Justine owns and operates a successful waffle cafe in South Yarra called 'Pass the Syrup'. Customers love Justine's famous waffles which are made with a special type of buckwheat flour.

Justine has a written contract with Priya for the supply of the buckwheat flour, which is signed by both Justine and Priya. It is a term of the contract that the buckwheat flour be delivered every Thursday.

Priya calls Justine on Thursday morning and explains that she is unable to supply the buckwheat flour that week. The reason for her inability to deliver the buckwheat flour was due to temporary main road closures around her factory and detours in place through small suburban streets. To deliver the flour, Priya would need to hire small vans to transport the buckwheat flour to South Yarra, as her usual trucks were too big to travel on the small suburban streets. Priya had received several notifications about the road closures. Priya decided that the hiring of the small vans, and extra people to drive them, would result in too many additional costs being incurred by her. Justine is unable to make and sell her normal quantity of waffles without the flour delivery and suffers a loss of profit. She wants to claim her losses from Priya and sue Priya for damages for breach of contract. However, there is an additional term in the written contract between Justine and Priya:

"Under no circumstances will Priya be responsible for any loss or damage unless the loss or damage could be foreseen and avoided by the exercise of due diligence by Priya."

Justine argues 'there is no way that this term applies to our situation. If I didn't read it before I signed it, how can I possibly know about it?'

(a)Can Priya rely on the term in the contract to avoid liability? (5 marks)

(b) Does Justine have the right to terminate the contract? (2 marks)

(c) Does Priya have a legal excuse for not performing the contract? (5 marks)