Either Representation Or Contractual Term †Myassignmenthelp.Com

Question: Discuss About The Either Representation Or Contractual Term? Answer: Introducation The statements which are made at the time of negotiation amount either to a representation or to a contractual term. It is essential to understand in the given situation whether the statement made by the salesperson was a representation as that will determine the remedy that would be appropriate. If it is a statement that amounts to a term of contract that has not been fulfilled the party may sue for breach of the contract. If however, the statement made is a mere representation that is no true then an action for misrepresentation can be brought. If the knowledge of the representor is greater than the knowledge of the representee then in that case the statement made would form a contractual term. As in the case of Dick Bentley Productions v Harold Smith Motors wherein the statement with respect to the condition of the car was made by the defendant who was a car trader specializing in the prestige market (Dick Bentley Productions v Harold Smith Motors, 1965). This statement turned out to be not true, the issue that arose was whether this statement formed a term in the contract or was a representation, if then it would be an innocent misrepresentation then due to time lapse there would be no rescinding of right to claim. The court however opined that this statement was a term in the contract since the car dealer had higher expertise and reliance was placed by Mr. Smith on it. Further, in the situation where the representee indicates to the representor the statements importance it would be a term. As in the case of Bannerman v White wherein the court opined that the statement made by the salesperson that the hops had not be treated with sulphur was not a representation but a term of contract as it had been communicated by the claimant the terms importance and reliance had been placed on it (Bannerman v White, 1861). The action for breach of contract was successful. Section 13 of SA provides that the description of the properties and the goods should match. It is not the quality but the the description of the product that this section concerns with (Arcos v Ranaason, 1933). Further section 14(3) states that where it has been informed by the buyer to the seller of requirement of certain qualities then higher standards are placed. The seller under this would be liable even in the situation wherein the safety aspect has been met however, the product is not specific to what was required by the purchaser (National Foods Ltd v Pars Ram Brothers (Pte) Ltd, 2007). Application of Law In the given situation, the statement was made by the salesperson with respect to the specific requirement of Charlie, where the salesman dealing with the item had more knowledge of it as compared to Charlie, that the item was very good and reliance was placed by Charlie on this statement, thus applying the principle established in the Bannermans case and Dick Bentley Productions case the statement made was a term of contract and this had been breached as the equipment did not provide with water that was safe for drinking. Further as per section 13 the description of the product did not correspond with the item, whereas it was stated that the item would provide drinking water however, the same was not true and section 14(3) where Charlie had informed the salesperson that he specifically needed the item for producing drinking water higherClean Aqua Pty Ltd Whether a case can be brought against Clean Aqua Pty Ltd. by Charlie under the strict manufacturer liability in the Australian Consumer Law Rule of Law ACL: Part 2-1: provides that manufacturers are required to prohibit from deceptive or misleading conduct; or unfair practices or likely to deceive or mislead. Section 18 of the Australian Consumer Law (ACL) provides that A person must not, in trade or commerce, engage in conduct that is misleading or deceptive of likely to mislead or deceive. In ACCC v Singtel Optus Pty Ltd (No 4) [2011] FCA 761, wherein for a misleading advertisement with respect to plans of an internet broadband a penalty of $5.26 million was ordered against Optus (ACCC v Singtel Optus Pty Ltd (No 4), 2011). In the case of ACCC v Yellow Page Marketing BV where a penalty of of $1.35 million was ordered for a directory scam against two companies by making representation that was misleading that they had an an affiliation with the Yellow Pages (ACCC v Yellow Page Marketing BV (No 2), 2011). In the case of ACCC v TPG Internet Pty Ltd the court had opined that the message that is dominant is central for assessing as to whether the advertisement led to a conduct that was deceptive or misleading; and the statements that are qualifying which accompany the headline are required to be sufficiently clear and put in prominence so as to avoid misleading the customers (ACCC v TPG Internet Pty Ltd, 2013). However, the users have been given the right under Part 3-5 of the Australian Consumer Law to place direct liability can be placed on the manufacturer in the case wherein damage is caused by a product that is defective. There is required to be a safety defect in the goods meaning thereby that the safety of the product is not what is is acceptable generally. As was opined in the case of Cook v Pasminco that it is a poison that does not do its deadly work that is defective rather than one that does. (Cook v Pasminco, 2000). Application of Law Though in the given scenario there is a possibility of there being a misleading conduct in the manner in which the manufacturer has named and is advertising the product as Clean Aqua that it can lead the purchaser to believe that the water is safe for consumption. However, there is no safety defect in the item and the item is performing the functions that are to be performed by it which has been specifically mentioned by the manufacturers while advertising on the box that it is not suitable for oral consumption. The decision of the High Court in ACCC v TPG Internet Pty Ltd that the dominant message is what is central for assessing as to whether the advertisement led to a conduct that was deceptive or misleading; and the statements that are qualifying which accompany the headline are required to be sufficiently clear and put in prominence so as to avoid misleading the customers. In the given situation the name of the product was the dominant message which was advertised and the warnin g was placed only on the box which could mislead the customer. However, it is only under part 3-5 that users have been given the right to put direct liability on the manufacturer if there is a product defect. The product was not defective as in the case of Cook v Pasminco, it was functioning in the manner it was required to function since it was not manufactured for providing drinking water. The position of Charlie is not as strong in the given situation for an action against the manufacturer. References ACCC v Singtel Optus Pty Ltd (No 4), FCA 761 (2011). ACCC v TPG Internet Pty Ltd, HCA 54 (2013). ACCC v Yellow Page Marketing BV (No 2), FCA 352 (2011). Arcos v Ranaason, AC 470 (1933). Bannerman v White, 10 CBNS 844 (1861). Cook v Pasminco, FCA 677 (2000). Dick Bentley Productions v Harold Smith Motors, 1 WLR 623 (1965). National Foods Ltd v Pars Ram Brothers (Pte) Ltd, 2 SLR 1048 (2007)