Note to Students: Remember to support your analysis with reasons, case law and/or

statutory provisions (where applicable).

Question 1

Benjamin had just obtained the keys to his new flat, and he wanted to engage a contractor who could help him with the carpentry works for his flat.

Benjamin called Roger, his friend and ex-classmate, and told him the following:

"Hey friend! I am looking for someone to do the carpentry works for my new flat. Can you do it, and how much will you charge?"

Roger replied:

"Sure! Anything for an old friend! Send me the floor plans and I will start working!"

As the phone line quality was poor, Benjamin only heard the phrase "send me the floor plans".

After the phone call ended, Benjamin sent Roger the floor plans via email. They also arranged via email to meet up at the flat two days later for Roger to view the flat and take measurements. On the day that they met up, Roger diligently took measurements, and listened to Benjamin's requirements about the carpentry works.

The next day after the viewing, Roger sent an email invoice with detailed terms to Benjamin. The email invoice provided a breakdown of the carpentry works, and also stated that the works will cost $20,000 in total. Initially, Benjamin only took a quick glance and emailed "OK" to Roger, which was immediately seen by Roger as he was working on his computer. A few hours later, Benjamin spent more time thinking about the details of the works and felt that they were overpriced. Benjamin then called Roger to ask why the price was so high. Roger explained that it was due to the cost of materials, but Benjamin was not convinced. Benjamin said that in that case, he has no choice but to find another contractor. Roger replied, "Don't we already have a contract between us?"

Explain whether there is a valid contract between Benjamin and Roger. In your answer,

you should identify and discuss the four (4) elements of a contract. (30 marks)

BUS201 Copyright 2020 Singapore University of Social Sciences (SUSS) Page 3 of 6 Timed Online Assignment - January Semester 2020

Question 2

Woody's Tables and Chairs ("WTC") is a furniture manufacturer and retailer and they have a number of retail shops in Singapore.

Desmond went to one of the retail shops of WTC and saw that some plywood chairs were on sale. He wanted to buy four chairs. Before Desmond made payment, the cashier brought the following clauses (which were printed on the sales invoice as part of a list of standard terms and conditions) to the attention of Desmond:

"14. The customer must check the products carefully before taking them out of the store.

15. Woody's Tables and Chairs will not be responsible for any injury, property damage or other losses that arise in connection with the use of our products."

When Desmond voiced his concerns about these clauses, and in particular Clause 15, the cashier told Desmond, "Don't worry, we won't need to refer to Clause 15 for your purchase!" The cashier then offered Desmond a further discount, and Desmond proceeded to buy the chairs. Unfortunately, after Desmond brought the chairs home and used them, one of the chairs broke causing Desmond to suffer a fall and fracture his hip. Desmond's watch was also damaged in the process. Desmond consulted an independent furniture expert who found that WTC was negligent in allowing poor quality plywood to be used in the manufacture of these chairs.

Apply the legal rules under the four (4) points relating to the enforceability of an exemption clause to analyse whether the exemption clause is valid and enforceable against Desmond in relation to (i) his hip injury, and (ii) the damage to his watch. (25 marks)

Question 3

Brekkie Food Company ("BFC") is a cafe that serves western-style breakfast meals throughout the day. They are a socially conscious enterprise and they employ employees who are differently abled. BFC obtains their raw materials from two main suppliers. They obtain their food ingredients from a supplier called Wholesome Foods ("WF"), and they obtain their environmentally friendly disposable cutlery from another supplier called Sustainable Foodware ("SF"). BFC has a separate contract with each of WF and SF for monthly supplies to be provided by them.

WF in turn obtains their agricultural produce from farmers in the United States. Unfortunately, there was a very bad drought recently that affected crops in those regions, and as a result, WF will not be able to deliver the usual contractual orders to BFC for the next two months.

BUS201 Copyright 2020 Singapore University of Social Sciences (SUSS) Page 4 of 6 Timed Online Assignment - January Semester 2020

SF faced a different set of problems. They had over-committed to various customers (i.e. they did not have enough stock to satisfy all their customer orders), and they were therefore unable to deliver their contractual order to BFC for the coming month. While SF could have cancelled their other customer contracts to fulfil their contractual order to BFC, SF chose not to do so.

1.(a)Examine the circumstances in the given scenario and explain if BFC's contracts with (i) WF and (ii) SF would be discharged by the doctrine of frustration. In your answer, please also briefly state the consequences of a contract that is discharged by frustration, under the Frustrated Contracts Act (Cap. 115). (20 marks)

2.(b)Assume that the contract between BFC and WF also contained the following Clause 8:

"In the event of any force majeure (including but not limited to heavy rainfall, droughts, hurricanes, and other weather extremities) that affects the supply of agricultural produce to Wholesome Foods, the contracting parties agree that Wholesome Foods shall not be held responsible for the non-performance of the contract due to such force majeure event. If the period of such non-performance does not exceed 100 days, the contracting parties' obligations shall resume to the extent possible after the force majeure event has ceased to operate. If the period of such non-performance exceeds 100 days, the contract shall be terminated."

Explain how Clause 8 would affect your analysis and answer to (a)(i) above.

(5 marks)

Question 4

Anson was recently hired by Global Swim Sales Pte Ltd ("GSS"), a company that sells swimming accessories. Anson's job responsibility was stated in his appointment letter as follows:

"You are appointed as an executive and tasked to explore business opportunities in China."

The Managing Director ("MD") of GSS wanted to send Anson on a business trip to China to meet with a potential business partner called Dora. Dora owns a chain of fashion outlets in China and was keen to carry the products of GSS. To facilitate this, GSS issued Anson with a "letter of introduction" using the company's letterhead. This letter describes Anson as the "Director of Sales" and states that he is authorised to represent GSS. The MD explained to Anson that this letter is "for optics only", as business parties in China place a lot of emphasis on job titles. The MD further informed Anson that it is GSS' policy that before agreeing to any business deal in China, Anson must seek the MD's approval first.

When Anson met with Dora in China, Dora was suitably impressed with Anson after reading the letter of introduction and seeing how well Anson carried himself. After negotiating for a while, Dora asked Anson, "Do we have a deal?" In a bid to clinch what he thought was a good deal, Anson replied, "Yes, absolutely!"

1.(a)Describe and explain two (2) ways in which the agency relationship between Anson and GSS could have arisen in the above scenario. Support your answer

with specific examples based on the above scenario. (18 marks)

2.(b)Discuss whether Anson has breached any duty as an agent. You are only required

to discuss one (1) duty that Anson may have breached. (2 marks)