LAWS11066 – CONTRACTS TERM 3 2022

ASSESSMENT2–INDIVIDUAL ASSIGNMENT

Marks: 40% of the overall assessment for the unit

Submission: Online via Moodle

Format: One file in .doc or .docx (MS Word) format.

Submissions in any other format (e.g. .zip) will be treated as a non- submission.

Word limit: 2,400 words

11.45 pm, 9 January 2023 Final submission due:

Late penalties will be strictly applied at the rate of 5% of the total mark (ie 2 marks) per day. Extensions of time can only be sought via the online extension system. Extensions cannot be sought by email.

Referencing: All referencing to comply with Australian Guide to Legal Citation (4th ed).

Part A (20 marks) Facts:

Ross and Jacinta live in a share house together in Rockhampton with a bunch of other friends. Jacinta recently became a seller for a perfume company that operates through a network of independent selling agents who are trained to sell the products (perfumes, facial creams and other make-up products) using a standardized sales technique. The technique involves a script explaining the products and also demonstrations on how to use the products. One day, Ross explained to Jacinta that his girlfriend was frustrated because she had for some time been suffering from a skin condition that made her face all blotchy. Jacinta told him she thought she had a skin cream that could help. Ross said that he would pass it on to his girlfriend. Jacinta said that she wanted to give him her standard sales approach because she needed the practice.

Jacinta got out all he products and went through the standard sales technique, demonstrating how to use the product. She got Ross to try the product on his own face, which led to some laughs. Unfortunately, this distracted Jacinta and she forgot to give Ross the standard warning that the product should not be used on skin with open wounds or recent scarring. Jacinta did tell him that she used the product herself and Ross said he liked it. He joked that it made him look “gorgeous” and Jacinta jokingly agreed. At the end of the

demonstration, Jacinta said that since he was a friend he could have the product straight away and pay for it later. Ross said “OK” and took a tube of the facial cream from her. He said he would pay her when he could afford it, but he was a bit short of funds at the moment. He forgot to ask her how much it was and she didn’t say.

Ross happily wrapped up the facial cream in colored paper and gave it to his girlfriend, Maria, as a present. He was quick to explain that it was really because he was concerned about how she was feeling, and he passed on to her all the good things that Jacinta had said about the product.

Maria used the product on her face over several days, but then found that she was suffering much worse blotches on her face and the red areas were becoming swollen and one area of open skin became infected and she ended up suffering bad scarring which was unlikely to clear up completely.

Questions:

1. Did Ross and Jacinta have the intention to create legal relations? (Answer this in IRAC format limiting yourself to the one issue identified in the question). (12marks)

2. Assuming that there was an intention to create legal relations, identify in the dealings between Ross and Jacinta any communications that fell within the following categories:
   • invitation to treat;
   • offer;
   • counter-offer;
   • acceptance;
   • rejection. (6marks)

3. Assuming there was a contract, what was the consideration moving from each of the parties?

(2 marks)

Part B (20 marks)Questions:

1. Assume that in the facts of Part A, Ross (who is 25 years old) had been drinking and was so drunk that he was singing while Jacinta was setting up her presentation. Ross actually has a condition that causes him to get drunk very easily after only one or two drinks. Jacinta knew from living in the same house that he only sang when he was drunk. Explain what would need to be established in order for Ross to

get out of the contract on the grounds of lack of contractual capacity, and give your opinion on whether such an argument would be likely to succeed here. (You do not need to use a full IRAC format here – you need to explain what factual conclusions are required by the law to show a lack of capacity, and then explain why the actual facts do or do not satisfy the requirements). (8marks)

2. Alternatively, assume that:
   • Jacinta sold the facial cream directly to Maria in a normal business transaction in which Maria agreed to pay for the cream in one month’s time;
   • Maria wanted it for the same reason as in Part A – to address the issues with her skin condition;
   • Jacinta gave the appropriate warnings about its use and Maria did not suffer any adverse effects from using it.

If Maria was only 17 years of age, would the contract be enforceable by Jacinta? Give reasons for your answer. (You can use IRAC here). (12marks)

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