LST5CCL - Foundations of Company and Commercial Law - Tom and Jerry Case Study - Laptop Disaster - Business Law Assessment Answer

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Assessment Task:
LST5CCL - Foundations of Company and Commercial Law Assessment Answer

Scenario 1: Business venture 

Tom and Jerry are two very close brothers who have recently entered into a contract, whereby they jointly own TJ & Partners, a brand-new tech firm in Melbourne, Australia. Over the years they have had no major arguments or disputes, however, this new business venture has put their relationship to the limit. Multiple employees are concerned about their yelling and the hostile environment that is being caused by Tom and Jerry’s relentless arguing.

After a number of complaints, Jerry decides that he is fed up with Tom and decides he wants to walk out of the business. Tom and Jerry sit down for another meeting so Jerry can discuss his exit plan. The meeting goes poorly, and Jerry leaves yelling “I own 50% of this company, if you want this company to continue, you must buy me out!” 

Tom is left angry and confused. Reluctant to buy out his brother, he decides to consult his lawyer on whether he has to pay Jerry. The lawyer suggests that there may not be a valid contract at all. 

Task: You are Tom’s lawyer. Using principles of Contract Law advise Tom whether a valid contract between Tom and Jerry has been properly formed. In doing so, please rely upon case law. 


Scenario 2: Laptop Disaster

A few months later, all is resolved between Tom and Jerry, and their jointly owned business is doing extremely well. Their profits have skyrocketed. They have recently purchased 200 brand-new special edition laptops for their employees as a thank you. Each of these laptops is top of the line, and worth over $3,000.00. Due to the value of these special edition laptops, Tom and Jerry decide they have to be very careful with choosing who be responsible for their delivery from the manufacturer. Tom and Jerry decide to meet with StarShipping Pty Ltd, a well-known delivery company. 

In their meeting, StarShipping Pty Ltd is eager to please and provides their best driver for the task, Sunny. Tom and Jerry are extremely happy with the proposed cost and professionalism of both StarShipping and the chosen driver Sunny. Later that afternoon, the contracts have been finalised. Tom and Jerry are too busy talking with StarShipping and Sunny, that they forgot to read the Terms & Conditions. Tom and Jerry sign the contract, right underneath an apparent exclusion clause. 

Clause 5.6 stated: StarShipping does not take any responsibility for any loss or damage to any goods carried by their employees, pursuant to this contract however such loss or damage may arise or be caused whether by negligence or otherwise.

Later that week, the 200 laptops are ready for delivery and Sunny collects them from the manufacturer, loads them into the truck and departs for TJ & Partners’ office. Along the way, Sunny receives a phone call from his friend asking him to pay him a visit, as his brand new Mustang has arrived from the US. Excited to see his friend’s new car, Sunny decides to make a quick detour. On his way to this friend’s house, the traffic increases. Sunny had been on the phone and not paying attention, negligently leaves his truck sitting across a training. Sunny becomes increasingly concerned when he sees the boom gates lower, with the signals flashing. Sunny looks to his left and there is a freight train speeding towards him. With only enough time to get himself to safety, Sunny runs across the tracks. The freight train slams into Sunny’s truck and all the laptops are destroyed.

When StarShipping notifies Tom and Jerry of the unfortunate events, they are furious. 

Tom bursts out “You are reckless and negligent! You will be held liable for this! You will hear from our lawyers!” 

Feeling quite confident about themselves, StarShipping simply replies: “You signed the contract, we are not liable! You agreed to our Terms & Conditions!”

Tom and Jerry decide to consult their lawyers to see whether they are bound by what they have signed and whether the exclusion clause is applicable.

Task: You are Tom and Jerry’s lawyer. Using principles of Contract Law advise Tom and Jerry whether StarShipping are liable to pay for the destroyed laptops. In providing your advice, please rely upon case law. 

Task 3: Statutory Guarantees 

The Australian Consumer Law outlines numerous protections for consumers when purchasing goods. What must be proven before statutory guarantees are applicable? Please discuss TWO statutory guarantees that apply to consumer goods. This discussion should include a reference to TWO cases.


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  • Posted on : November 28th, 2018
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