BUS107 Commercial Law

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BUS107 Commercial Law

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BUS107 Commercial Law

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Course Code: BUS107
University: Kaplan Business School

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Country: Australia


Alan is a student of Kaplan higher education. He just took unit “commercial law” in June 2015 and received a “credit” grade for the unit,
Whilst tidying up his book shelves, he decided to sell his textbook “introduction to business law in Singapore”, which was a compulsory textbook used in “commercial law” .as he knew of various friends in Kaplan higher education, he posted on his face book page on 1 Nov 2015, as follows:-
“To all my friends who are students enrolling or are enrolled in Kaplan higher education. I am selling textbook “introduction to business law in Singapore”, together with all the notes i took in class. The notes are written in an exercise book and very useful as I obtained a high distinction for this unit! The selling price is $200.00. If keen, please pay me by 5 Nov 2015.”
Bernard is a friend on Alan’s facebook account. He will be taking the “commercial law” unit on 23 Nov 2015 and is very keen to purchase the material from Alan. He immediately posted on Alan’s fecebook wall on 2 Nov 2015:-
“I am keen to buy. But can you sell at $150.00?”
Charleen is Alan’s younger sister who is taking her GCE”O” levels this year. She saw Alan’s post and was very keen to read up on business law. In the morning of 2 Nov 2015, while Alan was still in the bed, she told him that she will buy Alan’s textbook for $200.00.Alan merely smiled. He thought that his sister must be mad to read up on commercial law at her age. When charleen asked if she could pass the money to him on 6 Nov 2015, Alan was thinking about his favourite football team’s performance at last weekend’s match and nodded. He then went back to sleep.
Damien is Bernard’s friend and is a student at Kaplan higher education. he is not on Alan’s facebook account but know who Alan is. He heard about Alan’s offer from Bernard and is keen to buy the materials as he wants to do well for the unit. After obtaining Alan’s handphone number from Bernard, he sent Alan an sms:-
“Alan, this is Damien. I am keen to buy your commercial law material. Can i pass the money to you just in Kaplan higher education on 4 Nov 2015?”
On 3 Nov 2015, Alan replied to Bernard’s post on his facebook wall:-“Sorry. I am selling at $200.00. in fact, there is an offer already.”
On the night of 3 Nov 2015, after much consideration, Bernard decided to buy Alan’s material. However, he would be going overseas for 3 days and could not meet up with Ala. as such, he put $200.00.cash in an envelope and posted to Alan in the morning of 4 Nov 2015. He then informed Alan to look out for the cash. Alan received the cash at 5:pm on 5 Nov 2015 when he open the letterbox.”
In the evening of 4 Nov 2015, Damien saw Alan in Kaplan higher education. He ran up to him and passed him $200.00.cash and said that it is payment for his Commercial Law material. Alan kept the money and informed that he will pass everything to him on 7 Nov 2015.
On 6 Nov 2015, after receiving her pocket money, charleen left $200.00 on Alan’s table.
On 7 Nov 2015, Alan passed to Bernard his original textbook only. He commented that his notes are written in the textbook. On the day, he bought the same textbook from a bookshop and passed the textbook, together with his hand written notes, to Damien.
On 23 Nov 2015,both Bernard and Damien realized that the textbook “introduction to business llaw in Singapore” was issued free-of-charge by Kaplan higher education. They are infuriated.
Discuss, incorporating your understanding of contract law, the following:-
1 whether a contract was formed. If so, when was it formed and who were the contracting parties?2 Bernard’s legal position and remedies3 Charleen’s legal position and remedies4 Damien’s legal position and remedies5 the various alternative dispute resolution options available and the pros/ cons with these options. 


The Issues raised

Whether any contractual relationship is established amid the parties. Who are the parties who have formulated the contract?
Whether there is a contract that is made amid Bernard and Alan?
Whether there is a contract that is made amid Charleen and Alan?
Whether there is a contract that is made amid Damien and Alan?
The various alternative dispute resolution options available and the pros/ cons with these options

Applicable Law
The offeror and the offeree are the guiding parties who together by making an offer and acceptance might result in the contract formation, if there is legal intention and consideration to support the promises. (Tan, 1999)
An offer is made by an offeror to an offeree specifying the terms that he inteds to be comply with by the offeree absolutly. The offeror can either verbally or textually or by actions can communicate the offer to make it valid and is held in (RBC Properties Pte Ltd v Defu Furniture Pte Ltd , 2015).
The confirmation of the offer by an offeree is an acceptance and is held in (Empirnall Holdings Pty Ltd v Machon Paull Partners Pty Ltd, 1988). An acceptance is valid provided it is communicated and is in the notion of the offeror and is held in (Woo Kah Wai v Chew Ai Hua Sandra, 2014). If the acceptance is intended by the offeree but the same is not communicated to the offeror by any means (written, spoken or conduct), then, such intention has no relevance in law and is not an acceptance and is held in (RI International Pte Ltd v Lonstroff AG, 2014). An acceptable by post is an instant acceptance and is complete even when the offeror is not aware of the same and is held in the leading case of (Adams v Lindsell , 1818). (Latimer, 2012)
Instead of making offers, when offers are received by display of goods, or auctions or with the help of advertisement or tenders, etc, then, it is an invitaion to treat and is held in (Pharmaceutical Society v Boots Chemists , (1953)). There is no offer made and the inviter expects the receipt of the offer. If the inviter upon receiving offer confirms the offer, then, it is acceptance resulting in contract and is held in (Midlink Development Pte Ltd v The. Stansfield Group Pte Ltd, 2004). (SMU, 2014)
The offer and acceptance shoukd be combined with some benefit called conisderation which makes the contract neforcebale and is held in (Chwee Kin Keong v Digilandmall.com Pte Ltd , 2005)
The promises which are made by the offeror and the offeree must be made with legal intention. In hosuehold contract the intention is missing  and is held in (Balfour v Balfour , 1919) but in commercial the same is present and is held in (Esso Petroleum v Commissioners of Customs & Excise, 1976) The presumption is rebuttable. (SMU, 2014)
Application of Law
The facts of the factual scenario submit that Alan was studying in Kaplan Higher Education and was the student of commercial law. He was having a test book of the said course along with the notes. In order to sell the book, a post is made on his face boo page addressing to his friends who are part of the University to avail the book and the notes for $200. The post was made on 1st November and the interested party must confirm their intentions by 5th November. Now, the post on facebook page is a kind of advertisement and thus as per (Partridge v Crittenden , 1968) an invitation is made to specific people, friends of facebook. If any person is interested in the invitation can make an offer to Alan
Issue i
Damien on the evening of 4th November meet Alan at the university and handed over $200 for the book. Thus as per (Carlill v Carbolic Smoke Ball Company, 1892) an offer is made. This offer is accepted by Alan when he received the money from Damien and the acceptance is valid. So, there is offer and acceptance with legal intention and consideration of $200. Hence there is valid contract amid the parties.
Issue ii
In order to understand whether there is a contract between Bernard and Alan, it is important to understand the communications that took place amid them.
Bernard is the friend of Alan and was also part of his facebook friend list. Bernard also enrolled in the University. Thus, the invitation that is made by Alan fits in with Bernard and thus makes his eligible to make an offer against the invitation that is made by Alan. On 2nd November 2015, by relying on the invitation that is made by Alan, he communicated with Alan and expressed his interest of buying the book. But, he quoted the price of buying the book at $150 (Alan has given the price quote on his facebook page @ $200 for the book). But, what Bernard has done is the request to Alan. There is only an expression of showing interest and there was no formal offer that was made by Bernard to Alan, the acceptance of which will result in contract amid the two. Thus, as per (Stevenson, Jaques, & Co v McLean, 1880), Bernard has not communicated any kind of offer to Alan.
Alan upon getting aware of the request of Bernard, on 3rd November communicated to him that the only price on which he is interested in selling the book is $200. So, the reply of Alan is also no wheree any kind of offer, but is only the statement that is made to the quest of Bernard. Thus, till now, it is only the invitaion of Alan that exist amid the parties. Further, on 3rd November, Beranard posted his acceptance the acceptance is valid as soon as the letter is posted. He also enclosed a money $200. But, the acceptance by Bernard is of no value as he gave acceptahnce to an invitaion of Alan. There is no offer againt which an accepatnce is given.
So, the acceptance of Bernard has no value and thus there is no contract amid the two.
Issue iii
In order to understand whether there is a contract between Charleen and Alan, it is important to understand the communications that took place amid them.
Charleen is sister of Alan. She is facebook fried of Alan and is enrolled in the University. Thus, the invitation by Alan is applicable to Charleen. On 2nd November Charleen stated to Alan that she is offering to buy the book for $200 but there is no acceptance that was given by Alan, rather, he just smiled. Charleen spoke further and showed her intention of giving money by 6th. However, Alan was no where interested in the talks of Charleen and simply nodded but, this nodding of head is no acceptance and the acceptance by the offeree should be communicated and as per (Balfour v Balfour , 1919)there should be intention of accepting the offer when the same is made. But, this intention of acceptance is missing from the side of Alan. Both Charleen and Alan are sister- brother and there is a conjecture that there is no legal intonation that is present amid them to hold the offer and acceptance legally binding in law. So, there is no contract that takes place between the two because of lack of acceptance and legal intention on the part of Alan.
Issue iv
In order to understand whether there is a contract between Damien and Alan, it is important to understand the communications that took place amid them.
Alan has given invitation to his friends on facebook who are enrolled in the University. Now, Bernard who is friend of Alan on facebook is also the friend of Damien. Bernard told Damien of the invitation of Alan. But, Damien is not able to make offer to Alan as the invitation is not meant for him.
But, Damien text Alan of his intention to buy the book with reference that he can send the money. On November 4th evening Damien met Alan and handed him $200 for the book. This is an offer which is made but Damien which has no relation to the invitation made by Alan. Alan by accepting the money gave has consent by conduct. Thus, an offer by Damien is accepted by Alan resulting in contract.
Issue v
The various alternative dispute resolution options available and the pros/ cons with these options
In everyday life, there are various contracts that are established by the parties. When the parties to the contract comply with their obligations in the contract, then, the contract cease to exist on the basis of performance of the contract. However, when the parties are not willing to fulfill their obligations in the contract, then, the contract cease to exist on the basis of breach of contract. one of the remedies that is normally availed by the non defaulting party is to sue the defaulting party in the court of law. a litigation proceeding is filed and both the disputes parties decide the dispute in the court and the judgment is binding on the parties.
But, it has been found that the process of litigation though has various advantages, but, it also suffers from range of disadvantages. It is found that the process of litigation is a very lengthy procedure method making it very time consuming and complicated in nature. The pre trial stages in itself take much long time and thus the whole process of deciding the dispute amid the parties becomes excessive time consuming. The cost of litigation is very high and it requires payment of fees to the attorneys, court fees, etc. the parties to the dispute are deciding their problems in court which is an open yard and is accessible by various people. There are several evidences and facts which are exchanged amid the parties which are of secretive nature. Thus, deciding the dispute through litigation results in breaching the confidentiality of the parties. (d’Ambrumenil, 1997)
Considering the various problems that are attributed to the process of litigation, there is another mechanism that is availed by the parties. A non formal court hearing process which requires the presence of a third party of independent nature which has given the power to resolve the civil disputes amid the parties and is popularly known as Alternate Dispute Resolution Technique. The Alternate Dispute Resolution Technique  compruses of several methiods which can be selcted by the parties to the dispute to reach at a just concudion. The techniques includes, conciliation, mediation and arbitration.
In the process of concilitaion, a concilitor is applointed who has been assigned the power to resolve the dispute that exist amid the parties. the only problem that exist with the process of concilitaion is that the decision which is lay down by the conciliator is a non binding decision making the process as non effective in nature. the role of the concilitor in reaching  at the conclusion is more interveneing in nature comprared to the role of a mediator. The conclito provides soilution to the problem The parties can reject the decision of the conciliator and take their own recourse.
A step ahead there is  another Alternate Dispute Resolution Technique known as mediation. In the presence of a meditaor, which si an indepenent third party appinted by the disputes parties, when the parties reach at the baragain, then, it is an act of mediation. The main aim of mediator is not t impose any kind of decision on the partie but to stimulate the discussion amid the parties so that the parties themselces reach at a just conclusion which is acceptable by both the parties. the process of mediation is not much time consuming and less exensive. There are less cahnces of seekinga ppeal as the parties have themsekves rtecahed at just concludion. But, the major drawbac is that the decision that is reached is not bining in natuiree. Thus, if any party at later stage decides to make an appeal then he can do so resuting in extending the process of dispute resoilution. The main aim of the meditaion process is to try to maintain the relationhsip amid the parties.
Yet another Alternate Dispute Resolution Technique is the process of arbitration which is an adverial process and the decision that is laid down by the arbitrator is binidng in nature. the main difference that exist amid the process of arbitration and litigation is that the settlement of the dispute takes place privatly unlike litigation which takes place at a pubkic forum. The arbitrator is appiinted by the parties who by using the adversial process resolves the dispute which is bindin on the parties. thus, no appelamcan be made making it as a time consuming dispute resilution mechanism.
After considering all the Alternate Dispute Resolution Technique, it is suggested that the best technique is the process of arbitration not only becauise the decsion is bidning but beacause the dispute is resoled in closed doors and thus preserving the confidentialty of the parties.
There are several negotiations that are taken by Alan. But it is the exchange of offer and acceptance with Damien that has resulted in the formation of contract. Also, arbitration as a Alternate Dispute Resolution Technique is the better technique when comapred woith conclitaion and medaiation as the decision is binding and retains confidentiality of the parties.
Adams v Lindsell (1818).
Balfour v Balfour (1919).
Carlill v Carbolic Smoke Ball Company (1892).
Chwee Kin Keong v Digilandmall.com Pte Ltd (2005).
d’Ambrumenil, P. (1997). Mediation & Arbitration for Lawyers. Cavendish Publishing.
Empirnall Holdings Pty Ltd v Machon Paull Partners Pty Ltd (1988).
Esso Petroleum v Commissioners of Customs & Excise (1976).
Latimer, P. (2012). Australian Business Law 2012. CCH Australia Limited.
Midlink Development Pte Ltd v The. Stansfield Group Pte Ltd (2004).
Partridge v Crittenden (1968).
Pharmaceutical Society v Boots Chemists ((1953)).
RBC Properties Pte Ltd v Defu Furniture Pte Ltd (2015).
RI International Pte Ltd v Lonstroff AG (2014).
SMU. (2014). The Contract Law. Retrieved October 5, 2018, from https://ink.library.smu.edu.sg/cgi/viewcontent.cgi?article=3631&context=sol_research
Stevenson, Jaques, & Co v McLean (1880).
Tan, K. (1999). The Singapore Legal System. Australia: NUS Pres.
Woo Kah Wai v Chew Ai Hua Sandra (2014).

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