The Lame Duck Restaurant owned by Johnny appoints a sales and marketing representative (Summer) to design and launch new website. Summer is very bright and her design looks amazing. As the website is exceptional, Johnny decides to revamp the pricing system and put 15% mark-up on all food. Summer develops beautiful design of the new pricing system and posts it online.
Two weeks later after the prices are changed, Li books the wedding using the menu he found on one of the tables. Summer mistakenly accepts the booking, asking Abu from accounts to accept the deposit and finalise the invoice. Li calls, accepts the quoted price, pays the deposit and books the date for the wedding. The same day, Li sends out invitations to all her friends studying at CDU. The day before the banquet, the error in the quotation is discovered. Johnny gets involved, calls the customer and says that the Lame Duck Restaurant cannot host the wedding (because the quotation was made in error). However, Li insists that ‘we have a contract’ and says that under the law the Lame Duck Restaurant must deliver.
(5 marks)
(5 marks)
Requirement a
There is valid contract amid Johnny and Marie as Steven who was an employee below Johnny assured to host the banquet on a corporate party for Marie at a scheduled price and under a lawful offer and acceptance on both ends. There is a clause under the English Contract Law which conditions that agreements are deliberated to be contracts only when they are made between parties who are capable to contracts and are free from any intimidation or unnecessary influence. Also there has to be lawful consideration along with an object which is lawful, failing to which the agreement is deemed to be void.[1] Here we can find two capable parties, Steven and Marie with free accord to form a valid contract, in addition to a lawful consideration which is the pre-determined price quotation set between Steven and Marie, a lawful object is also present which is the booking made for the banquet to host a corporate party and lastly communication between offeror and offeree is also present which completes the offer and the acceptance between them. Thus basic essentials of contracts are fulfilled making it a lawful contract and legally binding upon the offeror to perform the contract. Under the English Contract Law a valid contract can either be expressed or implied, oral or written.
Requirement b
Yes, there occurs a mistake on part of Steven because he unintentionally quoted the birthday occasion price instead of corporate party price to Marie who made a reservation for a corporate party on the new year eve. English contract law distinguishes three types of errors in a contract namely: Common mistake, Mutual mistake, Unilateral mistake. Here we find it’s a autonomous mistake wherein only one party is mistaken, further Unilateral mistake can be subdivided into: Error as to terms of contract and mistake as to identity. Mistake as to terms of contract satisfies the case study here. There was a mistake in value while the contract was made initially and mistake in value is considered one of the terms in a contract. Thus this is a void contract as to a mistake.
Requirement c
The provisions of English Contract law is relevant here because the requisites of contract are satisfied as per the case study, which further gratifies Johnny the owner of Lame Duck Restaurant to achieve the contract at the original quoted price which his employee Steven had conversed to Marie for hosting the banquet. Steven was in the course of employment under Johnny when such legal contract with Marie was undertaken. Thus Johnny is vicariously liable for the promise which his employee Steven has undertaken on behalf of Johnny and so must perform to avoid breach of the said contract else Marie can sue Johnny and his Lame Duck Restaurant for breach of contract as per the provisions defined in the contract law.
The Lame Duck Restaurant owned by Johnny appoints a sales and marketing representative (Summer) to design...