The Commercial Law and Policy
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Requirements:
This is an individual assignment. Double space; footnotes and bibliography are required. Reference style: the AGLC is used.
This written assignment is aiming at solving complex legal problems covering ULOs 3, 4, 5 and 6. It is also related to solving complex legal problems covering GLOs 1, 2, 4, 5 & 6.
Weight: 30%. Maximum words limit: 3000 words. 10% leeway. Around 2,500 words will be very adequate for a 30% assignment.
Due date and time: Please check the assignment drop off box for details
Assignment Question:
Matthew Lin and his 9 year-old son George love equestrian and they were members of an equestrian club in Beijing. They just obtained their Australian permanent residency status in March 2016 and settled in the suburb Lilydale with a big block of land. They find the costs of equestrian training and membership fees are very cheap in Melbourne, comparing with the equestrian fees in China. They immediately join an equestrian club in Lilydale and spend all their weekends at the club. Both Matthew and George don’t have much English. Whenever they need to communicate with the people at the equestrian club, Matthew uses Google Translate in his phone to get messages to other people. Soon, Matthew believes he can make a living by exporting quality Australian horses to those hundreds of newly opened equestrian clubs in China who pay very high prices for overseas horses.
Matthew knows a real estate agent Don Carmichael who works at LJ Hooker’s Lilydale office. Matthew bought his house from Don. Don also helped him to buy a car, registered a local company and enrol George at the local school. When Don finds out that Matthew wants to buy horses for the Chinese equestrian clubs, he says to Matthew that he has many friends and relatives living in the Mount Macedon districts. They have been breeding and selling horses to Australian and overseas buyers for generations. Matthew is very happy to know Don’s connections with horse breeders. He asks Don to buy 10 horses to start with and he promises to pay Don a very attractive commission afterwards. He describes to Don that he wants 7 of the 10 Australian Warmblood horses to be under 1 year old for no more than $10,000 each, so they can be trained for the inter-club competitions in China. He will export these 7 horses directly onto China once he buys them. He also wants 2 ponies to be kept in his big backyard so George can ride and play with them at home after school. The last one shall be a 10-year old gentle Australian Warmblood horse for George to ride at the Lilydale equestrian club. Matthew gave those instructions orally, but showed Don some pictures of the kinds of horses he and his friends in China would like to buy. He also emphasized that he can buy more Australian Warmblood horse if Don’s relatives have more as the demand of equestrian horses is very high in China. Don assures Matthew “No problems”.
Don doesn’t know much about horses himself. He calls his cousin Jack in Mount Macedon and tells him a Chinese buyer wanting 10 horses for leisure and more order to follow. He didn’t mention anything about the Australian Warmblood horse, the age and purpose of the horses to his cousin. Jack says that among the relatives in the region, they have over 150 horses they can choose from. Jack sells horses regularly to Hong Kong buyers and he uses a standard contract for all international buyers. In the standard contract, there is a disclaimer excluding sellers’ liability for disease, illness, potential or quality of horses once they are delivered and checked by the buyers.
Jack drives specially to Melbourne for Matthew’s signatures and deposit for the sale of 10 horses. Jack’s Standard Contract is signed over a friendly lunch while both Matthew and Don are at present. Matthew signs the Contract and draws a cheque of $10,000 as the deposit in the name of his newly registered company. Before Matthew signs the contract, he uses Google Transfer to check several clauses and he was happy with them. Matthew didn’t check the fine-print of the disclaimer. While Jack shaking hands with Matthew and saying “happy cooperation” at the end of the business lunch, Matthew tries to ask Jack whether those horses are ‘jumping horses’ and ‘light horses’ in broken English. At that point, Jack realises that Matthew may have some special requirements about the horses. Nevertheless, Jack says nothing and drives back to Mount Macedon. Jack’s Hong Kong buyers are generally more than happy with Jack’s horses. He is very confident that Matthew will be very happy once he sees the horses.
When the 10 horses are delivered to Matthew, he loves them straight-away although he finds the horses are a bit too big for 1 year old. They are good looking horses but they do not look like the Australian Warmblood horses. The two ponies are cute and have no problems, but the horse for George seems young and wild, but George likes it. At the delivery of the horses, Jack knows Matthew and Don have no much knowledge about horses apart from the looks. Matthew knows the Chinese buyers will be happy with those horses, so he gives Jack a cheque of $90,000 as the balance.
While Matthew goes through the complicated quarantine process of flying the horses to China, he is told that those horses are more suitable for races than equestrian. He also discovers that the 7 horses for the Chinese equestrian clubs are at least 4 to 5 years old and they are definitely not the Australian Warmblood horses. Those horses shall be no more than $5000 each. Worse of all, George’s horse in fact is an Australian Brumby. George rode on it at the club training session one day and fell off badly and injures his neck and leg.
Matthew is very angry about the whole thing now. He wants to return the horses back to Don (and Jack) and get the money back. Please advise Matthew what he can do under the Goods Act and the ACL. Who is liable for Matthew’s losses and George’s injury? Discuss the 7 horses for China and 3 horses for George separately.
Corones & Clarke Australian Consumer Law, 5th edition, Lawbook Co, 2015 (Corones &
Clarke). You will also use this book in the unit, Law & Policy of Misleading Conduct and
Product Liability
Traves, Commercial Law, 3rd edition, LexisNexis, 2014 (Traves).
