Business Law Warranty Clause Matter

Question: Discuss about the Business Law for Warranty Clause Matter. Answer: 1. The issue in the first part is that whether there lays any contract between Vanessa and Nikhil Car Sales Pty Ltd or not. There are certain essential elements that determine the presence of a contract between two parties. There should be an offer made by one party and the same offer should be accepted on the expressed terms unaltered by the other party in the first place. This presence ofoffer and acceptance is one of the first steps of building a contract[1]. It should be stated in this matter that Nikhil Car sales had come up with the advertisement for the sale of used cars in the newspapers. This shows that Nikhil Car Sales had given an invitation to treat and this was taken as against an offer by Vanessa. She opted to buy one of the cars and thus the offer commenced. The second essential of forming a contract is the presence of consideration. In the given matter, the money offered by Vanessa that is $9,500 is the consideration. Thus, it can be said that the essential elements of f orming a contract have been satisfied between the two of them. Moreover, there are certain other conditions as well which should be validated before a contract is enforced. The parties to the contract should have mutual consent in the matter[2]. This implies that both the parties to the contract should agree to the terms of the contract and none of the parties should be in a preferential situation over the other. In the given instance both Nikhil and Vanessa had consent in the matter and agreed to the terms that were mutually consented by each one of them. Competence of the parties to enter into the contract is another aspect that needs to be looked into. This implies that the parties in the contract should have the legal validity to enter into the contract. They should be of proper age and should not have any legal incompetence to enter into the contract. In the given situation, there is nothing which points that either Nikhil or Vanessa were legally incompetent to enter into the contract. Hence, it is proved beyond any reasonable doubt that al l the elements of a valid contract are present in the matter and hence there exists a valid contract between Vanessa and Nikhil Car Sales Pty Ltd. There is however absence of any warranty clause in the matter. But this cannot invalidate the contract because the presence of a warranty clause in every contract is not mandatory and it can remain absent in certain contracts[3]. If both the parties were aware of the absence of the warranty clause in the contract , and raised no objection as far as the validity of the contract is in question, then the absence of the clause does not let the entire contract to be invalidated. The absence of the warranty clause would not affect the nature of the contract and the agreement entered into by Nikhil and Vanessa would remain in effect[4]. 2. As far as common law is concerned, it can be said that negligence in the matter has been conducted by Nikhil in the matter and Vanessa has rights to claim for compensation of the negligence caused towards her. The principle behind negligence is that the party that complains of should owe to the other party complaining a duty to take care and the party that complains should be able to prove that the damage that he has suffered is a consequence of that breach of duty[5]. Thus, it can be said that there are certain essentials of negligence namely the wrongdoer owed a duty of care and that duty was breached by him[6]. However, had there been another reasonable person on that position, the beach would have been avoided. Subsequently, the loss that was suffered by the plaintiff should be a result of the breach of duty of care owed by the defendant in any matter[7]. The duty however is not any ordinary duty or a moral obligation. It is a legal duty to take care breaching which might result in a liability for paying damages[8]. In the given situation, Nikhil was aware that Vanessa was relying on him for making the decision about buying the care. In spite of being aware he chose to give her false representations. He deviated from his professional duty of stating the truth about the previous ownership of the car as well as the actual odometer running of the car. This indicates his failure in any position to comply with his duty of care. Thus, it can be said that the initial two essentials have been satisfied by Nikhil that establish his negligence in the matter. It is also beyond reasonable doubt that Vanessa did suffer damage because of the negligence of Nikhil. The back gear of the car was not working within three months of her purchasing the car. She also said that she had no intentions to buy the car if she was made aware of the actual condition of the vehicle. However, she ended up buying the same only because she was falsely represented with the facts about the car. Hence it can be conclusively said on this aspect that the loss suffered by Vanessa is only because of the negligence of Nikhil. Thus, negligence in the matter is proved beyond any reasonable doubts. However, it should also be noted that Vanessa contributed towards the negligence which happens to be a valid defense against the accusation towards Nikhil. It has been well established that Vanessa had options of checking about the whereabouts of the car. Moreover, the hand book was placed right inside the car which contained all the details about the car. In spite of this, Vanessa blindly relied on the representations made by Nikhil and executed the purchase. This indicates that Vanessa had contributed towards the negligence. Hence, as far as common law is in question, there are no remedies that Vanessa has in the matter. 3. In the given matter, when Vanessa went to examine the car, she was told and shown that the car had a single previous owner and it had only run for 75,000 kilometers. However, in fact, the car was owned by a company previously and it was a fleet car. Moreover, it had actually run for 175,000 kilometers. However, it should also be noted that inside the car, there was a service book of the car and it contained all the details of the car and its operations. The service book was not hidden from Vanessa and she was allowed to examine the car fully. On the other hand, Nikhil himself told Vanessa that the car was the best one out of the lot and had only one owner previously. The odometer of the car also reflected the reading that was communicated by Nikhil. Vanessa came to know about the true condition of the car from her mechanic. It can be said that Vanessa does have rights under the common law. The conduct of Nikhil can be said to be a misleading and deceptive conduct. Section 18(1) of th e ACL prohibits a person from entering into any misleading or deceptive conduct in his business[9]. The preconditions in this regard are that the defendant should be a person and should be engaged in some trade or commerce. He should subsequently have engaged in a conduct that is misleading or deceptive. Deceiving is said to have been done when a person is made to believe something that is false or would have led to an error in thoughts. Misleading is said to have been done when the person is led astray in action. A breach under Section 18 of the ACL gives civil consequences in the hands of the plaintiff. Opinions expressed also constitute a breach under this section[10]. Where the opinion is believed to be true by the other party and the opinion turns out to be actually a false one given intentionally, then such an instance is taken to be a breach under the law and the plaintiff becomes entitled to receive remedies[11]. In the given situation, though Vanessa had the opportunity of checking all the details about the car, yet the fact cannot be overlooked that she was deceived. The wrongful odometer reading was shown to her and there is no justification to this. Moreover, it was also told to her that the car had a single owner. This statement is partially true because the car was a fleet car and belonged to a company. Thus, these constituted puff statements made to deceive her[12]. Moreover, an opinion was also expressed by Nikhil regarding the car that he felt it was the best. Hence, it can be said that all these were done only to execute the sale and deceive Vanessa. Thus, Vanessa can not only claim for damages under Section 236 but also can ask for compensatory orders under Division 4 of the ACL. References Cheshire, G. C, C. H. S Fifoot and M. P Furmston,Cheshire And Fifoot's Law Of Contract(Butterworths, 2009) Corones, S. G,The Australian Consumer Law(Thomson Reuters (Professional) Australia, 2011) Miller, Russell V,Miller's Australian Competition And Consumer Law Annotated(Thomson Reuters (Professional) Australia, 2011) Turner, C. F,Australian Commercial Law(LBC Information Services, 2001) (Bolam v Friern Hospital Management Committee(1957) 1 WLR Donoghue v Stevenson[1932] AC Hedley Byrne Co Ltd v Heller[1964] AC Multiplex Constructions Pty Ltd v Amdel Ltd[1991] ATPR Walker Corporation Pty Limited v Sydney Harbour Foreshore Authority[2008] HCA Weitman v Katies(1977) 2 TPC