated was a critical aspect of purchasing the hobs from the seller. Also, if the seller has said that the hobs are not treated with sulphur then the buyer would never have entered into contract with the seller.
Therefore, it can be said that quality of hobs treated with sulphur is non-negotiable parameter for the decision of buyer to enact a contract of buying the hobs and hence, it is a contractual term[14]. Also, if the seller falsifies the statement and does not bother to inform buyer that the hobs are not sulphur treated, then there would be a contractual breach. Hence, the breach of contractual term would provide the rights to the innocent party to recover all the incurred losses from representor who has violated the term. Also, there is the parole evidence rule for which the decision would be made in relation to the separation of representation from terms of contract. According to this principle, all the respective representations which have clearly been mentioned in the written contract would automatically be the terms of contract while the oral ones would be considered insignificant and hence only representations[15].
Application
It can be said from the given case information that the essential aspect for Barry to buy any business is financial performance of business which is also evident from the below listed parameters.
Based on the given information, it is apparent that Angelo has breached the implicit and express terms of the contract. Therefore, Barry can claim damages. from Angelo for breach of the contract.
Conclusion
It can be seen from above that there is a breach of contractual terms (both implicit and express) and therefore, Barry has the legal rights to take the Angelo to the court and can ask for the compensation of the damages suffered.
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