Commercial Law Assignment Sample

Introduction - Commercial Law

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Commercial law of Australia make rules and regulations for all the commercial transactions including contract, agency, insurance, banking, finance, agency, export and import and many others. It is a system that applies rights and duties on all the activities in the field of commerce including merchandising, trading, sales & distribution and others. The current research key thrust is to apply principles of commercial law on the different case scenarios to take legal actions with the proper legal evidences. Moreover, the research will investigate the common law duty of negligence and the possible defences under it. In addition to this, Australian Consumer Law (ACL), part 3-5 will be discussed to identify possible rights available to different parties. Besides this, possible defences available to the goods manufacturer under section 142 of the ACL will be discussed.

PART A

Understanding Negligence in Sporting Events

Negligence can be defined as a failure to take reasonable duty of care towards other and its breach or violation caused damage to other. Thus, if a party who is liable to take proper care towards other but failed to exercise the expected care is known as negligence (Ben-Shahar and Porat, 2016). According to the case, P is a lifelong fan of ABC Football Club, when he was watching the game, suddenly, he was struck by a stray ball had broken P's glasses. The law of negligence applies on sporting events or contest because many-times, during game, injuries may be suffered by different people. As per the law, there are three most important requirements that need to be satisfied to proven negligence act by other that is mentioned below:

Duty of care: Defendant must owe standard duty of care towards the plaintiff and as per which, he or she is liable to take reasonable care to avoid any harm or injury.

Breach of duty: In order to claim for negligence, it is necessary that defendant failed to exercise reasonable actions to not harm the plaintiff. Thus, violation of the duty of care is necessary (Davis, 2012).

Damage: Breach or duty of care towards plaintiff must cause damage.

In a sporting event, all the players owe duty of care towards other competitors and spectators too hence, they are accountable to follow reasonable care and precautions to not harm other. While watching a sport, spectators are assumed with certain risks and such assumptions therefore, are a possible defence against claim while watching the tournament. Referring the case study of Cleghorn versus Oldham (1927), victim must prove three things to claim for negligence that is defendant owed duty of care, duty of care breached and as a result, claimant suffered damage. In contact sport like football and rugby, participants are liable to take reasonable steps to prevent any foreseeable injury to competitors, spectators as well as officials. Thus, referring the case scenario, player who stroke the ball and hit P owed duty of care. However, he failed to exercise such duty and as a result, P's glasses had broken. Thus, all the three elements of negligence proven, henceforth, it becomes clear that if the act of the player is a normal course of the game, then he would not be liable as he is not negligent, otherwise, P can take legal actions against the player and pursue claim. In the match, Coach do not recommend players to hit ball to the stands (Bird and et.al., 2014). Thus, coach did not owe such liability towards the spectators and due to absence of duty of care; P can't file any case against him.

As per Occupiers Liability Act 1985, occupier is defined as a person or company who is in actual possession of a particular place or area. Such occupiers owe duty of care towards all te participants, spectators as well as visitors. With reference to the sporting event, local council who owns the football ground owes duty of care towards all the participants, spectators and others. The council is accountable to provide safe environment to all so as to prevent any foreseeable injury or harm (Cameron, 2015). Referring the case law of Haris Versus Bulldog Rugby Legue Club (2006), court did not held club liable. In the case, one of the spectator had been injured by a firework when watching the rugby league game, however, as the authority already had carried sufficient search and attempted satisfactory security arrangements, therefore, the duty of care already had been fulfilled. Hence, there was no breach of duty that resultant damage or serious injury to the plaintiff ((Ben-Shahar and Porat, 2016).

In the case of Bolton Vs Stone (1951), Miss Stone had injured by a cricket ball outside the home. She took legal action against the cricket club in negligence and nuisance. The ground was surrounded by 7 foot fence and the distance between striker and fence was 78 yard. The claimant was sitting under 100 yards when she got stuck by the ball (Benacchio, 2015). In the case, decision held was that there is no breach of duty because the likelihood or possibility of harm is too law and defendant had already taken all the possible precaution to prevent such occurrence (Davis, 2012). The cricket club already had provided safe environment to the community. Thus, as per the case, local council is just liable to take reasonable precautions against the possible risk to eliminate it. In order to make spectators safe, council need to maintain a high fence around the ground. Thus, if it is maintained, then council is not liable otherwise, it can be sued.

Besides this, one of the leading case of Langham Vs Connell Point Rovers Soccer Club 2005 stated that occupiers and game organisers of the sport match have to take reasonable care to their spectators. In order to prevent any possible injury to occur, they held liable to take proper precautions and steps to prevent the breach of such duty (Barry, 2017). Therefore, the claimant was being rewarded with 233AUD due to tripping over loose rope in the car parking. The most important point in this case is that rope was of same colour to that of dirt in the parking therefore, it was invisible. Thus, in the case, club did not fulfil their duty by assuring that rope placed must be of different colour, so that, it could be see easily. Thus, as per the findings, it become clear that football club can't be sued because they did not directed the player to hit ball into the audiences, thus, if P file a case of negligence against club, then, he would need to prove that club did so as a result, he suffered loss (Cheeseman and Garvey, 2014).

PART B

1. Assessing Liability in Negligence: Lawnmower Explosion Case Analysis

In common law, negligence simply means failure to perform reasonable care towards other. In the case, A lawnmower had exploded in the front yard of the house because of faulty fuel tank. It caused serious damages or injuries to Ann as his legs got fractured with severe cuts. Due to severe impact, she was unable to work for the next three month. Besides this, due to such occurrence, computer disk that contain important data and files of Carol had been lost. Now, the question is that is both of them can sue Bruce, then, the answer is No. The reason behind this is it is unlikely that Bruce had breached any duty of care against the Pedestrian and his wife Carol. In this case, Bruce has no liability towards A and he has no idea that the fuel tank might be faulty (Clarke and et.al., 2017). Thus, it cannot be said that he had breached its duty of care; therefore, no doubt, Bruce cannot be claimed by Ann and Carol.

2. Manufacturer Liability and Duty of Care in Negligence

In common law duty of negligence, a manufacturer of the defective product or item is held liable for the negligence or breach of contract. In order to make manufacture liable, normal elements of the negligence must be proven. Under common law, manufacturers' liability is wider than the liability under contract or statute because it is not just limited to the contract made between purchaser and seller nor it is limited to the matter between goods owner and corporation under Competition and Consumer Act (Clarkson, Miller and Cross, 2014). Under common law, if a manufacturer found negligent in manufacturing, designing and presentation process. In this, goods maker owes liability towards all persons to whom it is likely that risk or damages can take place due to faulty item. Thus, as per this, he is liable towards buyer, pedestrian and all the other people.

Referring the current case law, Bruce had purchased the mower from Hank's Hardware, who purchased it from Distributors Ltd, which had been bought from Mower Ltd and the petrol engines were imported from Korea. Under common law, all of these parties owe standard duty of care towards pedestrian, buyer and others. It is because, mower is equipment that is used outside and it is likely or reasonably foreseeable that due to fault in the item, pedestrian may be injured too (Injury or Damage due to Defective Products, 2016). In this case, Hank, Distributors Ltd and Mower Ltd liable to perform duty of care towards Bruce. It is possible and foreseeable that any defects in the equipment can cause serious injury or harm to him. Moreover, i was obvious that if faulty supplies can cause injury to his wife, Carol. 

Thus, if in the case, it is found that suppliers unreasonably failed to exercise proper precautions against the faulty fuel tank; then breach of such duty of care can be easily proved. In such circumstance, there is a strong connection seems between harm caused as a result of breach. Here, no defence is available to Hank, Distributor and Mowers Ltd because Ann and Bruce have voluntarily assumed risk and it is not likely that they might be aware that the fuel tank may be faulty and explode (Eggen, 2015). It is because, in the voluntary assumption of risks, defendant can only avoid the liability by proving that plaintiff was fully aware of the risk and had full comprehension of the nature as well as extent to the risk. In the case, as pedestrians and Bruce had no idea that suddenly, the tank may be exploded, therefore, defendant can't get any defence (Clarke and et.al., 2017).

3. Liability and Claims Under the Australian Consumer Law

In the mentioned case situation, Ann, Bruce and Carol all were being affected by the explosion of fuel tank. Australian Consumer Law (ACL) is the uniform law that make rules and regulations targeting consumer protection. Part 3-5 of the ACL states statutory rules and regulations to deal with the liability claims for the damages, losses and injuries caused due to supply of defective goods. As per the statutory law, an individual can claim against manufacturer to get compensation if he or she had suffered injury or any serious harm due to the supply of defective item (Hawkins, 2017). Applying the rules to the case scenario, Pedestrian, Ann and Bruce's wife Carol do not have any possible right under Part 3-5 of the ACL because in the case, they do not appear as an affected persons and they do not actually bought the item from the supplier or derived the title or ownership rights. Therefore, they have no right to claim against the manufacturer or supplier.

However, on the other side, Bruce is the real buyer who made contract with the supplier and purchased the mower. Thus, being an original buyer or consumer, he had possible rights available in the Part 3-5 of the ACL. Section 138-141 of the act laid down rules and regulations upon bringing an action against the manufacturer where any loss or damage suffered due to the defective item being supplied by the manufacturer (Ng, 2017). In the case, explosion had resultant serious burn to Bruce and he was unable to work for next six months and incurred heavy medical expenditures. In the case, as defect in the tank is the main reason for the loss, thus, undoubtedly, Bruce can claim for the losses suffered under ACL. Besides this, Bruce also needs to replace the windows as well as front fence of the house. Section 141 of the Australian Consumer Law states that if defective item causes loss or damage to the fixtures, building and other equipments, then, individual that faced loss can claim for the damages (Pettigrew, 2015). Referring the current situation, Bruce has right to claim against Hank, Distributors Ltd and Mowers Ltd as he need to replace windows and front fence.

4. Legal Defense Analysis

Considering the case scenario, Hank, Distributors or Mower Ltd was discovered in default to supply defect-free items to Bruce. Section 142-148 of the Australian consumer Law mentions all the defences that are being available to the manufacturers that are given below:

1. Safety defect was not exists when the goods had been supplied to the buyer.
2. Defect cause just because mandatory standard and statutory rules were complied with.
3. The state of scientific as well as technical knowledge did not provided assistance to the manufacturer to find out the defect and /or
4. The goods were the part of other item and the defect was the result of design or packing of that other item (Zipursky, 2014).

Referring the current case, Hank's Hardware, Distributors and Mower Ltd were suppliers and the petrol engine had been imported from Korea. They all do not have too much scientific and technical knowledge, henceforth; they are not in the state in which they can discover that the item purchased is defective or faulty. Thus, it can be said that they can raise defence under point “C” mentioned above arguing that they were unable to recognize that the tank was faulty and could be exploded which had caused serious damage or loss to Bruce, A and wife Carol (Pettigrew, 2015).

Conclusion

From the facts obtained after applying the maxim, rules and regulations of the negligence aspects under commercial law, it is found that P who was watching football match and get hit by ball can sue player only, if the loss is not a result of normal course of actions. However, Coach can't be claimed and council and football club can be sued, if they failed to take reasonable duty of care towards the plaintiff taking into account the safety requirements of all. However, in the later part, it is found that under the common law, manufacturer is liable towards all the parties who are likely to face any loss or damage. Hence, they owes duty of care towards pedestrian, buyer and his wife too as faulty fuel tank can cause serious damage to any of them. However, under the Australian Consumer Law, only Bruce had right to claim because he is the original consumer and no rights is available to A and Carol. Lastly, the legislative rules determined that Hank's Hardware, Distributors Ltd and Mowers Ltd can get defence under part ‘C' of section 142 arguing that they was not in the state, in which, they can discover the defect easily.

Refrences

Books and Journals

• Barry, C., 2017. Statutory modifications of contributory negligence at common law. Precedent (Sydney, NSW). (140). p.12.
• Ben-Shahar, O. and Porat, A., 2016. Personalizing Negligence Law. NYUL Rev. 91. p.627.
• Benacchio, G.A., 2015. The harmonization of civil and commercial law in Europe. Central European University Press.
• Bird, R.C., . and et.al., 2014. Law, Business and Human Rights: Bridging the Gap. Edward Elgar Publishing.
• Cameron, G., 2015. International Business Law: Cases and Materials.
• Cheeseman, H.R. and Garvey, J.R., 2014. Business law. Pearson.
• Clarke, M.A.,and et.al., 2017. Commercial Law: Text, Cases, and Materials. Oxford University Press.
• Clarkson, K., Miller, R. and Cross, F., 2014. Business Law: Texts and Cases. Nelson Education.
• Eggen, J.M., 2015. Mental Disabilities and Duty in Negligence Law: Will Neuroscience Reform Tort Doctrine. Ind. Health L. Rev.. 12. p.591.
• Hawkins, J., 2017. Introduction: Female Perspectives in Commercial and Consumer Law. Columbia Journal of Gender and Law. 34(1). pp.1-4.
• Ng, E., 2017. Feeding the Minotaur: Is International Commercial Arbitration Hindering the Development of Commercial Law?. Asian Dispute Review. 19(1). pp.22-28.
• Pettigrew, W.A., 2015. A History of Commercial Law in the Atlantic World. pp.1450–1850.
• Zipursky, B.C., 2014. Reasonableness in and out of Negligence Law. U. Pa. L. Rev.. 163. p.2131.

Online

• Davis, C., 2012. Negligence and Risk Management and Sport. [PDF}. Available through: < https://researchonline.jcu.edu.au/25604/1/25604_Davies_2012.pdf >.
• Injury or Damage due to Defective Products. 2016. [Online]. Available through: < https://queenslandlawhandbook.org.au/the-queensland-law-handbook/health-and-wellbeing/accidents-and-injury/injury-or-damage-due-to-defective-products/ >.