Globalisation

- CLASS NOTES –
What is law?
Rules within a legal system. A law can be enforced with the help of a legal system.

1788 Australia was called terra nullius (empty/uncivilized land.)

1992 High court Mabo v Queensland no 2
Aboriginal claiming back land
British claimed no existent legal system.

Def. Legal system:
- Coherent group
- Structure
- Separate system of government
 International definition

Parliament/Court makes law
Police enforces law

Sources of law: parliament statue law
By judge common law

FIVE SOURCES- p.5

- Custom: set of rules to which whole community obeys

- Common law: main source of law, law from decisions of judges in court.
Based on precedent. = equity  chancery

- Statue law: written law made by parliament
= delegated legislation

CLASSIFICATION OF LAWS
1. International law  national law  domestic law  municipal law

SEPARATION OF POWER

Federal government  concurrent law  State law
(May lead to conflict/inconsistency of law)

2. Public law (man vs. man) - Private law (man vs. man)
3. Criminal law - Civil law
4. Substantive law - Procedural law

CHAPTER FIVE – FORMATION OF A CONTRACT
Agreement Contract
Not legally binding Legally binding

Most important legislation: TRADE PRACTICES ACT (TPA) 1974
- prohibits misleading or deceptive conduct

Making a valid contract requires six prerequisites
1. Intention to create legal relations
2. Agreement
3. Consideration
4. Legal capacity
5. Genuine consent
6. Legality of objects

A contract may be:
- Simple contract; straightforward
- Formal contract; signed, sealed and delivered with a deed.
- Bilateral; Paint my room? Ok.
- Unilateral; accept by doing something

Must a contract be in writing?
Not always. Must be considered with reference to the operation of the Parol Evidence Rule.

PAROL EVIDENCE RULE
Parol evidence is unable to vary, contradict, and add/subtract from the words in a written document. If both parties intend to put all terms in writing, the document becomes the complete contract.

Exemptions: (allows outside evidence in interpretation)
- prove written document is invalid for some reason
- party to contract is an agent or other person
- prove particular transaction was intended to be partly writing/oral
- to establish trade usage
- prove correct nature of transaction

Three usualites
- translating
o explain ambiguity
o demonstrate a description is false

CONTRACTS THAT MUST BE WRITTEN
- bills of exchange and promissory note
- cheques
- hire/purchase of a car
- assignments of copyrights, designs, patents
- marine insurance
- acknowledgements of statued barred debts
- arbitration agreements
- assignments of life insurance policies
- maintenance agreements
- employment of seamen
- all contracts by deed
- real estate
- transfer of shares in a company
- consumer credit
- mortgages of goods/guarantees
- consumer leases regulated by the consumer credit legislation

CONTRACTS THAT MUST BE EVIDENCED IN WRITING
- promise by executor or administrator to pay liability of dead out of own money
- agreement in consultation of marriage
- contract of guarantee
- contract for the sale of land or interest in land
- contract not to be performed within one year of being made

Evidence
o name of parties
o subject matter
o consideration (price)
o signatures of the parties

DEEDS
Deed = formal contract

Differences between simple and formal contract
- validity depends on formal requirements (simple contract nothing)
- no consideration (simple must have consideration)
- parties in deed contracts can bring action at common law for non-performance

INTENTION TO CREATE LEGAL RELATIONS
Contract law requires evidence of intention of the parties (expressed or implied) to go beyond and agreement and to enter a contract.

1. Parties to a business agreement intend to make a contract
2. Parties to a family, domestic, social, voluntary agreement do not intend to be legally bound (“test of intention” is objective, drawn from conclusions of words or conduct of parties involved)

BUSINESS OR COMMERCIAL AGREEMENT
Idea “business agreement:  legal action” can be reversed. E.g: parties agree agreement is ‘honour only’.

Agreement  contract: depending of words, actions, intentions

COMFORT LETTER
Is an expression of expectation, hope or intention to provide some moral responsibility (comfort).
Decisive is whether terms of letter were of sufficiently promissory nature to be held to be contractual.

FAMILY; DOMESTIC; SOCIAL AND VOLUNTARY AGREEMENTS

Legal presumption that parties of this do not intend to be legally bound. If parties wants it legally, it should be made very CLEAR, supported by a note, ideally prepared by a legal advisor.

What makes a legally enforceable document?
1. Offer made by one party
Accepted by the other party.
2. “Global approach” interpreted from acts, conducts, even absence of words

NOTE
- an agreement may be preliminary
- proof of “real meeting of minds”
- entered freely

Under traditional rules of offer and acceptance, acceptance must be complete and unqualified. A counter offer is considered a rejection of offer.

ADR = Alternative Disputer Resolution

Risk with going to court: 50:50
Risk with ADR bigger possibility to create a win-win situation

Ways to solve legal issues:
1. Selfhelp
2. ADR

Australia began as a British colony, but as time went on the various Australian colonies became more and more independent from Britain and eventually in 1901 the six colonies united in a federal system of government. We call this federation of Australia. The federation was achieved by the British parliament passing the “Commonwealth of Australia Act” 1900 (Australian constitution).

The effect of federation
Before the federation, each state made its own laws under its own constitution.



Exclusive federal powers  concurrent powers  Residual state power

After the federation each state agreed to hand over some power to the federal which were written into the constitution. Federation therefore created a division of lawmaking powers between the federal and state parliament.

 The certain powers are issued in SECTION 51

The doctrine of separation of powers under the Australian constitution
1. Legislative  parliament (makes law)
2. Executive  ministers in government (administer law)
3. Judicial  judges/courts (enforces law)

HIGH COURT OF AUSTRALIA
The highest court in the land of Australia, and it was established under the Australian constitution when Australia became a federation.

How is legislation made?
Parliament makes legislation.
Legislation begins with an idea, usually developed by the minister who is responsible for that area of government. The minister then takes the idea to his cabinet (ministers who sit in government). If cabinet approves, instructions are sent to the office of the parliamentary counsel who will draft a bill.

BILL  approval from parliament  ACT
There is then a special procedure under which the bill is presented to parliament and goes through houses of parliament. Eventually if parliament approves, the bill will become and act and will apply to Australian citizens as law.

NOTE: Interpretation of legislation
sometimes in legislation the words of the act may be unclear. It may be necessary for the judges in court to interpret or give meaning to the words. This process is called statutory interpretation.

- COMMON LAW –

The words “common law” can mean several things, however we are using it to mean decisions made by judges or case law.
The basis of common law is precedent/stare precedent. This means that cases which are similar to previous cases must be decided in the same way. There are rules about HOW precedent is applied in the court hierarchy (e.g. a lower court has to follow the case/precedent from a higher court, but not vice versa).

Where do we find common law?
Decisions of judges are reported in volumes called “Law reports”. A typical law report gives the names of the parties and tells us whether the case is an appeal and the date of the appeal- There is usually a head note (summary of facts and earlier decisions).
Then the person reporting the case, usually a barrister, gives the reasons for the decision called ratio decidendi. This is binding precedent, the part of the decision that has to be followed by a lower court. After the head note is the actual case, the words used by the judges; called judgement.

E.g. Donahue vs. MacAllister (1932) AC 562

- CONTRACT LAW -
A contract is defined as an agreement between two or more parties which the law will enforce. We see from this that although all contracts are agreements, not all agreements are contracts. For an agreement to be enforceable contract the agreement must contain some essential elements for it to be enforced by the court.
THE SIX ELEMENTS
A contract cannot exist unless both parties intend to enter a legally binding agreement. E.g. we ask:
Did the parties intend to be obligated to perform their promises?
If not, the agreement is not a contract and we say that the agreement is void ab ignition (of no effect from the beginning.

1. INTENTION § 5050-5130
Sometimes the parties expressly state whether they intend to be legally bound and the courts in such case will give effect to what the parties have stated.
Case ex: §5-5060
Rose and Frank Company v JR Crompton & Bros Ltd (1923) 2 KB 261
The agreement was terminated without the required notice being given and P sued for damages for breach of contract. The action failed – there was no contract but only an agreement binding in honour.

Jones v Vernon’s Pools ltd (1938) 2 ALL ER 626
Some competitions say that entering the competition does not create a legal relationship between the entrant and the competition organisers such as the statement appearing on an entry ticket which read “entry to this competition does not constitute a legal relationship between the entrant and the competition organisers.

A problem arises when the parties do not expressly state whether they intend to be legally bound or not. And it’s then up to the court to decide the intentions of the parties. To do this the court uses and objective test. Here the law divides agreements into two types and it implies a different presumption to each time.

Social, domestic agreements vs. Commercial, Business agreements
Presumption: No intention to be legally bound there is intention

Balfour v Balfour § 5090

Rebuttable: is there any evidence to the contrary?

If so  contract if so  no contract
If not  no contract If not  contract

2. AGREEMENT
Agreement is made up from offer and acceptance.
- an offer is an indication by one party to another (offeror to offeree) of his/her
willingness to enter into a contract with the other person on certain terms. An offer has to be distinguished from a “puff” (advertiser’s gimmick).

§ 5-170
Fisher v Bell
D, a shop owner, was prosecuted under legislation which prohibited offering flick-knives for sale. D was acquitted, because displaying an item in the shop window, with a price tag, was not an offer to sell – it was an invitation to treat. The customer makes the offer, which will become a contract if the shop accepts it.
An invitation to treat is not an offer, it is an invitation to the customer to come in and make the offer.

Boot’s case established that gods displayed in supermarket shelves, shop window or advertisement is NOT an offer. They are an invitation to treat.

A puff is an advertisement gimmick or trick which is NOT an offer. With puffs there is usually no intention to enter a contract and no offer which can lead to a contract. But see case § 5212 where the court said that the words are specific it may be that they will amount to an offer.

INQUIRIES
An inquiry or request for information is NOT an offer.
§ 5200 Harvey v Facey
Just stating the lowest price at which the vendor would sell does not contain an implied contract to sell at that price to the person making the inquiry.

RULES OF OFFER
1. An offer can be made to the whole world or a specific person or to a class of persons. (Carlill’s case?...)
2. An offer stays open until it is cancelled or revoked, so as long as it has not been accepted by the offeree. If the offer is accepted before it is cancelled a contract will exist between the parties. However, for proper acceptance to take place the offer must be accepted within the time stated, or if no time is stated, within reasonable time.
3. An offer must be communicated to the offeree. In other words, it is not possible to accept an offer which you are not aware. See R v Clarke §5230
4. An offer will die/end if the offeree makes a counteroffer.

ACCEPTANCE
Acceptance is a communication to the offeror of an unconditional agreement to the terms of the offer and a commitment to the contract.

1. In general acceptance has to be actually communicated to the offeror. The exemptions to this rule are
a. where the offeror has dispensed with the need to be notified of acceptance
b. where acceptance is to take the form of an act
c. where the postal acceptance rule applies
2. Acceptance must be within the rules of offer
3. Acceptance must be unconditional (no counter offer)
4. Silence cannot be acceptance (§5310).

ACCEPTANCE BY POST AND THE POSTAL RULE
The general rule is that acceptance must be actually communicated to the offeror. An exemption to this rule is where acceptance is made by letter or telegram where acceptance takes place as soon as letter is posted or telegram sent. This is so even if the letter is lost in the post or never reaches the offeror.
See Adams v Lindsell §5330
Burn v Berntin §5360
NOTE: There are some exemptions to the postal rule
1. The postal rule does not apply if it is specifically excluded or if the offeror requests acceptance by certified mail.
2. If the offeror requests to be notified of acceptance within a specified or stated period.
3. To telex/fax but see also acceptance by e-mail/sms. See case §5320

CONSIDERATION §5400-5480
Consideration is something done or promised in exchange by the other party. Can be an act for an act, or an act for a promise or a promise for a promise. It can also be a promise to NOT do something or to stop doing something.

RULES OF CONSIDERATION
1. Consideration is essential for simple contracts (not necessary in formal contracts). It is missing in a simple contract, it will be void.
2. Must be present or future, can NEVER be past.
§ 5410 Roscola v Thomas
3. Consideration must move from the promisee, but not necessarily to the promisor. §5405
4. Must be definite (no vague or illusory). Therefore a promise to give someone love and affection is not good consideration. Similarly a promise to give someone some of my property is too vague.
5. Must have some value but the value does not have to be adequate. §5440
6. A promise to do something that you are already obligated to do, is NOT good consideration unless you give something more than what you are obliged to do. § 5470
7. Similarly a promise to pay part payment in satisfaction of the whole §5480, then it’s good.

NOTE: Rule of part payment of a debt was stated in Pinel’s case §5480 and was applied in the case of Folks v Bear. However, the strictness of these rules is restricted in some cases.

PROMISSORY ESTOPPEL (PE)
PE developed from an English case (§5485) called “The High Trees”-case and has been developed in Australia by the High Court. Basically PE is an exemption to the strict rule which requires consideration to make a promise enforceable. For the PE to apply certain essential elements must be present. (Page 332, important cases p 333).

CAPACITY TO ENTER A LEGAL CONTRACT
- minors, unsound people, intoxicated cannot enter a contract

Minor §5010-5170 (§5530 very important case)

In NSW a minor is a person under 18 years of age.
Minors (Property and contracts act 1970). Under this act minors become fully civil acts if they are 18 or over. And civil acts include contracts. However, if a minor enters a contract, it is not binding if the minor did not understand what they were doing. However, it is still presumptively binding on the minor as long as it can be shown by the other party that the contract was for the BENEFIT of the minor.
(Benefit = not defined in the act, means more than just basic necessities and a court would consider the contract as a whole after looking at the minor’s age, where they stand in life and whether they are already supplied with the goods and services contracted for and whether the contract is of advantage to them (§5530).

- persons of unsound mind and intoxicated
A contract made with a person who suffers from mental ill capacity incl drunk/drugged cannot be enforced against the incapable person. However, the person who wants to avoid the contract (the incapable) has to show two things:
1. At the time when the contract was made, they did not understand the nature of what they were doing.
2. The other party knew or should have known of the incapacity.

GENUINE CONSENT

Non est factum = It is not my act/deed
Fundamental mistakes as to the nature of the document.

§5690 Petelin v Cullin
This defence is only available to persons who because of a mental or physical disability make a mistake about what the document is (not the legal content).
NOTE: If a person is merely careless and makes this mistake because of negligence they cannot use this defence.

- MISREPRESENTATION –

A misrepresentation is a representation (statement/fact) which turns out to be untrue. Misrep often takes place during negotiations when either before or at the time of making the contract one of the parties makes statement or this statement is

1.false of fact (i.e. not opinion)
2. is intended to induce the other party to enter into the contract
3. does in fact lead the other party to enter the contract

There are three types of miser at common law as well there are statutory law (i.e. parliament has made laws TRA about false or misleading statements.
See SECTION 52 which deals with misleading of deceptive conduct by corporations.

FRAUDULENT
Def. A deliberate untruth made knowingly with reckless disregard as to whether true or false.
Action: tort
Remedies: Innocent part can rescind contract and/or sue for damages.
Case: Perry v Peek
INNOCENT
Def: A false statement but is not made fraudulent (maker believes it is true).
Remedies: No remedy at common law. Cannot sue for damages BUT can rescind contract.
Consider: Does section 52 TPA apply?

NEGLIGENT
Def: Where a person gives information or advice on a serious business matter in circumstances where speaker realises or should realise that they are being relied on to give the best advice as a basis for other party’s decision to enter a contract they give careless or negligent advice to.
Action: tort (P must prove that)
Remedies: Innocent party can rescind and/or sue for damages.
Case: Shaddock v Parramatta Council.

Legislation of misrep
1. Sale of Goods Act 1923 NSW
This act retains the rule of equity to allow a party to rescind a sale of goods – contract if misrepresentation exists.
2. TRA 1973 Commonwealth
Statements which are misleading or deceptive may be actionable under section 52. If the misrep is unconscionable, then section 51 AA-51 AC TPA may apply. Section 53 may apply in the case of false or misleading representation.
NOTE: Some of the limitations of the common law do not exist under the TPA, e.g. the misrep does not have to actually mislead i.e. not necessary to show that anyone acted on the misrep and suffered damage. It is enough to show that the statement/conduct is likely to mislead. Therefore the TPA may apply to give someone remedy even where the common law does not apply.

UNDUE INFLUENCE UI
This occurs when a party in a superior position i.e. parent, doctor, teacher, in a weaker position to enter an agreement or make a gift against their will. In some relationships there is a presumption there was UI i.e. parents over children, doctor over patient. In this situation it is presumed UI the superior person has to show/rebut that they did not influence. They can do this more easily if it can be shown that the weak party had independent advice and entered from their own free will.

§5720 UI = voidable

DURESS
Actual or threatens violence to the person who enters the contract and their relatives.
See TPA 51 AA; AB; AC

CONTENTS AND INTERPRETATION
A contract can be oral, written or partly written/partly oral. If one party sues for breach of contract, the court will have to decide what the terms of the contract were and how important they were. If a contract in wholly in writing the court will only look what it is in the contract. This is called the PAROLE EVIDENCE RULE.

TERMS OF A CONTRACT
A term in a contract can be
1. a condition
2. warranty
3. intermediate/innominate

EXEMPTION CLAUSES
There are clauses in the contract designed to reduce/exclude the legal liability of one of the party’s to the contract. Exclusion clauses can appear in signed documents, unsigned documents incl
tickets, receipts, even notice boards.

SIGNED DOCUMENTS
The general rule if a party signs a contractual document with an exclusion clause, the clause is binding even if they have not read it. § 6190

UNSIGNED DOCUMENTS
Here the exclusion clause will only apply if the person against it operates was aware of its existent. And the test here is to ask: Would a reasonable person expect such a document to include a contractual term?
If not, the exclusion clause will not apply.
§6200 Causer v Browne*
Even if the document is a contractual document the next question is: Was the party given notice of the exemption clause?
§6210 Thompson v Scottish Railway
The notice must be given at the time the contract was made §6220.

PRIVITY OF CONTRACT §2260

DISCHARGE OF CONTRACT
How to end a contract:
- performance
- agreement
- operation of law
- frustration
- breach of contract
- assignment

FRUSTRATION §6390, 6290, 6360, 6370 *Cadelfa-case
This occurs when after entering a contract there is an unexpected event which makes performance of the contract either impossible or very radically different from what the parties contracted for.

What is the effect of frustration?
It terminates all future obligations between the parties. Sometimes this causes injustice especially i.e. one party has suffered loss and the other has not.

DISCHARGE BY BREACH
If one party breaches the contract, the other party is entitled to sue for damages. However, the other party (innocent) is not necessarily entitled to end the contract. The right to end the contract will only apply where the party in breach has repudiated the contract.

Repudiation is an indication by one party before the time for performance has come, that he or she will not keep the contractual obligations. This type of repudiation is called anticipatory breach.

Repudiation can also occur where performance has begun and one party fails to perform an essential term of the contract. Indicates by their conduct that they are repudiating the contract. This is called actual breach.

REMEDY OF DAMAGES
Damages is a common law remediation; money compensation, which the innocent party is entitled to. The courts have rules about what type of loss you can claim for. The test was stated as “the rule in Hadley v Borennde. (Studyguide)
The innocent/defendant must take steps to minimize his or her loss = mitigate.

§ 7010
CONSUMER LAW
- Supply of goods and services –

Sale of Goods Act NSW 1923
This act codifies (puts together) the common law. It applies only to goods, not services, and to all contracts for sale of goods under which at least some money exchanges hands in consideration for the goods.
The purpose of the act is to regulate the sale of goods and it provides that the rights, as well as duties of the seller and the buyer.
§ 7011
Although the parties can agree that the act in general does not apply to their contract, there are certain provisions (sections) in the act which cannot be excluded and will apply to a sale of goods (section 62) regardless of the wishes of the contract i.e. the acts that when goods are sold under a “consumer” the goods must be fit for the purpose for which they are bought and they must be of merchantable quality.
Since Sale of Goods Act only applies to goods, it is important to distinguish between a contract for sale of goods and other contracts (such as services, work and material  all covered by TPA).
From the cases we see that the test is to ask what is the main purpose of the contract? If it is to transfer the ownership of goods, then it is a contract for sale of goods. If however the main purpose of the agreement is to obtain the skill and expertise of the other party, then it is a contract for the supply of work and materials and therefore will not be covered by Sale of Goods Act. § 7105

Robinson v Graves (Music is not goods until it is published).

- Classification of goods -
Sale of Goods Act classifies goods as different types: goods can be existing (owned by the seller  specific, unascertained, ascertained) or future goods (to be manufactured or acquired of the seller after contract is done).

Specific goods: Goods that are identified and agreed upon
e.g. Mercedes, coal in backyard

Unascertain: Sale of Goods Act does not define this but it means goods which the parties have not identified as the subject of the contract.
e.g. A agrees to sell B “a new car”

Ascertain: when the parties enter a contract for the sale of unascertained goods and later the goods are separated and agreed upon, these goods become appropriate to the contract  ascertain goods

 Studyguide section 15, 16, 17; Reading 7 p.50

It is important to know these classifications for the purpose of deciding the exact time when ownership of the goods passes from the seller to the buyer.
Why do we have to know the exact time then ownership title passes?
1. Because the risks in the goods usually passes to the buyer when ownership passes to him unless the parties agree differently.
2. Only the person who has ownership can sell/transfer to a third party. Under Sale of Goods Act to work out when ownership passes to the buyer we need to know the type of classification of goods and the rules under the act.

-Specific and ascertained goods
With this type of goods property or ownership passes at such time as the parties intended to pass. p.487
The act provides five rules to help us decide the intention of the parties (p.488-9). Note also rule five unascertained or future goods, ownership in the case of such goods will pass when the goods become ascertain i.e. when they become appropriated to the contract (identified or agreed upon). This can happen when the seller delivers the goods to either himself or a carrier who will deliver to the buyer. Warders Import § 7020

The general rule: risk passes with ownership.
Two exemptions:
1. Delayed delivery, party responsible for delay bears the risk
2. p.490 (Allied Mills)

- Delivery and acceptance of goods –
§ 7025
Under Sale of Goods Act the seller must deliver the goods and the buyer must accept and pay. For delivery this means the voluntary transfer of possession from one person to another. This can happen even tough title has not passed and does not require actual physical handling of the goods. Sale of Goods Act sets out five rules regarding delivery.

- Acceptance of goods –
Acceptance occurs in certain circumstances (and only after the buyer has had a reasonable opportunity to examine the goods.

§ 7035 Implied terms for sale of goods.
Although the parties to a contract can in general make their own terms, Sale of Goods Act provides that source terms called conditions/warranties will be automatically included in every contract for a sale of goods even where the contract does not mention that condition. Furthermore, if the sale is a consumer sale under Sale of Goods Act these implied terms cannot be excluded in NSW. There are five implied conditions and two implied warranties.

- Consumer sale –
Defined in Sale of Goods Act as a sale in which goods are sold by a seller in the course of a business and the goods are of the kind usually bought for private use and sold to a person, not for use in a business. In such sale s 18-20 cannot be excluded in NSW. (TPA s 69)

Conditions/warranties under Sale of Goods Act p.500 (TPA s 70)
If the goods are sold by description as well as sample, then they must correspond with both.
What is a sale by description?
Applies where a buyer has seen the goods, where goods are described on a package, label, in contract but also includes where the purchaser has not seen the goods and relies simply on advertisement or even where goods do not exist but the buyer relies on description.
Bill v Taylor §7060 (reading 7, p. 52)

- Implied condition of fitness (TPA 71:2, Sale of Goods Act 19:1)
There are three pre-requisites for this condition to apply;
1. Did the buyer tell the seller by words or by implication the purpose that the goods are required for? Note: Not required if the goods only has one purpose e.g. milk.
2. Did the buyer rely on the seller’s skill and judgement? Note: The seller does not have to be an expert and the court usually assumes reliance where there is a sale of goods by a retailer, wholesaler or manufacturer (reading 7 p.52)

p.502 Grant v Australian Nitting Mills
 Reliance is proved if it appears that the buyer was trusting to a substantial extent on a promise or the skill or judgement of the retailer, and a similar observation was made in the case of Ashington Piggeries. Note: If however the buyer orders something from a seller with a specific or patent name it is assumed he is not relying on the seller’s skill or judgement and s 19:1 will not apply.

3. Are the goods of a kind which are supplied in the course of the business?

- Implied condition of merchantable quality (TPA s 19:2)
The Sale of Goods Act does not define merchantable quality (but see s 66, 70:1 in TPA which deals with merchantable quality).
To succeed under this section it must be shown:
1. The sale was a sale by description
2. The seller is a seller who deals in the goods of that description.

So, what does merchantable quality mean?
It looks like we need to look at the price and type of goods and purpose and ask what would a reasonable person expect from such goods.

TPA 1974
This is commonwealth legislation and although there is no specific power given to the federal parliament to make laws for consumers federal parliament has used several of its other powers together in such a way to enable it to make laws to protect and benefit consumers. However because of the limitations under the constitution the consumer protection previsions in TPA will mainly benefit consumers who deal with corporations or companies although parliament has tried very hard to make these laws apply to natural persons of it is constitutional possible to do this  By operation of s 6 an individual or natural person dealing with a consumer can be caught by the act in certain circumstances, such as for example in a commercial transaction where the conduct of the individual involves the use of the post, telegram, phone or advertising on radio and TV.

- Consumer protection under TPA
TPA in part 5 div 2 provides conditions and warranties into contracts for both the sale of goods and services, in addition the act also provides remedies for unfair practices against consumers.
It is important to understand that certain provisions of TPA, especially those relating to suppliers and manufacturers will only apply to a consumer as defined in s 4B (§7012).
Have a look at §7035, 7080 and p 54 studieguide).
For relevant sections in TPA which implies terms into consumer contracts  p 54,55 studieguide. Further protection is given to consumers under parts 4A and 5 in TPA.
Part 4A deals with unconscionable conduct where as part 5 deals with misleading and deceptive conduct and false/misleading representations.

Part 4A
Here the act provides remedies to try and balance the bargaining power between the consumer and supplier of goods and services. The provisions are concerned with unconscionable, grossly unfair conduct and although unconscionable is not defined, there are guidelines in the sections to help decide whether the conduct is uncounsiable.
S 51AB-51AE
See case studies p 59
Remedies for breach of this section entitles the consumer to damages under s 81, declaration s 87, correction (advertisement), refund etc.

- Misleading or deceptive conduct s 52 TPA
This section is a general prohibition which prohibits conduct by a corporation which is misleading or deceptive or likely to mislead or deceive.
The corresponding fair-trading s 42.
Basically under s 52 corporations engaged in business are required to tell the truth and make sure they do not give untrue information or fail to give information. There is no need to prove that the conduct is deliberate or intentional.
S 52 cannot be excluded by disclaimers or exclusion clauses.
Remedy for breaching s 52 is civil remedies; no fines or prison i.e. no criminal conduct exists since the conduct does not have to be deliberate. The remedies for breach of s 52 is damages, corrective advertisement, injunction (court orders) and any person or entity can apply under the act for a remedy under s 52.

- The meaning of conduct
Conduct can include statements, including opinions or even silence. Giving false warranties is also misleading/deceptive conduct under s 52. See cases §7250
Taco Bell
Parkdale
McWilliams

- Trade or commerce
Taco Bell
Pacific Dunlop § 7280
P. 551
These cases set down tests to decided whether the conduct is misleading and in Taco Bell’s case the federal court suggested the following approach;
What would be the effect of the conduct on this target group/person, taken into account intelligent/not so intelligent people, was the conduct misleading?
If the only effect of the conduct on this target group was to cause confusion, there would be no breach under s 52.

- PROPERTY LAW -

Definition of property:
1. “thing” can be owned”
2. ownership/title

- Classification of property –
- Real property
o Land
o Fixtures

- Personal property
o Chooses in action (intangible; debt, copyright)
o Chooses in possession (tangible; book, car

- Title vs. possession –
A person can own property without possessing it and a person can possess property without owning it. The owner of property can exercise legal rights over property which a person in possession who does not have ownership cannot exercise. Never the less a person in possession has rights that are protected under the law, in fact we say that possession is 9/10 of the law because possession is good against the whole world except the true owner. § 3060 Armory v Delamirie

- Acquisition of personal property by finding –
When personal property is found, it is important to be aware of where the goods are found and the circumstances surrounding the findings.
1. Articles found in or attached to land
Generally speaking, these articles will belong to the owner of the land even if the owner does not know of their existence.
2. Articles found on land, but not attached to land

We have to decide who has the better right, the owner/lawful possessor or the person who finds the article.
Under the law, the owner or lawful possessor has better title but only if it can be shown that he/she exercised complete control over the land so that it is clear that this control extends to everything on the land as well. If this degree of control is missing, then the finder will have better title, assuming that the true owner of the article is not found.
§3060 Bridges v Hawkesworth
Parker v British Airways Board (not in book)

The test is; did the owner or lawful possessor exercise such a degree of control over the land so as to indicate an intention to control the land and anything that might be found on it?
If yes: they will be entitled to anything found on the land.
If no: the finder will be entitled.

- Articles found in the course of employment –
There is a presumption that an employer is the owner of any goods found by an employee in the course of employment.
Ranger v Griffin (not in book)
NCA v Flack §3060

- Concepts of real property and ownership –
Under the (extent of real property) common law, ownership of land included airspace and everything below the surface down to the centre of the earth. Nowadays however various legislation has been introduced which has the effect of limiting an owner’s rights to his land.
For example; although the common law states rights of ownership below soil level, the government has reserved the rights to all minerals under the surface of the land. As for ownership of airspace as is necessary to allow reasonable use and enjoyment of the property i.e. to carry out the usual activities appropriate to the land.
§ 3150 Bernstein v Skyviews
- Land and fixtures –
We say that the owner of land also owns the fixtures on the land. A fixture is a chattel (an item of personal property, which because of its attachment or fixation to land becomes part of the land and in effect changes from personal property to real property).
e.g. a house is a fixture, so also a tree, light thing may or not be a fixture (also statue in garden etc.).
Why is it important to know if something is or is not a fixture?
There are several reasons, but one good example is a situation where an owner of land has a house that he wants to sell. The land has a pool, a shed, and an antique fence and in the house is an electrical stove, carpets, windows etc. If the owner is selling i.e. his land, which of these items is included in the sale? What is the purchaser actually buying? Under the common law, land includes fixtures and unless there is an expressed agreement to the contrary, any fixtures will be sold as land. This raises the question of which items are in fact fixtures and sometimes such a dispute arises either because the owner selling the property is arguing that certain items are chattels and therefore not included in the price or because the items are or have become fixtures and are therefore included in the sale. It is obvious from the cases that it is not always easy to decide whether it’s a chattel/fixture or a chattel that has become a fixture?
To decide the question the court uses some general tests and they look at the intention of the person who placed the chattel. To work out this intention, the court looks at the surrounding circumstances;

1. They look to see: does the chattel stand on its own weight or does it have to be fixed to the land?
2. The degree of fixation? (how is it attached)
3. How much damage would be done if the chattel was removed?
Most importantly, each case must be decided on its own facts;
§3080, p69 study guide APA v Coroneo (not in text)

- Real property – ownership of land –
-
§ 3160 Joint tenancies
A person can own real property as a sole proprietor or as a co-owner with other people. There are two kinds of co-ownership;
1. Joint tenancy
2. Tenancies in common

§ 3180 Joint tenancy
Although joint tenancy has separate legal rights between themselves they own in the position of a single owner against third parties. Joint tenancy is characterised by four “unities”.
- interest
- possession
- time
- title
Joint tenancies will come to an end if one of these unities is destroyed. Can be ended (severed) in various ways.

§3190 Tenancy in common
Characterized by undivided share, but a separate interest although the actual land remains undivided. Shares can be equal/unequal.
Each tenant in common can sell, mortgage, device(will) their own share in the property. There is no automatic right of ownership like in joint tenancy. Tenancy in common can be terminated by sale, participation or buying out.

§3330 Torrens title
§3370 Old system title land

§3440 Change of ownership
- sale
- gift
- inheritance under a will
-assignment by deed
- declaration of trust
§3450 To buy real estate

- Intellectual property
Intellectual property is personal property, chooses in action, intangible

§3480 , Studyguide p.77 Copyright
Is a protection for works that has its origin of expressive writer, composer, artist or other creative individual. And it gives that individual to copy that particular for of expression as well as other associated rights. Regulated by the Copyright Act 1968 (Cth) and case law under the act.

And s 31 under the act sets out the nature of the copyright and its exclusive rights that are attached to it. Copyright attaches to literary, dramatic, musical, artistic works and this now includes sound recordings, film, tv, radio/computer programs.
Copyright only applies to original works, i.e. the result of the owners own effort, not a copy from someone else although it does not have to be unique. Copyrights covers both published and unpublished work, however it comes into existence under publication, meaning that a copy of the work has been supplied to the public. Copyright exists in a published original if the first publication of the work made available to the public in Australia or if the author was an Australian citizen or a protected person/resident.

Key points
- Copyright belongs to the person who converts the idea in a finished work
- If the same information is set out in a different way, there is no breach of copyright
- Ideas themselves are not protected by copyrights, it has to be reduced to writings or some material forms.

Who is the owner?
The author. Unless, the work is produced in the course of employment.

How long does copyright last?
Litery, dramatic works: generally 50 years from the death of the author, and other works also generally 50 years.

Infringe copyright
This occurs if a person reproduces the whole/part of copyrighted works without the consent of the owner. However, there is no infringement if authorized by the copyright owner or it is in the public interest.
Basically, in general, reproduction or copying for private use will not breach copyright. But this depends on the meaning of private use which is to be decided on the particular circumstances.

Breach
Is an offence under the Act.

- Civil remedy
o Injunction (court order)
o Damages (money compensation including loss of profits)
(damages awarded are rewarded to compensate the author for loss suffered through infringement)

Defences to an action of infringement.

- Designs  Designs Act 1966 (Cth) Studyguide p.74
Section 4 of the Act defines ”design” i.e. design relates to the appearance of an article, not the article itself or how it is made. The artistic nature of some design enables them to be protected under Copyright and Designs Act.

Registering
It is necessary to register a design under s 17 to get protection. The design must be new or original and met certain criteria under the Act. Once registered it is open to the public for inspection, registration is effective for 1 year from date of application. However, the owner can apply for further protective periods to a maximum of 16years.

Infringement
An imitation of the design or use or fraudulent import for commercial use is an infringement of the rights of the owner of the design. In addition, it is an infringement to sell/hire/offer for sale any article imitating the design.

Remedies
- injunction
- damages
- loss of profit

Patent (p. 73)
Is an invention, regulated under Patents Act 1990.
A patent is total right given to the inventor, the exclusive right to exploit the invention for a certain period or authorize another person to do so.

Invention can mean something new, basically new and it must be something not used or known publicly, meaning it can be either;
1. new product/substance
2. machine
3. process to be used for making something etc

However it cannot be ideas/theories on their own since these are not useful. Also if the inventor manufactures/sells the invention before applying for patent it will not be patentable.

Infringement
Civil remedies (same as copyright and design).

- Trade marks  Trade Marks Act 1995 (Cth) p.78-79
A trademark is a distinctive identification mark or symbol connecting with a particular product/service. It is defined as a sign/symbol to distinguish you, like a signature.

There is statutory as well as common law rules. Trademarks are protected by legislation. Trademarks can be rejected for registration if it contains scandalous matter or if it cannot be presented graphically. Or if the applicant is not the owner of the trademark.
Registration/protection runs for 10 years and can be renewed indefinitely.

Infringement
Same as copyright, design and patent.

The common law rules about “passing off” ( tort) can also apply to an infringement of trademarks as well as deceptive conduct.

- TORTS chapter 4, reading 9, 10, 11, 12 -
Contracts  Civil law
Torts  Civil law
Crime  Criminal law

A tort is defined as a civil wrong. It is an act which causes harm (loss/injury/damage) to a person/property and which is against the law. A tort can be 1. intentional, 2. unintentional e.g. trespass, assault, battery (1)
e.g. negligence (2)

A tort can be a failure to act according to a legal duty or a violation of another party’s rights. A tort is different from crime because a tort is wrong against an individual, where as a crime is wrong against society. Sometimes a wrong can be both crime and tort e.g. assault. (A assaults B, A can be prosecuted by the state for criminal assault and in addition A can be sued by B in a civil action for damage for the tort of assault).
Assault  threaten battery  to actually do it

In this course we focus on the tort of negligence.

Torts of negligence § 1350
This tort is classified as unintentional and the basis is the absence of reasonable conduct i.e. negligence is concerned with the area of law which imposes a duty on a person to take reasonable care, not to cause harm to another person.
Donaghue v Stevenson (snail in a bottle)

D v S is an important precedent which establishes the action of negligence as an independent tort. However, it is important to realise that not every act of careless behaviour will be actionable in negligence and the defendant will only be liable if the plaintiff can prove the four elements;

1. That D owed him a duty of care
2. That D breached his duty of care
3. Causation; that D’s breach caused P’s damages/loss
4. Remoteness; The damage was predictable, not too remote (far removed from the breached)

§4080 Element 1: Duty of care
This duty was explained by Lord Atkin in D v S. In this case the court accepted that the D owed the P a duty of care. Since that case it is established that in order to determine whether the D owed the P a duty of care in any particular case, the court will look at the test of reasonable forseeability of harm-test. And this test is about recognizing the possibility of loss or injury.
Shuey’s case (lady slips on veggie on floor, sues shop for negligence).

Other factors relating to the existence of Duty of care § 4080 p.221
1. Proximity - here meaning closeness
The test of reasonable forseeability is an objective test where the court asks whether a reasonable person in the D’s position would have foreseen that harm or loss would follow from the action or inaction.
Proximity can be physical e.g. careless driving which cause damage to a person/property.
- Circumstantial : e.g. doctor-patient, financial advisor- client
- Causal: clear connection between what the D did or did not do and the injury to P but the connection is not necessarily of a physical/circumstantional nature
Jaensh v Coffey
2. Reasonable reliance
3. Vulnerability of a P to the D’s action §4090

Economic advice §4090

Element 2  Breach of Duty of care
Once it is established that a duty of care exists the P must show that the D breached his duty of care. And to decide this is so, the court asks the following;
Assuming that the risk of injury to the P was reasonably foreseeable, how would a reasonably prudent (wise) person in the D’s position have acted in similar circumstances? I.e. what would a reasonable person have done about the risk?
Did he exercise a reasonable degree or standard of care?
Here the law demands a reasonable degree or standard of care from the D. What is reasonable can vary depending on the circumstances of the case

e.g. Bolton v Stone §4100
In this case the court considered probability of risk and decided that the owners of then cricket ground did not breach their duty of care by not eliminating the risk of a cricket ball being battered out of the stadium and hitting someone.

Another case Paris v Stepney the court considered the gravity of harm.

Element 3  Causation
This is about showing that the damage was caused by the breach. Here the court uses the “But for…”-test. They ask: would the loss have occurred but for (if it was not for) the negligence of the D?
Under this test the court looks at the facts to decide whether the negligence really caused the loss? I.e. they look for a causal link between the negligence and the loss and if this is not present the P will lose the case. Similarly, if there is an intervening cause or several causes for the loss the causal link may be broken making it difficult to use the but for-test. If this is the case, the court may prefer to adopt a common sense-approach.

E.g. Yates v Jones §4130
March v Stramare

Element 4  Remoteness
Even if P establishes the first three elements, he cannot win the case if the damage caused was not reasonable foreseeable.
Wagon x 2 cases
Defence
1. Contributory negligence (partly defence, reduces D’s damages)
2. Voluntary negligence (assumption of risk “volenti non injuria”, complete defence)

- Contributory – §4160
- partly defence pleaded by the D
- D must show that P failed to take reasonable care to avoid a foreseeable risk of injury

- Voluntary assumption of risk - §4171
- Although this is an complete defence it is not easy to prove at common law. Traditionally it has been applied in cases of sport/games involving a risk.
- The defence only applies where:
 The P fully accepted the risk of injury
 The P accepted it willingly

Professional negligence
The law now recognises that a P should be able to recover for financial loss even where the loss is not associated with physical injury or damage i.e. a P can now claim for pure economic loss and this was established in the case of
Hedley §4240, 4215-4220
p. 258 test, p. 263 test
READINGS!!!

An English case which was approved in Australian High Court MLC v Evatt and the later case of Shaddock v Parramatta where the court misstated its willingness to consider liability for economic loss arising from negligent misstatement. In Shaddock’s case the High Court held that in such a case to establish that a duty of care exists, the following must be proved:
1. A person gives information/advice to another person
2. On a serious matter
3. In circumstances where the advisor realises or should realise
4. That he/she is being trusted/relied on to give them the best information/advice
5. As a basis for action by the other person
6. And it is reasonable for the other person to rely on that advice
If the above factors exists the court would say that in a case of pure economic loss due to negligent misstatement, the P has to prove the first element of the tort of negligence i.e. that the person that made the statement/gave the advice owed him a duty of care.
Once the P has established all that, he is still required to prove the existence of the other three elements of negligence.

Liability of auditors
The real question here is to whom does the auditor owe a duty of care? I.e. when can we say the duty of care exists, is it limited to the client for whom the auditor prepared the accounts for or does the duty of care extend to any person who relies on the statement/advice contained in the auditor’s report?
Esander Finance v Pete p.269
In this case it is said that for a duty of care to exist between auditor and third party it is not enough for the mere forseeability of the possibility that their report might be communicated and that anyone to whom it is communicated might enter into some kind of transaction and as a result, suffer financial loss. It would seem that an auditor’s duty of care applies to;
1. the immediate client/user for whom the account was prepared
2. To third parties but only where the third party can show that the auditor made the statement with the intention to induce someone to act on it i.e. forseeability as proximity is required.

Esander lost the case because they did not raise proximity i.e. the existence of the relationship is proximity.
See Duty of care to third parties p.263, 269
Rentokil v Channan
In this case loss was caused by negligent misstatement in a written report made by a pest control company who stated the house was termite-free.

ALTERNATIVE DISPUTE RESOLUTION (ADR) §1441
In Australia there is an adversial (enemy) system, meaning that the fights happens in court, no where else.



Non adjucative process for dispute resolution
§1442
Mediation is a structured process in which a neutral third party helps the parties to negotiate their own resolution by helping them to systematically isolate the issues in dispute, to develop options on how to resolve the issues, and to reach an agreement that accommodates the needs for the parties. This agreement is not legally binding, however the parties normally draw up the agreement into a binding contract with help and advice from their professional advisors such as their lawyer or accountant.
Mediation is a voluntary process and the parties can withdraw from the process at anytime. Basically it is the parties that control the content and outcome, while the mediator controls the process.
The process itself is formal and the parties can, if they wish, have a lawyer or another person represent them.
Advantages:
- quicker (weeks or months)
- cheaper (no legal fees…)
- less time missed at work
- informal (no rules of procedure, evidence…)
- each party can contribute
- enhances business relationships (less resentment in future)
- wider remedies (more available solutions)
- confidentiality

Formal dispute resolution
e.g. commercial arbitration

Here we are not referring to industrial arbitration, we are talking about private/commercial arbitration. This is a private process involving a third party acting as a judge to hear the dispute and make a determination which is binding on the parties.
Arbitration is similar to litigation in that the process is adversial and adjucative. The arbitrator has to listen to the evidence, must follow the rules of natural justice;
1. listen to the other party
2. deliver a legally binding decision

- CRIME reading 13,14 § 2010
Civil law: contract law, torts, property, succession, banking
Criminal law: larceny, murder, drug offences
CRIMINAL LAW
Criminal law is public law, where the state takes action against the individual; where as private law is an action between two parties who are individuals or ordinary citizens.

Sources of criminal law
Criminal law is coming from both the Common law and Statute law. In NSW a court applies the rules of both to decide criminal cases. Some states, however, for example Queensland, have a criminal code under which they have codified the law related to crime. This means that all the legal rules (both common and statute) have been collected and restated by Parliamnet in one act called “Criminal Code” and this code replaces the common law rules.

Civil law vs. Criminal law
Criminal and civil law are different in some important aspects; this is concerned with the rights and obligations of individuals , e.g. rights under the contracts; if the contract is breached, legal action for breach of the contract is brought by one individual against another for legal remedy, such as damages. In a civil matter, the party bringing legal action to court is called plaintiff and the party being sued is called defendant.
In a civil case it is the plaintiff who has to prove his case, we call this responsibility ‘burden of proof’ (onus of proof) and in civil cases the standard of proof, i.e. the amount of truth required to win the case is on the balance of probabilities. Whichever party loses the case, the loser may be able to appeal to a higher court, the person appealing is called appellant and another party is respondent. In civil cases the law provides civil remedies, such as damages and specific performance.

Criminal law contains a public element because it is concerned with protecting society against harm/damages and specified anti-social behaviour. In criminal cases the purpose of the action is to punish and deter unlike civil actions, which aim is to compensate party for loss. In criminal cases, legal action is taken by the prosecution (Crown) on behalf of the society, if the law considers that a crime has been committed. The defendant in the serious criminal cases is referred to be accused.

The names of criminal cases are written as R v ….

Since the Crown is commencing the legal action, it has a burden/onus of proof on prosecution; and the standard of proof in the criminal case is much higher than in a civil case. The standard in the criminal case is beyond the reasonable doubt. In criminal cases the victim is represented by the State prosecutor at the expense of the state. The accused person can choose to be represented by a lawyer and be liable to met the expense, unless he/she is entitled to legal aid. If the guilt of the accused has been established, criminal sanctions will be imposed by the court and criminal penalties consist of fines or imprisonment.

Criminal procedure and classification of criminal offences
It refers to the steps that have to be taken to bring the person to court and the procedure after. This can depend on how the offence which is alleged to have been committed is classified.

Classification of criminal offences
1. Summary offences
i. Less serious in nature with smaller penalities
ii. Question of law and fact are dealt with summarily by a magistrate (no jury)
iii. Many are offences of strict liability where the prosecution should be proved
2. individual offences §2050
i. divided into major indictable offences (prosecuted by the Crown and tried with judge and jury)
ii. minor indictable offences (prosecuted by the police and tried summarily in Magistrate’s court)
iii. serious offences (murder) and major property offences are tried in the the Supreme court before judge and jury.

There are two main ways, in which a person can be brought to court for committing a criminal offence;
1. by arrest and charge
2. by summers

Who can commit crime? §2210
Children
Corporation
Public officers

Procedure after charge
At the first court appears a matter is usually adjourned (postphoned to a later date), the accused will be remained in custody unless it has been granted bail.

Bail
It is the realisation of an accused person from custody to appear at court at a later date. Bail is usually grounded unless the offence is a really serious one (murder) or there are good reasons to not be grounded.

Preliminary investiagion/committal §2130
Court hearing the trial. Once a case has been through the committal stage, it goes to trial in a Higher court (distinct or supreme court) where a Crown prosecutor presents the indictment to the court (reads the charges).
The defence must now advice a ‘plea’; guilty or not guilty.
If the plea is guilty, punishment or sentence will be imposed  the end of the case.
If the plea is not guily, then trial commences.
Prosecutor calls the witness. §2180

- Criminal liability –
When we speak of criminal liability or the elements necessary for criminal liability, this refers to those things that the prosecution has to prove to the jury before the jury can find the accused guilty of the crime/offence. The elements of a crime are the “actus reus” and “mens reus”.

- Actus Reus
-An action or conduct (or inaction if action is required)
- The act must be voluntary
- The act must have caused the result i.e. was the substantial/operating cause. This is causation.

- Mens Rea
o Mental element (guilty mind)
o Intention to cause the result (of the conduct) unless the result is caused recklessly.

Cases where mens rea is not required:
- strict liability offences
- absolute liability

§2240 White Collar Crime
There is no part of criminal law which can be recognized separately as white collar crime, rath

Globalisation 9 of 10 on the basis of 4210 Review.