Whether the contract amid Jessica and Angela is based on misrepresentation and thus Angela can terminate the contract?
In every contract it is very necessary that all contract elements must be present, that is, offer, acceptance, legal intention, consideration and capacity. It is also necessary that the basis of the contract is not any kind of deception amid the parties. One of the elements which if present renders the contract ineffective is misrepresentation. (Latimer 2011)
Misrepresentation is an act on the part of any of the party to the contract, under which one party to the contract makes some declaration which are not true and which the basis are of contract formation. in such situation, the aggrieved party can annul the contract and seek damages. So, to prove misrepresentation, the main elements include: (Barker et al, 2015)
When all the elements are fulfilled then the contract is based on misrepresentation and the aggrieved party can cancel the contract and ask for damages from the wrongdoer.
The law is now applied.
It is found that the contract that is made amid Jessica and Angela is based on misrepresentation mainly because:
So, there is clear misrepresentation on the part of Jessica which is made upon Angela and which is the basis of the contract formation.
Conclusion
Thus, misrepresentation is incurred by Jessica by stating false statements of facts and thus inducing Angela. So, Angela has every right to cancel the contract with Jessica and claim and claim damages. She can also continue with the contract and reduce the payment of the restaurant.
Can Sandra and Andy sue Acme for the loss that is caused to them?
Negligence is a tort law which is very essential and develops a relationship amid the defendant and the plaintiff according to which the defendant is supposed to act in such manner so that no injury if any kind must be caused to the plaintiff if the defendant is taking any actions or inactions and is held in Donoghue v Stevenson [1932].
This law of negligence is developed in Donoghue v Stevenson (1932). The majority of the decision submitted that an obligation is imposed on the manufacturers of the product that if any product is produced by them and is supplied to the customer wherein the product is sealed and the manufacture intends that the product must reach the customer in the same manner as produced by the manufacturer with no opportunity of any examination, then, the manufacturer must make all reasonable efforts to avoid any act which might cause harm to the customer. This duty of avoiding injuries upon the consumer is also extended upon the retailers of the product and is held in Grant v Australian Knitting Mills (1935). (Lunne and Oliphant 2013)
Now, if the retailer is not able to make any compensation to the customer if any loss is incurred then the liability is shifted to the manufacturer and he must compensate the consumer for the loss so suffered because of the defective product. In Grant v Australian Knitting Mills (1935) the court submitted that both the manufacturer and the retailer are liable for the loss that is caused to the consumer if negligence is incurred on their part. (Lunne and Oliphant 2013)
Now, it is not easy to prove negligence on the part of the manufacturer. There are number of elements that must be complying with to make any retailer or manufacturer liable under negligence:
The presence of proximity signifies that the defendant and the plaintiff should be in the relationship of closeness. The closeness must be such so that any act/omission that is undertaken by the defendant will hamper the plaintiff. There is closeness amid the parties. Thus, it is not every person who is the neighbor of the defendant but only those plaintiffs who might get affected by the acts of the defendant are considered to be the neighbor of the defendant and is held in Donoghue v Stevenson [1932].
It is also required that the plaintiff must be reasonably foreseeable by the defendant. If the defendant is not aware of the presence of the plaintiff, then there is no duty that must be furnished by the defendants against such plaintiff and is held in Annetts v Australian Stations Pty Ltd. (2002).
When all the elements are comply with then the defendant is held liable for incurring negligence on the plaintiff and must provide the loss that is suffered by the plaintiff because of the negligent actions of the defendant.
The law is no applied.
It is necessary to prove all the elements of negligence against Andy and Sandra in order to hold either the retailer or the manufacturer liable for the loss that is caused to them.
Sandra purchased a carton of cola from the local corner store. The store provided the same. Now, the store must provide the carton to Sandra and must make sure that no loss is caused to her because of the use of cola. There is duty of care upon the store because:
So, there is duty of care that must be provided by Store against Andy and Sandra.
This, duty of care was breached by the store mainly because Andy drink the bottle of cola. It was found that the bottle was containing cockroach remains. Thus, the cola that was provided by the retailer was not as per the quality that must be provided by the retailer/manufacturer. So, the level of care that is expected from the retailer fall short of what is expected from a reasonable prudent man and thus there is totally violation of duty of care.
Now, when Andy drink the cola which was containing the cockroach then because of the consumption he fell ill and he was hospitalized. Thus, the loss that to Andy was direct and thus there is causation. Also, the loss was not too remote. So, the retailer is liable for the hospital expenses that are faced by Andy.
But, there is no loss that is caused to Sandra because of the breach of duty against Sandra. The loss that is caused, that is, she was not able t go for work, is a very remote loss and also there was no causation. So, retailer is not liable to the loss of Sandra.
It is submitted that the retailer is said to be found to be bankrupt and is thus not in the position to pay for the losses that is incurred to Andy. Now, if negligence is proved which is caused o the consumer because of the consumption of the product, then, it is both the manufacturer and the retailer who are liable to provide relief to the consumer. As per Grant v Australian Knitting Mills (1935) since the local corner store is not in the position to pay for the losses that is caused to Andy, so it is acme that must provide compensation for the loss that is caused to Andy.
Thus, Andy can sue for the losses that are suffered to him.
Conclusion
Andy has full right under the law of negligence to sue Acme for medical expenses and the loss that is caused to him because of the negligent actions of Acme.
Reference List
Books/Articles/journals
Barker et al. (2015). Law of Misstatements: 50 Years on from Hedley Byrne v Heller. Bloomsbury Publishing.
Latimer, P. (2011). Australian Business Law 2012. 31st Edition. CCH Australia Limited.
Lunne and Oliphant. (2013). Tort Law: Text and Materials. OUP Oxford.
Plunkett, J. (2018). The Duty of Care in Negligence. Bloomsbury Publishing.
Case laws
Annetts v Australian Stations Pty Ltd. (2002) 191 ALR 449
Donoghue v Stevenson [1932] UKHL 100;
Dulieu v White [1901] 2 KB 669
Esso Petroleum v Mardon [1976] QB 801;
Edgington v Fitzmaurice (1885) 29 Ch D 459;
Farr v Butters [1932] 2 KB 606
Grant v Australian Knitting Mills (1935);
Harriton v Stephens [2006] HCA 15
Horsfall v Thomas [1862] 1 H&C 90
Nottingham Brick & Tile Co v Butler (1889) 16 QBD 778.
Rothwell v Chemical and Insulating Co [2007] UKHL 39
Smith v Hughes (1871) LR 6 QB 597
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