Multiple Choice

Q1 Marco wanted to buy a candle. He saw an advertisement in a local paper by "Monica's Candles" advertising a large multi-coloured unicorn shaped candle for $2.00.Monica is the owner of "Monica's Candles." Marco went to "Monica's Candles" and asked for the unicorn candle.Monica said that was just an advertising gimmick and she had none in stock.She said she had a rainbow coloured candle that smelled like raspberries when it was lit for $100.00.Monica showed him a display model that was just as Monica had described.Marco said he would take one.Monica got one in a box from the store room, wrapped it and sold it to Marco for $10.00.When Marco got home he was disappointed to see the candle in the box was not rainbow but rather black and when he lit it, it smelled like a dead skunk.Which of the guarantees in the Australian Consumer Law has Monica breached:

E Both c. and d.

D Section 54 guarantee that goods must be of acceptable quality;

C The section 35 prohibition against bait advertising;

B All of them because it is a terrible product Monica sold to Marco;

A None because Marco is not a consumer;

Q2 Donald wanted to buy a Super Mario Bros. video game. He went to a gaming store owned by Stormy Pty Ltd.As he walked into the store, there was a sign prominently displayed in large letters which said "All sales FINAL, there are no refunds or replacements given for any reason and all implied terms, conditions, warranties and guarantees are hereby excluded." After seeing the sign, Donald proceeded to buy the Super Mario Bros. game.When he played it at home, there was a problem with the game.Every time the Toad character in the game would appear, the game would seize up and he couldn't play it any longer.After doing some research, Donald discovered that the game he purchased was from a defective batch. Donald took the game back to the store for a refund or replacement.The assistant at the store pointed to the sign and said there were no refunds or replacements given. Which of the following is correct:

F Both a. and c. are correct.

E Stormy Pty Ltd could sue Donald for public nuisance as he has defamed the company by asserting it sells defective products;

D Stormy Pty Ltd has breached the implied term to act in good faith as was discussed in Burger King Corp v Hungry Jack's Pty Ltd(2001) 69 NSWLR 558;

C As a result of the sign, no terms would be implied into the contract under the Sale of Goods Act;

B As a result of the sign, the guarantees in the Australian Consumer Law would not apply;

A It is likely that the statement in the sign formed an express term of the contract because reasonable notice of the term was given to Donald prior to entering the contract;