BUSINESS CONCEPTS PRACTICE DEVELOPING YOUR ANALYSIS THROUGH THE IRAC APPROACH

Question 1 On 1 January, Bill sends an offer to Bob to buy his 1960s Chevrolet for $25,000. Bob would like to buy it but has to raise the funds. This takes him 3 months. He then replies to Bill on 8th April, saying he would like to buy the Chevy for the price quoted. In the meantime, Bill has received an offer from Belle; this offer was for $30,000 and she was able to pay within 2 weeks of acceptance. This date is 5th February and Bill has not heard from Bob and therefore accepts her offer. Bob is furious. He would like to sue Bill for breach of contract.

Required Do you think he will he succeed?

Question 2 Martin Morelli is a client of QRST Bank; he carries on a business as a real estate developer. His business has not been successful over recent years and he has refinanced a business loan with the bank several times. He has been unable to repay the bank, and they seek security for any further loans he may require. In March, he applies to the bank for a further loan, through his person bank manager, George Greedy. Martin says that his parents have a property which they will offer as security, and George and Martin go to their home to get them to sign the loan security documents. Martin's parents are elderly, and are inexperienced in business and legal situations. They have poor literacy skills, and arrived in Australia as migrants many years ago. They are poorly educated and cannot understand the documents. Martin and George explain that the documents are a guarantee to allow Martin to get the loan and that nothing will happen if Martin does not repay. They assure the parents that they do not need to seek independent legal advice. In fact, they are a standard security guarantee, which will allow the bank to foreclose if Martin does not pay. The parents sign the document and Martin receives the loan. Martin's business continues to decline and he defaults on his loan. The bank attempts to foreclose on the loan.

His parents seek your legal advice.

Required Provide Martin's parents with legal advice on their situation.

Use the IRAC method of problem solving.

3 Question 3 Barbara drove into a carpark under the Vido Supermarket at Carlton; there was a P sign at the start of the ramp but nothing more. When she got to the top of the ramp, there was a boom gate which raised when she arrived there. After going through the gate, she saw that there was another sign, but was not able to read it as another car was following closely. She parked the car and left it to walk to the lifts. As she passed the sign, she saw that it said 'Parking at Drivers Own Risk. The property owners take no responsibility for damage to vehicles, no matter how sustained". Barbara was confused by the sign but did not have time to change parking spots. She left the car where it was and went to her meeting. When she returned 2 hours later, the carpark was ablaze. All vehicles were destroyed. She had her laptop in the car as well. On the laptop was a new program she was developing. She has been advised that it was so revolutionary that it would be worth millions when she completed it and launched it on the market. She later discovered that the fire was caused by a carpark employee throwing a cigarette butt into a bucket of oily rags.

Required Barbara seeks your advice regarding any claims she could make against the Carpark operators.

Using the IRAC model of problem solving, identify actions that Barbara may take against the Car Park operators.