The Australian and French

governments sign a contract for the manufacture and sale of 10 submarines.

According to the contract, France would build 10 submarines whilst Australia

would pay $10 billion for them. After a change of Prime Minister in Australia,

the Australian government refuses to pay the price of the contract.

Which of the following

is 

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, refurbished the landlord’s premises. A retractable front window, to

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

food oven for preparing home deliveries, were also installed.

In March 2022, the landlord notified the Chilean

restaurant owner that the rent would be put back up to its original rate. The

landlord also communicated that he wished to be reimbursed for the reduction in

the rent between September 2020 and March 2022.

Which of the following statements is CORRECT?

Precision Construction Ltd enters into a

contract to build a block of four apartments for Caitlin for $2,000,000.

Caitlin is very keen for the work to be completed by June 2024 as she has

already sold the apartments ‘off the plan’ (that is, before they are

constructed).

The construction company commences work but

realises that due to rising costs it will only be able to complete the

apartments on time at a financial loss. Thus, Precision Construction Ltd

approached Caitlin and asked for an additional $200,000 to do the job that it

was already contracted to do. Caitlin refuses to pay this extra amount. The

construction company then replies ‘Ok … but if you don’t pay us the extra

money, you can wait until Christmas and see how you deal with the owners of the

apartments for all of those delays.’

Caitlin then reluctantly agrees to pay the extra

money, and the construction company completed the apartments on time.

Which of the following statements is MOST CORRECT?

After discussions with a sales representative,

Shu purchases a new iPhone from the Apple store.  During their

conversation, they do not discuss phone insurance.  Five minutes after Shu

pays for the phone and receives her receipt via email, she receives a further

email indicating that she will enjoy complimentary (that is, free) 7 day

phone insurance.

According to the law of contract, is Apple

legally bound to honour its promise to provide 7 days free insurance?

A retailer advertises a new line of jeans,

called ‘Holey Jeans!’ The jeans are so popular that they are completely sold

out of stock in just a very short period of time. When Cersei goes into the

store to purchase a pair of ‘Holey Jeans!’, no jeans are left.

Which of the following is CORRECT, in relation to the law of contract?

Mick, a famous songwriter, lost his briefcase

last Friday. He is very upset, as his briefcase contains the lyrics of a new

song that Mick had written, called “Paint it White”. He advertises a reward of

$1,000 in a local newspaper for the return of his briefcase. Amy reads the note

in the newspaper and, the day after, finds the briefcase and returns it to

Mick.

Which of the following statements is CORRECT?

Lisa is thinking of buying a new house. On

Saturday, she inspected a large residential property in Melbourne which met all

her criteria. The real estate agent told her that the price of the house was

$2.5 million. Lisa replied that she really liked the house, but that she will

need some time to organise finance. Then she adds, ‘I will give you $50 if you

keep the offer open for two weeks’. The real estate agent agrees, Lisa hands

him a $50 note, and he puts the note in his wallet.

After three days, the real estate agent contacts

Lisa and tells her that he revokes the offer, as the house has been sold to

someone else. He also adds that he will give her the $50 back. Lisa seeks your

advice.

Which of the following is CORRECT?

Imagine that section 6 of the Tax Return

Act 2010 (Cth) (the ‘TRA’) states:

• “If the taxpayer submits an

  inaccurate tax return, the taxpayer will be penalised with a fine equivalent to

  3 times the tax that they ought to have paid.”

The TRA was passed for the purpose of

preventing tax underpayment.

Homer, a man of high integrity who is

nevertheless sometimes a bit naive, has been charged with submitting an

inaccurate tax return under the TRA and the Australian Taxation

Office is seeking a penalty under section 6. Homer stated a personal tax

liability of $30,000 when it should have been $20,000 (meaning that he actually

should have paid a lower amount of tax).

Which statement or statements is (or are) most

likely to be 

i. Homer’s lawyer will rely on

a literal interpretation of the TRA.

ii. The ATO will seek to rely

on an interpretation of section 6 of the TRA which follows the

purposive approach.

iii. Homer’s lawyer will likely

argue that if we look at the purpose of the TRA, her client did not breach

section 6. In this sense, this section should only apply to cases

concerning tax underpayment (i.e., the rule does not cover cases about

overpayment).

iv. The ATO, arguing for a

literal interpretation of section 6 of the TRA, will argue that Homer did

breach the provision and, therefore, he must pay the fine. They will insist

that section 6 of the Act does not distinguish between overpayment and

underpayment and, therefore, the penalty applies in either case.

Assume that there is a validly enacted

Commonwealth Act (the Civil Actions Act 2024 (Cth)) which states the following:

• ‘It is illegal to place

  limits on the damages that may be claimed in a civil action.’

Assume also that there is a piece of Victorian

legislation (the Cap on Damages Act 2022 (Vic)) which states the

following:

• ‘The maximum damages

  required to be paid in civil actions cannot exceed $100,000,000.’

Which of the following is CORRECT?

Ruth offers to sell her violin to Laura. She

tells Laura that if she wishes to accept, she needs to communicate acceptance

by sending an email to her email address ([email protected]). In these circumstances,

a contract will be formed: