商法导论case study

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Case Study 1

Samir is walking down Princes Street one Saturday morning when he notices a very eye-catching display of sets of golf clubs in the window of Fairways, a well-known Edinburgh sports retailer. As Samir is a very keen golfer, he stops to pay more attention to the window display. Samir immediately notices that a set of golf clubs (by Japanese master craftsman Matsumoto) is priced at an incredible £150. He is astonished at the low price for the golf clubs and he immediately rushes into the shop where he heads straight for the cash desk so that he can purchase the goods. On reaching the cash desk, Samir is incredibly annoyed to be told by the (somewhat superior) sales assistant that some sort of mistake has obviously occurred. There is no way that the store would sell a set of Matsumoto golf clubs for a mere £150. The goods have been incorrectly priced and if Samir wishes to purchase the clubs he must pay £1,500 for them. Samir insists that Fairways has made him a definite offer and that he has now accepted that offer — there is a legally enforceable contract between him and the store. The sales assistant is absolutely unimpressed by Samir s line of argument. Admittedly, it is often the case that Fairways will give customers goods which are wrongly priced for the price as it is marked on the ticket, but this

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is purely a gesture of goodwill. In this situation, the sales assistant is absolutely certain that her supervisor would be most unhappy if Samir was able to obtain the goods for the ridiculous price of £150. Samir begins to lose his temper and the other customers in the store are beginning to stop and stare at the disturbance. However, the sales assistant still refuses to sell the golf clubs to Samir for £150.

Question 1

Does Samir have a legally enforceable contract with Fairways for the purchase of the Matsumoto golf clubs for £150?

In support of the above answer, candidates should be able to cite at least one of the following decisions:

Carlill v Carbolic Smokeball Co [1893] Harvey v Facey [1893] Jaeger Brothers v J & A McMorland [1902] Fenwick v Macdonald, Fraser & Co Ltd [1904]

Pharmaceutical Society of Great Britain v Boots Cash Chemists

[1953] Fisher v Bell [1961]

On storming out of Fairways, Samir runs into an old friend, Susan, whom he agrees to meet for a meal at 7 o clock that evening at Shanghai Surprise restaurant. Susan rushes off to her favourite designer clothing store, Tiffany s Boutique, in order to purchase an outfit for her night out with Samir. Susan

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spends nearly a £1,000 on her outfit from Tiffany s. As things later turn out, Samir will conveniently forget that he made arrangements to go out with Susan that evening. Susan is now determined to sue him for the cost of her new outfit, her taxi and the disappointment caused.

Question2

What are the chances of Susan being successful if she goes

ahead and sues Samir for the cost of her new designer outfit, the cost of her taxi fare and the disappointment caused?

Jones v Vernon’s Pools [1938]

Robertson v Balfour [1938]

Spellman v Spellman [1961]

Ferguson v Littlewoods Pools Ltd [1997]

On arriving home just before lunch-time, Samir plays back his telephone answer machine and hears a message from Dougie Campbell, the builder withdrawing his earlier offer to build a conservatory and patio for £10,000. Samir had e-mailed his acceptance of Campbell s offer several days previously. However, unknown to Samir, he mistyped Campbell s e-mail address and his acceptance never arrived at its intended destination.

Question 3

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Is Dougie Campbell entitled to cancel its offer to build a conservatory and patio for Samir?

Verdin Brothers v Robertson [1871]

Entores Ltd v Miles Far Eastern Corpn [1955]

Brinkibon v Stahag Stahl [1982]

Later on Saturday afternoon, Samir receives a call on his mobile from Stuart who offers to sell him his car for £4,500. Samir is very anxious to purchase the car, but in response to the offer he says to Stuart I ll give you £4,000 for the car. Stuart refuses to bargain with Samir and tells him bluntly that the price is £4,500 if he wants the car. An hour later, Samir phones Stuart agreeing to pay £4,500, but he is somewhat shocked to be told by Stuart that he is no longer interested in dealing with him and that someone else is coming over to look at the car.

Question 4

Can Samir insist that Stuart sell the car to him for £4,500? Hyde v Wrench [1840]

Wolf & Wolf v Forfar Potato Co Ltd [1984]

Butler Machine Tool Co Ltd v Ex-Cell-O Corpn (England) Ltd

[1979]

Case Study 2

Robert, a sales person at Marvellous Motors, approaches

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Christine who is looking at a car sitting on the dealership s forecourt. Robert says to Christine: “You ve obviously got an eye for a bargain. Let me give you the vehicle s background. You re looking at a fantastic deal for a five year old car. The price is £3,999 and I think we re really going the extra mile here for our customers — excuse the pun I couldn t resist it! The car has only had one previous owner — an elderly lady, who kept it in immaculate condition. The previous owner was getting too old to drive and she had to get rid of the car. I can guarantee you that this is one of the best buys you will ever make!”

Christine is by now very interested in buying the car. It would appear from a reading of the milometer that the car has only covered 10,000 miles. After giving matters some thought, Christine decides to go ahead and purchase the car. After a mere four weeks of driving the car, however, the engine completely seizes up. Christine gets one of her friends, Jutinder, who is a motor mechanic to examine the car and he informs her that the engine has suffered irreparable damage as a result of being involved in a serious collision with another vehicle. Furthermore, Jutinder suspects that the mileage of the car is much higher — the true reading should, in his opinion, be somewhere in the region of 200,000 miles.

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Questions

1 How would you classify Robert s statement to Christine in relation to the condition of the car?

Attwood v Small [1838]

Erlanger v New Sombrero Phosphate Co [1878]

Smith v Chadwick [1884]

Derry v Peek [1889]

Boyd & Forrest v Glasgow & South-Western Railway Co [1915] Smith v Sim [1954]

Hedley Byrne & Co Ltd v Heller & Partners Ltd [1963]

2 What is the status of the contract between Christine and Marvellous Motors?

Attwood v Small [1838]

Erlanger v New Sombrero Phosphate Co [1878]

Smith v Chadwick [1884]

Derry v Peek [1889]

Boyd & Forrest v Glasgow & South-Western Railway Co [1915] 3 What legal remedies are available to Christine in this situation?

Erlanger v New Sombrero Phosphate Co [1878]

Boyd & Forrest v Glasgow & South-Western Railway Co [1915] Smith v Sim [1954]

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Case Study 3

Alasdair had entered a contract to purchase a valuable painting by the famous Galashiels portrait artist, Ishbel Whistler. When he arrived at the antique dealer s premises, he was informed by the sales assistant that his employer had changed her mind about selling the Whistler painting to him. Apparently, the antiques dealer has now received a much better offer from a prospective buyer in the United States.

Questions

1 List the legal remedies available to an innocent party who has suffered a breach of contract.

2 What is the most appropriate remedy that Alasdair should seek from the courts in this situation?

Anderson v Pringle of Scotland [1998]

Case Study 4

Karen runs a business which imports cheap cigarettes into Scotland from the remote Central Asian Republic of Waziristan. These products have proved very popular with Scottish smokers at a time when tobacco prices have risen sharply. Karen is shocked to be informed that the Scottish Parliament has now

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brought in legislation (The Regulation of Foreign Tobacco Products (Scotland) Act 2005), after medical studies showed that people who smoked these Waziri cigarettes were on average 100 times more likely to develop cancer when compared to smokers of other tobacco products.

As a result of the new legislation, it is a now a criminal offence to offer to sell or supply these products. Karen has huge consignment of cigarettes presently sitting in her warehouse waiting to be delivered to her business customers. Many of these business customers have now cancelled their orders as a result of the introduction of the new legislation.

Question 1

What is the status of Karen s contract with her business customers?

Stevenson & Sons Ltd v AG fur Cartonnagen Industries [1918] James B Fraser & Co Ltd v Denny, Mott & Dickson Ltd [1944]

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