Commercial Law Notes

Commercial Law Notes

Case Law Examples CHAPTER 4 CAUSING HARM VICARIOUS LIABILITY Century Insurance Co Ltd v Northern Ireland Road Transport Board [1942] AC 509 (employer was found viable because employee was carrying out an authorised task) PG 167 Deatons Pty Ltd v Flew (1949) 79 CLR 370 (Employer was not found liable, as they weren t acting within the scope of their employment) PG 167 THE TORT OF TRESPASS TO THE PERSON Stanley v Powell [1891] 1 QB 86 (Powell was not found guilty as the act has not negligent or intentional) PG 172 TRESPASS TO LAND Kelsen v Imperial Tobacco Co [1957] 2 QB 334 (Trespass to land was committed) PG 173 BATTERY Rixon v Star City Pty Ltd [2001] 53 NSWLR 98 (Battery wasn t committed as the physical contact was generally acceptable in the ordinary conduct of daily life ) PG 174 TRESPASS USING NECESSITY AS A DEFENCE Southwark LBC v Williams [1971] Ch 734 (The defence failed and Williams was guilty) PG 176 PUBLIC NUISANCE Silservice v Supreme Bread Pty Ltd (1949) 50 SR (NSW) 207 (Supreme was not guilty as the interference was not unreasonable) PG 178 DEFAMATION Bjelke-Peterson v Warburton [1987] 2 Qd R 465 (Defamation was satisfied, as it was defamatory as it portrayed the plaintiff as corrupt) PG 179 NEGLIGENCE REQUIRMEENT 1 A DUTY OF CARE Donoghue v Stephenson (1932) AC 562 (Guilty as a duty of care was required) PG 186 Bourhill v Young [1943] AC 92 (Not guilty, the harm was not reasonably foreseeable) PG 186 Chapman v Hearse (1961) 106 CLR 112 (Guilty, a duty of care was established through a chain of events) PG 187 Sullivan v Moody (2001) 207 CLR 562 (Not guilty, the salient features did not lead to a duty of care being established) PG 187 Tame v New South Wales (2002) 211 CLR 317 (Guilty, relationship was established leading to duty of care) PG 188

NEGLIGENCE - REQUIREMENT 2 BREACH OF THE DUTY OF CARE Bolton v Stone [1951] AC 850 (Not guilty, duty of care was not foreseeable with the small risk) PG 191 Woods v Multi-Sport Holdings Pty Ltd (2002) 208 CLR 460 (Guilty probability of harm) PG 191 Paris v Stephens Borough Council [1951] AC 367 (Guilty didn t take the burden of taking precautions) PG 192 Latimer v AEC Ltd [1953] AC 643 (Not guilty burden of taking precautions was significant and expensive, one that a reasonable person would not take) PG 193 Watt v Hertfordshire County Council [1954] 1 WLR 835 (Not guilty due to social utility of the activity) PG 193 McHale v Watson (1966) 115 CLR 199 (Lower duty of care minor guilty) PG 193 Cook v Cook (1986) 162 CLR 376 (Lower duty of care inexperience guilty) PG 194 Imbree v McNeilly (2008) 236 CLR 510 Lower duty of care inexperience not guilty overruled Cook v Cook decision) PG 194 Kondis v State Transport Authority (1984) 154 CLR 672 (non-delegable duty of care guilty) PG 196 NEGLIGENCE - REQUIREMENT 3 HARM CAUSED BY THE BREACH Yates v Jones [1990] Aust Tort Reports 81-009 (Not guilty factual causation) PG 198 Cook v ACT Racing Club Incorporated and the Australian Jockey Club Inc. [2001] ACTSC 106 (Guilty but for test with factual causation) PG 198 Overseas Tankship (UK) Ltd v Morts Dock & Engineering Co Ltd (The Wagon Mound No. 1) [1961] AC 388 (Not guilty scope of liability harm was not reasonable foreseeable) PG 199 Rowe v McCartney [1976] 2 NSWLR 72 (Not guilty harm was not reasonable foreseeable scope of liability) PG 199 DEFENCES FOR NEGLIGENCE Rootes v Shelton (1967) 116 CLR 383 (Guilty voluntary assumption of risk) PG 200 Agar v Hyde (2000) 201 CLR 552 Not guilty voluntary assumption of risk) PG 201 Ingram v Britten [1994] Aust Tort Reports 81-291

(Contributory negligence decision was split 60/40) PG 201 Manley v Alexander (2005) 223 ALR 228 (Contributory negligence decision was split 70/30) PG 201 Mercer v Commissioner for Road Transport and Tramways (NSW) (1936) 56 CLR 580 (Guilty breach of duty of care compliance with standard practise failed) PG 203 Australia Safeway Stores Pty Ltd v Zaluzna (1987) 162 CLR 479 (Occupier s liability guilty, didn t take reasonable precautions) PG 204 Phillips v Daly (1988) 15 NSWLR 65 (Occupier s liability not guilty as the plaintiff contributory negligence) PG 204 Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254 (Occupier s liability not guilty harm was not foreseeable and unreasonable) PG 204 Hackshaw v Shaw (1984) 155 CLR 614 (Occupiers liability guilty still a duty of care even though they were stealing from the farmer) PG 205 Nagle v Rottnest Island Authority (1993) 177 CLR 423 (Liability of public authorities guilty failed to warn swimmers) PG 205 Romeo v Conservation Commission of Northern Territory (1998) 192 CLR 431 (Liability of public authority not guilty danger was obvious to the plaintiff) PG 206 THE TORT OF DECEIT Bisset v Wilkinson [1927] AC 177 (Not guilty it was an honest opinion and reasonably held and was not fact) PG 210 THE TORT OF PASSING OFF Pacific Dunlop Ltd v Hogan (1989) 23 FCR 553 (Guilty misrepresentation was evident) PG 211 Newton-John v Scholl-Plough (Aust) Ltd (1986) 11 FCR 233 (Not guilty no misrepresentation was made) PG 211 THE TORT OF INTIMIDATION Rookes v Barnard [No1] [1964] AC 1129 (Guilty the threat was made) PG 212 THE TORT OF INTERFERENCE WITH CONTRACTUAL RELATIONS Lumley v Wagner (1852) 1 De G M & G; 42 ER 687 (Guilty X actions intended to breach the original contract) PG 212 HARM TO THE PERSON/PROPERTY OF A THIRD PARTY Willemstad (1976) 136 CLR 529 (Guilty negligence caused financial harm to the plaintiff) PG 213 Perre v Apand Pty Ltd (1999) 198 CLR 180 (Guilty negligence caused financial harm to the plaintiff) PG 214 DEFECTIVE PRODUCTS Junior Books Ltd v Veitchi Co Ltd [1983] 1 AC 520

(Guilty defective flooring caused financial harm) PG 214 NEGLIGENT MISSTATEMENT Hedley Byrne % Co Ltd v Heller and Partners Ltd [1964] AC 465 (Not guilty only due to the disclaimer that was issued, because economic loss was suffered due to the negligent advice given) PG 215 Rentokil Pty Ltd v Channon (1990) 19 NSWLR 417 (Guilty negligent advice led to economic loss) PG 215 L Shaddock & Associates Pty Ltd v Parramatta City Council [No 1] (1981) 150 CLR 225 (Guilty advice was relied upon which resulted in economic loss) PG 216 Essanda Finance Corporation Ltd v Peat Marwick Hungerfords (1997) 188 CLR 24 (Not guilty as the advice was passed on the a 3 rd party and this was not foreseeable by PMH) PG 217 TIME LIMITS Wilson v Horne (1999) 8 Tas R 363 (Only guilty on the action that lapsed in time) PG 221 CHAPTER 5 MAKING DEALS REQUIREMENT 1 AGREEMENT Goldsborough Mort & Co Ltd v Quinn (1910) 10 CLR 674 (Quinn didn t keep option open for GMC, therefore breaching the contract) PG 233 Ramsgate Victoria Hotel Co Ltd v Montefiore (1866) LR 1 Ex 109 (Offer lapsed therefore no contract could be breached) PG 233 Carhill v Carbolic Smoke Ball Co [1893] 1 QB 256 (Wording of the environment dictated that the ad was more than an invitation to treat, it was a legal offer to the world at large) PG 234 Smythe v Thomas (2007) 71 NSWLR 537 (Online auction the listing is an offer, unlike a traditional auction where it is an invitation to treat) PG 236 Powell v Lee (1908) 24 TLR 606 (Acceptance was not communicated therefore there was no contract) PG 237 R v Clarke (1927) 40 CLR 227 (A person cannot accept an offer by conduct unless acting in reliance on the offer, which did not occur in this instance) PG 238 Adams v Lindsell (1818) 1 B & Ald 681; 106 ER 250 (Postal rule contract was formed as a letter was sent, even though it was not received) PH 239 REQUIREMENT 2 INTENTION Balfour v Balfour [1919] 2 KB 571 (No contract as it was a domestic agreement that was not intended to be legally enforceable) PG 242

Wakeling v Ripley (1951) 51 SR (NSW) 183 (A contract was made even though it was a domestic agreement because of the seriousness of the move) PG 243 Rose & Frank Co v JR Crompton & Brothers Ltd [1925] AC 445 (No contract was formed as there was an honourable pledge clause that allowed the actions performed, even though it was in a commercial setting) PG 244 Ermogenous v Greek Orthodox Community of SA Inc (2002) 209 CLR 95 (Religious presumptions in no excuse to forming a legally binding contract) PG 244 Masters v Cameron (1954) 91 CLR 353 (Preliminary agreement dictated that there was no contract formed) PG 245 Carlill v Carbolic Smoke Ball Co [1893] 1 QB 256 (Mere puff was used as a defence but did not work as the wording of ad was very specific) PG 245 REQUIREMENT 3 CONSIDERATION Carlill v Carbolic Smoke Ball Co [1893] 1 QB 256 (Consideration was given as the Carlill suffered from the product) PG 246 Thomas v Thomas (1842) 2 QB 851; 114 ER 330 (Consideration need not be adequate, $1 was paid in this case) PG 247 White v Bluett (1853) 23 LJ Ex 36 (The promise was vague therefore consideration was not made) PG 248 Placer Development Ltd v Commonwealth (1969) 121 CLR 353 (The payment was to vague for consideration to be met) PG 248 Roscorla v Thomas [1842] 3 QB 234; 114 ER 496 (No consideration was made the promise made was past consideration) PG 248 Ipex Software Services Pty Ltd v Hosking [2000] VSCA 239 (Consideration was paid at the request of the person who subsequently made the promise, this is not past consideration, a contract would be formed) PG 249 Stilk v Myrick (1809) 2 Camp 317; 170 ER 1168 (Consideration was not made as it was due to a prior legal obligation) PG 249 Hartley v Ponsonby (1857) 7 El & Bl 872; 119 ER 1471 (Consideration was made as consideration was more than what the prior legal obligation required) PG 250 Foakes v Beer (1884) 9 App Cas 605 (Part payment of a debt is not considered consideration) PG 250 Musumeci v Winadell Pty Ltd (1994) 34 NSWLR 723 (Practical benefits test was satisfied, therefore contract was formed) PG 252 Central London Property Trust Ltd v High Trees House Ltd (1947) 1 KB 130 (Promissory estoppel was satisfied to restore equity and justice) PG 25

Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387 (Promissory estoppel was satisfied to restore equity and justice) PG 253 Giumelli v Giumelli (1999) 196 CLR 101 (Promissory estoppel was satisfied, damages was paid as compensation) PG 254

Chapter 1 Introductory to Law Law s Ideals include: -Flexibility -Accessibility -Certainty -Fairness Law attempts to: Resolves disputes, Maintains social order, Preserves and enforces community values, Protects the disadvantaged, Stabilises the economy, and Prevents the misuse of power Categories of Law The law changes regularly because of: (5 things) political change, the need to fix problems with the law, changing community values, pressure from lobby groups, and changing technology. Law involves the following: Politics, Ethics and Justice Justice can be understood as fairness, such as fair compensation or punishment, a fair decision or a fair distribution of resources. The notion of fairness has influenced the development of business law in many ways. The relationship between law and justice may not be necessary, but it is desirable. There are three types of justice: Distributive justice Procedural justice Retributive justice

A legal choice is one that complies with the law; an ethical choice is one that is recognised as good and right. Law and ethics generally correspond, but: A decision that is legal may not be ethical, and A decision that is ethical may not be legal. While the law is more than merely politics, the law is shaped and influenced by power and politics. Particular laws are usually the expression of a political ideology. Legislation is made by politicians to implement government policies and achieve political objectives. The 3 Arms of the Government Separation of Powers: Theoretically, the legislature, the executive and the judiciary should as far as possible remain functionally separate. In Australia, members of the executive (the Prime Minister / Premier / Chief Minister and the other Ministers) are also members of the legislature (the Parliament), which means that the legislature and the executive are not strictly separate. Responsible Government: The Australian legal system is similar to the British legal system in that is seeks to incorporate separation of powers, but also the doctrine of responsible government. Forms of Government: Types of Legal Systems Civil law legal systems are the most common type of legal system. The primary source of law is legislation in the form of codes, statutes and constitutions; case law is generally not recorded and is not recognised as a source of law. Examples include France, Germany, Russia, China, Japan, Thailand and Korea. Common law legal systems are based on the British legal system.

The two main sources of law are legislation and case law; the judiciary is much more powerful and influential in common law countries than in civil law countries. Examples include the United Kingdom, Australia, Canada and New Zealand Characteristics of a Legal System These ideals make up our national legal system Liberal democracy: Laws are made by, and the executive government consists of, elected representatives who exercise their power subject to the rule of law and to the various Federal and State constitutions. Common law legal system: Our legal system is based on the British legal system, and can be contrasted with other forms of legal system such as the civil law legal system. Constitutional monarchy: The Head of State of the Commonwealth of Australia and of the various States is Elizabeth II, Queen of Australia. Federation: In addition to be the national Federal (or Commonwealth) government there are various State governments that are not subordinate to the Federal government (separation of powers). Separation of powers: Laws are made by a parliament; administered by an Executive Council or Governor in Council; and interpreted and applied to particular cases by a court system. Responsible government: The Ministers comprising the executive are elected representatives who are also members of and are answerable to the legislature. Division VS Separation of Powers

History of the System For tens of thousands of years prior to British settlement there was in existence in Australia a sophisticated and effective legal system: the Indigenous Australian legal system. Unfortunately, the British did not recognise or acknowledge the Indigenous Australian legal system upon their arrival in the 1700s. Australia was declared to be terra nullius (belonging to no one or an empty land, by deeming it this you can bring your laws over which is what the British did, called the doctrine of reception) at the time the colony was established. Australia was deemed to have been settled by Britain rather than conquered by Britain or acquired by treaty. British settlers brought British law with them according to the doctrine of reception. The New South Wales colony and the other colonies subsequently established in Australia were initially controlled directly by the British government as represented by the colonial Governor. As time passed, the British government granted the Australian colonies increasing levels of independence. By the late 1800s, six relatively independent self-governing colonies existed on the Australian continent, each with its own constitution, legislature and court system. The Commonwealth of Australia came into existence on 1 January 1901. Each of the colonies, now States, gave up certain powers and rights to the new Federal government, and at the same time retained their individual identities and substantial legislative authority. Today, Federal, State and Territory governments in Australia are free from interference by the British Parliament. The final step will be changing from a constitutional monarchy to a republic: but are we ready?