Commlaw 1004 : Commercial Assessment Answer

Internal Code – MAS1624

Law Assignment

Question 1:

In March 2016, in response to an advertisement, Ryan went to MG’s Fitness Centre and inspected the premises. During that visit Ryan was persuaded to sign an annual membership which cost him $450 and for which he is able to
use any of the equipment at MG’s Fitness Centre as often as he wants during the next 12 months. One evening in July, after work, he was bench pressing some weights at the fitness centre when the bench he was leaning on
collapsed and as a result Ryan was badly injured when the weights fell onto his leg. Inspection revealed that the bench was unsafe as a result of a failure by the Fitness Centre to maintain it properly largely due to the Fitness Centre buying cheap badly worn equipment and benches to save costs. MG’s Fitness Centre deny any liability and are seeking to rely on the following clause in the signed agreement that Ryan signed in March 2016.

You are required to advise Ryan and MG’s Fitness Centre of their legal rights and obligations in regard to this dispute. In your answer consider separately the position under first the common law and then second also under the
Australian Consumer Law.

Question 2:

Bob was 84 years old and had been a farmer all his life. Tom was his nephew and Bob liked Tom very much as Tom reminded Bob of what he was like when he was younger.
One evening after Tom had done some work on Bob’s farm, Tom asked Bob what he was planning to do with the farm after he was no longer here. Bob said he wasn’t sure but that he would like to keep the farm “in the family”. Tom immediately replied saying he would like to own it one day but that as he had just lost his fulltime job he did not think he could ever afford it. Bob decided there and then and he said “well look, I think you can have the farm and we can talk price later”.
The next day Tom went to his lawyer friend, Marvin, and told him to prepare a sale of land contract with the price for the sale of the land being $150,000 and for settlement to be “one month after Tom goes to live in a nursing home”. Tom told Marvin, “it’s okay as Bob said he wants me to have the farm”. The very next day Tom brings Marvin with him to Bob’s farm and mentions their discussion about the sale of the farm the other day and whether Bob was serious about what he said (meaning did Bob really want Tom to have the farm)? Bob said yes he wanted the farm to stay in the family as long as he was taken care of. Thereupon Tom handed Bob the sale contract for the farm and said to Bob, “don’t worry about anything as you know Marvin, as he is your lawyer also, and he prepared everything”. Bob didn’t think to ask what price was mentioned for the sale as he trusted his nephew and Marvin and so Bob signed the sale of land contract along with Tom and Marvin signed as a witness. Marvin did not suggest that Bob receive any further independent legal advice.Six months later Tom is admitted to full-time care in the local nursing home as
his arthritis and dementia have now deteriorated so much so that he can no longer live on the farm.A month after this time Tom seizes his moment and transfers $150,000 to Bob’s bank account and the bank, with some reluctance, hands over to Tom theCertificate of Title of the farm land making Tom the new legal owner of this farm land.

Based only on common law principles you are required to advise the two daughters (Kath and Kim) and the nephew (Tom) as to whether or not this transfer of the farm land can be legally challenged and if so on what grounds.

Question 3 :

Frank is a builder and he has agreed in a signed written contract to undertake some renovation work for Mr. Smithers. The agreed fee for the completion of the work is $50,000. Frank knows that Mr. Smithers rents out the house and that the renovations are being carried out in order to attract better tenants to the rental house.
After starting the work, Frank realises that he underquoted on this job as he failed to take into account the recent increase in the price of building materials. As he now realises that he will now make only a very small profit on
this job (or perhaps even a small loss) he advises Mr. Smithers that he will not undertake any further work on this rental property owned by Mr. Smithers unless Mr. Smithers pays him a further $10,000 (on top of the $50,000 already agreed to be paid for this job).
Mr. Smithers is desperate to get the work done as he knows that he cannot rent the rental property in its present condition since Frank has already started the renovation work and as a result some walls have already been partially
knocked down and there is also rubble strewn throughout the house.Reluctantly Mr. Smithers signs a new written contract to agree to pay Frank this additional $10,000. Immediately after the work is completed Mr. Smithers advises Frank that he will not be paying him the additional $10,000.
Advise both Frank and Mr. Smithers about their legal rights in connection with the payment of this additional $10,000.