COMMERCIAL LAW CASE STUDY

Chapter: Sale of Goods & Consumer Protection

Question 1

Part a)

Ace Manufacturing Ltd agreed to manufacture and sell 5000 chairs to a convention centre. The contract contained detailed specifications for the chairs, and provided that the purchase price of $200 000 would be paid in two equal instalments: one half when the contract was signed and one half when the convention centre was notified that the chairs were ready to be picked up. The contract said nothing about when ownership of the chairs would transfer to the buyer. The convention centre paid the first installment when the contract was signed. The chairs were manufactured by Ace and were in Ace's warehouse when a serious fire destroyed the warehouse and all the chairs. Ace had not yet notified the convention centre that the chairs were ready for pick up, because the person who ordinarily makes such phone calls had been away from work due to an illness. Ace has demanded payment in full for the chairs from the convention centre. The convention centre has refused to pay the balance and has asked for a refund of the first installment it paid.

Applying the relevant and correct principle(s)of law discussed in the sales of goods contract, discuss whether title to the chairs has passed from Ace to convention centre and who bears the risk in the given situation.

Reference must be included.

Part b)

Bobrisky purchased a laptop from Procomp Industries Inc.'s online store for business use. After taking delivery, he discovered that the laptop had been preloaded with an adware program called ConsumerTrack (CT), a program which intercepts the user's secure internet connections and scans the user's web traffic to inject unauthorized advertisements into the user's web browser without the user's knowledge or consent. The adware also affects the computer's performance by increasing power consumption, decreasing battery life, hogging bandwidth, and wasting memory. The program also generally slows the laptop's operations although it does not prevent Bobrisky from running the programs he installed on the laptop or from using the machine for web surfing and other functions. The purchase contract states "the parties agree that warranties or conditions contained in the Sale of Goods Act do not apply to this transaction"

Applying the relevant and correct principle(s) of law discussed in the sales of goods contract advice Bobrisky on the propriety of the purchase contract. Discuss whether any of the provisions of the Sale of Goods Act will be of help to Bobrisky.

Reference must be included.

Question 2

Part a)

Owen had borrowed money from a credit union to purchase a car, and the credit union had required a security against the car, which they registered under the Personal Property Security Act. As well, Owen's father guaranteed the loan. Some months later, Owen decided to go back to school, and he had to sell the car to do so. He returned to the credit union and, at his request, the credit union gave up the security they had against the vehicle, knowing that they still had the loan guaranteed by Owen's father.Owen defaulted and, instead of repossessing the vehicle, the credit union demanded payment from the father.

Applying the relevant and correct principle(s) of law discuss the liabilities of the parties.

Reference must be included.

Part b)

After graduating, a student set up a business as a systems analyst. His monthly billings are healthy, about $10 000 a month. He rents his office, hardware, and furniture and owns few assets. He rents his apartment, has no car, and spends most of his income on concerts. If he approaches you, a bank manager, to borrow $50,000 for the purpose of increasing his working capital.

Identify, explain and apply the most appropriate security methodrequired to secure the above transaction.

Reference must be included.

Part C)

A petition for bankruptcy against Gold dust Inc., has recently been filed by the creditors on October 1 2020. One of the suppliers of Golddust Inc., who is owed $500.000, started a court action to reclaim that debt. The company has defended. On October 30^th 2020, the supplier wants to obtain a default judgment against Golddust Inc.

Applying the correct principle(s) of law, explain the legal position of the supplier, whether the action will succeed, and how the supplier would have been protected.

Reference must be included.

Question 3

Part a)

Tom was employed as a programmer by Mohawk Oil Company about three months after graduation. Because his friend, Harry could understand the program he was working on and because Harry write well, he requested Harry to take on the task of writing the manual to accompany the program.

Applying the relevant and correct principle(s) of law, discuss the legal issue(s) raised in the case scenario.

Reference must be included.

Part b)

Three students chose to work on a directed study project for Planned Parenthood Association. The project included the creation of an app for inventory control. The students went to the library to get a book on the topic. The book was in the reserve section, so the students made three copies of the four relevant pages so that they could study them. They used the ideas from the book and created an original app and a manual. Later, when the students were preparing a report for their presentation, they decided that the pages in the book exactly expressed the theoretical background they needed for the introduction. They copied those four pages and used them as their own for the beginning of their twenty page report. At the presentation, seven copies of the report were made (with the code and manual as appendices).

Applying the relevant and correct principle(s) of law, discuss the legal issues raised in the case scenario.

Reference must be included.