Assessment Coversheet

Unit/s assessed	FNSTPB503 Apply Legal Principles in Contract and Consumer Law
Assessment name	FNSTPB503 Assignment

Type of Assessment This summative assessment will enable your assessor to make a judgement of competency based on the submission of your completed assessments against the requirements of the unit/s of competency in this module. Benchmark The Assessment Benchmark developed for each unit of competency is the evidence criteria used to judge the quality of performance (i.e. the assessment decision-making rules).Assessors use these benchmarks to make judgements on whether competency has been achieved and to determine if you have performed to the standard expected to meet the unit requirements. Reasonable Adjustment Where appropriate Monarch Institute will allow flexibility in the way in which each unit is assessed based on the needs of an individual. Assessment Coding Assessment of this course is based on competency-based principles. S = Satisfactory NS = Not Satisfactory If you fail to perform satisfactorily for the assessment in the prescribed way you may be assessed as Not Satisfactory. You are required to be assessed as Satisfactory in all assessments for each unit of competency. Re-assessment Your assessment can be submitted after you have reviewed the learning materials and practiced enough to feel confident in your resubmission. You have two weeks from your last submission feedback to resubmit. You are re-assessed in only the areas where your assessor has indicated you were initially assessed as NS. It is at the assessors discretion to re-assess the entire assessment should an overall understanding not be demonstrated.When you are re-assessed as satisfactory after re-submission you will achieve competency for this assessment. Declaration of Understanding and Authenticity I acknowledge the assessment process has been explained and agree that I am ready to undertake assessment. I am aware of where to find the assessors feedback for the assessment. I am aware of the appeals process, should the need arise. I also understand I must be assessed as satisfactory in all parts of the assessment/s to gain an overall competent result for the unit/s of competency. If I am found to be NS after a second attempt, it is at the assessor s discretion whether I may be permitted one final attempt. I am aware that a not competent final outcome means I may incur fees for re-enrolment in the unit/s. I certify that the attached material is my original work. No other persons work has been used without due acknowledgement. I understand that the work submitted may be reproduced and/or communicated for the purpose of detecting plagiarism. I understand a person found responsible for academic misconduct will be subject to disciplinary action (refer to Student Information Handbook). * I understand that by typing my name or inserting a digital signature into this box that I agree and am bound by the above student declaration.

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Submission instructions:

1. Complete the Declaration of Understanding and Authenticity (above).
2. Once you have completed all parts of the assessment login to the Monarch Learning Management System (LMS) to submit your assessment.
3. In the LMS, click on the link to Submit [assessment name] in your course and upload your assessment files. Click save and then click submit assignment
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Assessment Activity 1: Achieving Contract Formation (CHAPTER 2)

Activity instructions to candidates

• This is an open book assessment activity.
• You are required to read this assessment and answer all 8 questions that follow.
• Please type your answers in the spaces provided.
• Please ensure you have read Important assessment information at the front of this assessment
• Estimated time for completion of this assessment activity: 2 - 3hours

Question 1.1 What is the fundamental difference between an agreement and a legally binding contract? Question 1.2 Identify four contracts about which a client may seek advice from a financial services provider. Question 1.3 Lucy is a client whose tax and business matters you have dealt with for some time. She has been married for 10 years to Desi but they are currently separated whilst they consider divorce. Desi runs his own separate business. They have entered into various private agreements during the life of the marriage concerning money. Lucy wants to know under what type of circumstances would a private agreement between a husband and wife be considered contractually binding? Question 1.4 What is a 'letter of intent' and in what circumstances are such documents likely to be used? Question 1.5 In what commercial situation may a client seek a letter of comfort? What three forms may it take? What is a 'letter of comfort'? Name a commercial situation where 'letters of comfort' are commonly used. Question 1.6 What are some of the ways an offer and acceptance can be communicated between the parties to a contract? Question 1.7 List some of the ways an offer may lapse. Question 1.8 Valentine spotted a lovely blackwood bookcase in an antique shop owned by Tristan, which had a price tag of $5,000. Valentine approaches Tristan and tells him she will take the bookcase for $3,000. Tristan says that isn't possible but how about $4,000? Valentine says no, how about $3,500? Tristan says no to which Valentine replies that she will accept Tristan's offer of $4,000. Tristan does not reply but turns to serve another customer Isolde, as Valentine steps away from the counter to take a call on her mobile phone. Valentine then turns to pay for the bookcase, but Tristan says he has already sold it to Isolde for $5,000. Valentine is furious and says that she and Tristan had a contract and the bookcase was hers. Is Valentine correct? Give reasons for your answer. Activity instructions to candidates

• This is an open book assessment activity.
• You are required to read this assessment and answer all 7 questions that follow.
• Please type your answers in the spaces provided.
• Please ensure you have read Important assessment information at the front of this assessment
• Estimated time for completion of this assessment activity: 2-3 hours

Assessment Activity 2: Achieving Contract Validity (Chapter 3)

Question 2.1 A minor does not have the capacity to enter into a contract which will be enforceable against them, except in exceptional circumstances. Why? What are those exceptional circumstances? Question 2.2 If a person who is intoxicated enters into a contract with another person will that contract always be voidable by the intoxicated person when they return to sobriety? Give reasons for your answer. Question 2.3 Tom, a client who is a commercial builder, entered into a contract with Roger to undertake construction of an office building. Two months ago, Tom paid Roger $15,000 under a clause in their contract which required Tom to pay this sum if Tom's work breached the National Construction Code. Tom has just been informed that the clause of the Code he allegedly breached is invalid because of an inconsistency with environmental protection legislation. Can Tom recover his $15,000? Give reasons for your answer. Question 2.4 In what relationship does the presumption of undue influence arise? Question 2.5 What is the definition of a guarantor? What is the legal responsibility of a person who agrees to be a guarantor on a loan for someone else? Question 2.6 A young couple wishes to take out a sizeable home loan and, at the insistence of the bank, your client, asks the husband's elderly Chinese parents to guarantee the loan. The parents have very limited spoken and written English. Under what circumstances would you advise your client, the bank, that they could successfully rely on this guarantee should the young couple default on their loan? Question 2.7 Dianne recently received a substantial inheritance and is now keen to invest in a catering business. She obtains the advice of Smart Advisors Pty Ltd. Smart Advisors assign Andrew as her advisor and after some consultation, Andrew recommends that Dianne invest in 'Feed Me Cafe'. Andrew assures Dianne that the cafe has a strong trading history and that its prospects are highly favourable. The caf is seeking investors to join the business so that it can expand into offering a franchise. Andrew assures Dianne that there are excellent profit prospects for the forthcoming year. Dianne relies on Andrew's advice and she decides that she also would like to invest extra funds to achieve an even greater return. Dianne is excited by this opportunity and contacts a friend, Tina. Tina has poor health as well as a minor mental disability and depression. Following from the recent death of her father, Tina has been left unable to cope well in the wider community. Tina relies on Dianne for advice and support. Dianne asks Tina to lend her $30,000 in the hope that she will be able to double this amount for Tina. Dianne tells Tina that she (Dianne) would be really happy if Tina would provide her the money and so Tina gives Dianne the money. Dianne asks Tina to sign a document that states that Tina has provided Dianne with an interest free loan, to be repaid if and when the cafe venture succeeds to Dianne's satisfaction. Within 9 months, Feed Me Caf is trading at a significant loss and Dianne has lost most of her investment monies. Around this time Dianne learns that Andrew provided his advice based on inaccurate and old financial information. She also becomes aware that Andrew had failed to advise her that the cafe was about to be penalised for a breach of their food license conditions. Dianne is very angry and upset. Tina's niece hears about Dianne's behaviour and insists that Dianne repay Tina, claiming that the loan agreement is not valid. Provide Dianne and Tina with your advice about whether there is any action and against whom they may take it, giving reasons for your answers. Assessment Activity 3: Identifying and Enforcing Rights and Obligations (Chapter 4) Activity instructions to candidates

• This is an open book assessment activity.
• You are required to read this assessment and answer all 6 questions that follow.
• Please type your answers in the spaces provided.
• Please ensure you have read Important assessment information at the front of this assessment
• Estimated time for completion of this assessment activity: 2-3 hours

Question 3.1 Why is it important to identify the terms of a contract? Question 3.2 Using examples, describe how you would explain to a client the differences between conditions and warranties, and why the differences matter? Question 3.3 How would you explain to a client the effect of a signature on a contractual document? Would your explanation be different if one of the parties had not bothered to read the terms of the contract? Give reasons for your answer. Question 3.4 List three contractual transactions which are required by Australian legislation to be recorded in a written document. Question 3.5 Michele has undertaken an inventory of the electrical appliances throughout her business and discovers that some require cleaning and repair. Michele takes the appliances to Rolando the repairer, with whom she has not dealt before. Unfortunately, whilst the goods were waiting to be repaired, Rolandos repair shop was burgled and the appliances stolen. Rolando refuses to accept liability for the loss and draws Micheles attention to a small sign on the door leading into a back room of the shop which says No liability for loss or damage to goods accepted under any circumstances. Rolando points to these same words printed on the back of the receipt Michele was handed when she deposited the appliances for repair. Is Rolando correct in his refusal? Give reasons for your answer. Question 3.6 What is a standard form contract? What is the difference between a commercial standard form contract and a consumer standard form contract? Use examples to explain your answer.

Assessment Activity 4: Contractual Performance, Managing Termination and Breach (Chapter 5)

Activity instructions to candidates

• This is an open book assessment activity.
• You are required to read this assessment and answer all 6 questions that follow.
• Please type your answers in the spaces provided.
• Please ensure you have read Important assessment information at the front of this assessment
• Estimated time for completion of this assessment activity: 2-3 hours

Question 4.1 In what circumstances can a third party (stranger) to a contract be held liable in the event of a breach? Question 4.2 In certain circumstances, rights can be assigned due to operation of law. List three circumstances where such assignment can occur. Question 4.3 Sheila entered into a domestic building work contract with Bruce to build her first home for $200,000 in six months. The contract set out that progress claims would be paid when the footings were poured, at completion of walls, at completion of roof cover, second fix carpentry and practical completion. All obligations are met until the progress claim for completion of the walls has been paid, after which Bruce becomes busy with other work and stops working on Sheilas house, despite her protests. When no further work has been completed after a further six months, Sheila takes action for breach of contract against Bruce and hires another builder to complete the work. Sheila wants Bruce to pay back the first two progress claims. Will she be successful? Give reasons for your answer. Question 4.4 What is the purpose of a force majeure clause? Under what circumstances will they apply? Question 4.5 Paige is a financial consultant who has entered into a contract to work exclusively for Annies company for two years. Three months into the contract, Annie informs Paige that her services are no longer required because she wants to take the company in a different direction. Paige intends to sue Annie for damages for breach of contract. Explain the matters the court will take into account in assessing the measure of damages they will award Paige. Question 4.6 Now for some fun, complete the following crossword puzzle.

											1
						4									5
													2
								3									4
							1
3
			2

Across 1. An unforeseen event, the fault of neither party which makes it impossible for the contract to be performed. 2. A remedy to put the injured party in the position they would have been in if the contract had been properly performed. 3. A court order preventing someone from performing a specific act. 4. Where one party leads the other party to reasonably believe that they will not be insisting on strict performance of the agreed terms. Down 1. The concept that provides only the parties to the contract can enforce it. 2. A three party agreement whereby the original parties agree to discharge their contract in consideration of a new contract being entered into between one of the original parties and a third party. 3. When each party properly performs their contractual obligations and the contract is discharged. 4. Attempted performance. 5. A remedy that restores the parties to their pre-contractual position, nullifying the existing contract.

Assessment Activity 5: E-Contracts: Principles and Practice (Chapter 6)

Activity instructions to candidates

• This is an open book assessment activity.
• You are required to read this assessment and answer all 6 questions that follow.
• Please type your answers in the spaces provided.
• Please ensure you have read Important assessment information at the front of this assessment
• Estimated time for completion of this assessment activity: 2-3 hours

Question 5.1 Define the term E-commerce. Question 5.2 Are there any exceptions to the type of contracts which can be made electronically? Explain your answer using examples. Question 5.3 Heidi has been a client for some years, operating a traditional retail business. She has now made the decision to operate online as well and seeks your advice as to undertaking online transactions. Heidi has the following questions:

1. When making an offer over a website, to whom is the offer being made?
2. With what legal requirements must Heidi comply?

Question 5.4 What are the requirements of electronic signatures under the ETA? Question 5.5 Explain the use and significance of Australian Business Number Digital Certificates. Question 5.6 List three rules under which domain names are allocated.

Assessment Activity 6: Contractual Agency (Chapter 7)

Activity instructions to candidates

• This is an open book assessment activity.
• You are required to read this assessment and answer all 6 questions that follow.
• Please type your answers in the spaces provided.
• Please ensure you have read Important assessment information at the front of this assessment
• Estimated time for completion of this assessment activity: 2-3 hours

Question 6.1 Ginny works for the Poptop Makeup Shop. She signs a contract with Glamour Co. for a shipment of lipsticks to be stocked at Poptop. Poptop never agreed for Ginny to be their agent, but are thrilled with the deal she struck, and decide to stock the lipstick in accordance with the contract. Poptop has a change of heart after closer examination of the stock. They wish to withdraw from the contract and argue the contract is not enforceable by Glamour Co. because at the time of signing, Ginny was not Poptops agent. Is the contract enforceable? If so, from what point in time? Question 6.2 Stephen appointed Daniel from Daniels Real Estate to sell his property. Because Daniel is too busy, he subcontracts the sale to Michaels Real Estate, without Stephens permission. Has Daniel done anything unlawful? Question 6.3 Tilly engages Shona as an agent to sell her business to Selva. Is Shona a Party to the contract to sell the business? Explain. Question 6.4 Explain how an agency relationship differs from that of an independent contractor. Question 6.5 Which party (agent, principal or third party) would not be held liable for fraudulent misrepresentations where the agent acted outside their authority? Question 6.6 Joe, in his capacity as an agent for Silvio, is authorised to purchase cattle at a limit of $200 each. Joe could not purchase the cattle at this price so he purchased in his own name, 400 cattle at $300 each. Subsequently Silvio conferred with Joe and agreed to ratify his act. Neither Joe nor Silvio will pay for the cattle when delivered. Who is liable?

Assessment Activity 7: Consumer Protection Law ( Chapter 10)

Activity instructions to candidates

• This is an open book assessment activity.
• You are required to read this assessment and answer all 5 questions that follow.
• Please type your answers in the spaces provided.
• Please ensure you have read Important assessment information at the front of this assessment
• Estimated time for completion of this assessment activity: 2-3 hours

Question 7.1 Can omitting to provide information ever count as misleading or deceptive conduct? How would you explain this concept to a client? Question 7 .2 A client contacts you having received several complaints about the manner in which they are advertising their prices. The client operates a bike shop, and they have been advertising bikes for $300. In reality the full price a consumer has to pay is $330 because of GST. Your client has presumed a customer will simply imply this and add it to the price. Are the complaints of the consumers justified? How would you explain this to your client and what advice would you give them to ensure they operate in compliance with the ACL? Question 7.3 Anthea sold Bob some paper and pens for $65. Anthea did not give Bob a receipt. Has Anthea done anything unlawful? Question 7.4 Marc is considering entering into a mobile phone contract with GreedyGuts Phones. He is upset to find out that within the contract, there is a term stating that if Marc defaults on payment of his monthly statement, there is a default fee that increases by 10% every day of default. Marc considers this extreme but the salesperson informs him that this contract is standard form and its terms are non-negotiable. What argument could Marc make? Do you think he would be successful? Question 7 .5 Sebastian is going camping in the snow and asks the sales assistant which sleeping bag would be the best for his requirements. He is advised that the SleepDry bag is the best but in fact he gets wet and cold while camping. Who would be responsible for his miserable camping trip: Sebastian, the manufacturer or the sales assistant? Do you need further facts to answer this question fully?

Assessment Activity 8: Restrictive Trade Practices ( Chapter 11)

Activity instructions to candidates

• This is an open book assessment activity.
• You are required to read this assessment and answer all 5 questions that follow.
• Please type your answers in the spaces provided.
• Please ensure you have read Important assessment information at the front of this assessment
• Estimated time for completion of this assessment activity: 2-3 hours

Question 8.1 Ting and Chrome are separate businesses that manufacture hats. Muhammad invites them both to make offers to stock his shop. Ting and Chrome get in contact with each other and agree not to sell any of their hats to Muhammad for less than $40 each. Have Ting and Chrome done anything illegal? Explain your answer with reference to the CCA. Question 8.2 Harmony Publishers provide Bookworm Bookshop with a variety of books. The bookshop begins selling Harmony's books at a discounted price. Harmony contacts the Bookshop and asks them to sell the books at their recommended retail price. Bookworm refuses. Harmony withholds the supply of books until the discounting stops, placing the Bookshop in a difficult financial position. Has the Bookworm Bookshop done anything unlawful? Has Harmony Publishers done anything unlawful? Question 8.3 Penny provides free-range eggs to Bob's Diner. Penny's husband, Ted, is an excellent plumber but has been having a hard time finding work. To help her husband, Penny tells Bob she will only continue providing him eggs if he hires Ted at a fair price for any plumbing needs the diner may have. Has Penny acted lawfully? Explain your answer. Question 8.4 Jia Pty Ltd and Katcan Pty Ltd are competitors in the poultry market. They agree to supply fewer organic chickens to stores for a period of eighteen months to push up prices. Is this lawful? Why or why not? Question 8.5 Explain what is meant by a cartel.

Assessment Activity 9: Financial Services Consumer Protection (Chapter 12)

Activity instructions to candidates

• This is an open book assessment activity.
• You are required to read this assessment and answer all 2 questions that follow.
• Please type your answers in the spaces provided.
• Please ensure you have read Important assessment information at the front of this assessment
• Estimated time for completion of this assessment activity: 2-3 hours

Question 9.1 Jacob is a stockbroker who, over the course of a year, sold 1.5million shares in a company, ChemTex to people and other companies that he was affiliated with. He did this so that ChemTex looked like a success and encouraged others to trade. Has Jacob done anything unlawful? Question 9.2 Boris seeks personal investment advice from Rory, a financial adviser and AFS licence holder. Boris, a 60 year old client with an income of $60,000 per year, is considering investing his life savings of $300,000 in a new technology company. Rory uses accurate data to calculate that the company has a 50% chance of tripling his money and a 50% of going broke. Rory advise Boris to make the $300,000 investment.

Has Rory fulfilled his obligations as an AFS licensee?

Attachments:

FNSTPB503-ass....docx

Answer rating: 100% (QA)

Assessment Activity 1 Achieving Contract Formation Question 11 Fundamental Difference Between an Agreement and a Legally Binding Contract Agreement An understanding or arrangement between two or more ... View the full answer