HS Developers Pty Ltd was negotiating to sell an office space in the CBD to Go-Go Bank. Go-Go Bank refused to accept the terms of the contract until they were assured that there was no asbestos in the roof insulation. HS Developers gave oral assurance that there was no asbestos in the office and straight after the parties signed a contract for the sale of the office for a price of 2 million dollars. The written contract did not mention anything about asbestos.

Two months later, while a fire alarm test was being conducted, asbestos was found in the roof space above the office.

YOUR TASK 

Part A (5 marks): Advise whether Go-Go Bank can sue for breach of contract and/or terminate the contract. Would your answer change, if there was an ‘entire agreement’ clause in the contract?

Part B (5 marks): Advise whether Go-Go Bank is entitled to sue for damages for each of the following:

• $500,000 for costs associated with the removal of asbestos from the roof.

• $60,000 for loss of rent, as Go-Go Bank expected to lease the office.

• $5,000 for conveyancing fees (legal advice and paperwork done by a law firm).

On Friday, March 7, 2025, Maria purchased tickets over the phone for herself and her ten-year-old son, Marco, to visit Tuna Park, a popular theme park in Melbourne.

When Maria and Marco arrived at Tuna Park the next day, she was asked to fill out a form and sign it. When she asked what it was for, the staff member said it was for registration purposes and a chance for her to go in a lucky draw to win $1000. The form, however, included the following exclusion clause:

Tuna Park is not liable for any injury to you or the ticket holder, whether caused by your actions or the actions, omissions, or negligence of others.

This was the first time at Tuna Park for Maria and Marco, so they decided to start their visit with a ride on the theme park's main attraction: a famous and fast roller coaster. As the roller coaster reached its maximum speed (about 100 km/h), a sudden and violent jolt threw the riders against the safety restraints. Unfortunately, the unexpected jolt caused Marco serious injury and a broken shoulder, requiring surgery.

An investigation later revealed that the sudden stop was caused by a malfunctioning braking system that had been negligently maintained by an employee of Tuna Park.

YOUR TASK (10 marks) 

Last week, you started working at Tuna Park. This morning, you received an email from your supervisor seeking your opinion on the effects of the exclusion clause in relation to the roller coaster ‘incident’ (involving Marco), in preparation for a meeting with Tuna Park’s lawyer. Use relevant cases from contract law. 

(Do not refer to termination or remedies. Also, do not discuss the Australian Consumer Law or tort law.)

Before signing a contract for the sale of his house, Geraldine (the buyer) asked Trevor (the seller) whether the storm water drains were in order. In the last house she had owned, Geraldine had found that both storm water drains were blocked, and in a terrible thunderstorm, this had caused terrible flooding in her home.  She was very badly injured, and did not want the same thing to happen again.  Trevor assured Geraldine that the drains were in good working order. After receiving the assurance, Geraldine signed the contract to purchase Trevor's house. The contract made no reference to the state of the storm water drains. After taking possession, Geraldine discovered that the drains were actually completely blocked and badly broken. She now has to pay to have them replaced. Which of the following statements is most likely CORRECT?

When applying the objective test to determine whether a pre-contractual oral statement forms part of a contract, which of the following statements is NOT correct?

Sarah emails Annelise offering to buy her house for $1,000,000. The email also indicates that Sarah will keep her offer open for six weeks. Annelise replies with another email saying, “Hey thanks, I will come back to you shortly. I just need to check a couple of things with my accountants. Cheers.”

Three days before the 6 weeks expires, and before Annelise has accepted, Sarah sends another email to Annelise withdrawing her offer.

In the meantime, however, Annelise had bought a new house in Venice Beach, assuming that hers would be sold to Sarah. This cause a real shock when Annelise finds out that sale might not go ahead.

Which statement or statements is (or are) CORRECT?

   i. As there was an option contract between Sarah and Annelise, the former was not entitled to revoke the offer within the 6 weeks.

   ii. As there was no option contract between Sarah and Annelise, the former was entitled to revoke the offer within the 6 weeks.

   iii. Under the Electronic Transactions Act, in a case like this revocation takes effect once the offeree reads it.

   iv. Under the Electronic Transactions Act, in a case like this revocation takes effect once the email becomes capable of being retrieved by the addressee (i.e. when it enters the information system), even if it hasn't been read and even if the recipient doesn't know it is there.

Consider the following communications:

Sandra: 'I'll sell you my office fit-out equipment for $5,000.'

Joffrey: 'I'll give you $4,500 for it.'

Sandra: 'No deal.'

Joffrey: 'OK, I'll pay $5,000.'

Which of the following is MOST LIKELY correct in law? 

Imagine that the following paragraph describes an agreement that has been reached between Han Solo and Chewbacca:

I, Han Solo, in consideration of the sum of $10 paid to me, hereby grant to Chewbacca the right to purchase the Millennium Falcon within one week from this date at the price of $1,000,000.

Which of the following statements is INCORRECT?

Have you used generative AI in any way in completing this assessment? If so, you must provide a generative AI declaration here. If you do not complete this question, you are taken to declare that you did not use generative AI. 

Please adapt the following text template for your declaration: I used <ADD AI tool> (<ADD link if needed>) to <ADD how used> (<ADD number> iterations/drafts). I modified the outputs in <ADD ways>.

In 2022, Jose received

$300,000 from his mother in order to be able to afford his first house.

Last month, Jose’s mother

asked when he would start paying the loan back. Jose replied ‘I thought it was

a gift!’ The mother responded ‘

Which of the following

statements is likely to be 

In the context of the COVID-19 crisis, and

Australia’s economic recession, a Chilean restaurant in the city asked its

landlord for a rental reduction. The landlord agreed to a 50% reduction in

August 2020, and therefore the rent was reduced by 50% from September

2020. The Chilean restaurant, in reliance on the promise to reduce the

rent, installed a retractable front window (at its own expense) to provide for

socially distanced tables on the street front, and a new take away

food oven for preparing home deliveries.

In March 2022, the landlord notified the Chilean

restaurant owner that the rent would return to its original rate. In

addition, the landlord also stated that he wished to be reimbursed for

rent reduced between September 2020 and March 2022.

In relation to the promise to reduce the rent,

which of the following statements is likely