One Mr and Mrs Hoxha are elderly migrants from Albania aged in their eighties. Although they have lived in Australia for many years their English is very poor and they have little formal education. Mrs Hoxha answered a knock on the door one Sunday evening when Mr Hoxha was out. A smiling young man stood on the doorstep. "I am Stan and I would like to offer you a free service on your Sux vacuum cleaner!" he said. Mrs Hoxha shook her head and tried to close the door but Stan's foot was in the way. "Let me in, its free!" he said. Mrs Hoxha grudgingly stood aside as Stan bounded up the stairs. He paused to admire a photo of the grandchildren of whom Mrs Hoxha was very proud and she was happy to tell him in her halting English about all their achievements. Stan then explained with a concerned expression that an old vacuum cleaner might make the children sick when they came to visit which horrified Mrs Hoxha. He settled down on the couch and was still there some three hours later when the Mrs Hoxha wanted to go to bed. He produced a contract, telling her she had qualified for an upgrade from their old Sux vacuum cleaner. Mrs Hoxha was exhausted by this time and signed the contract in the hope that Stan would leave the house. The next day, the Hoxhas' daughter Anna came round and was shocked to discover her mother had signed a contract to purchase a new $4000 Sux vacuum cleaner. Required: Anna would like your advice as to whether the contract can be set aside. Refer to ss 20 and 21 of the Australian Consumer Law. Question Two Magnus employs sales staff who travel from door to door selling Magnus handsets. Magnus's contracts are designed so that customers 'lease' the hand set for $150 a month for 24 months. Term 10 provides: "if a monthly payment is not made within 5 days of its due date, the customer will incur a $700 late administration fee which fee will accrue by $20 a day for each day the monthly payment and the late administration fee remain unpaid". You have signed the contract. After 8 months of making timely payments you lose your job and cannot pay the July monthly $150 payment. After two weeks Magnus start phoning you insisting you owe them $1130 which amount is increasing each day it remains unpaid. Required: Apply s 23 to determine whether you might avoid having to pay this amount Question Three Magnus have been now trading for a number of years and are now incorporated as a company. Magnus, advertises its new smart phone as "having coverage all over the world". It in fact only has coverage in locations with adequate mobile network. Required: On what basis (if any) has Magnus breached the Australian Consumer Law? Question Four You need a home computer to assist you with your studies at RMIT. After shopping around, you purchase a computer at Rick Smith for $2000. One month later the computer screen starts freezing and then the computer turns itself off. The fault is not caused by a computer virus but is a problem with the actual computer. You return to Rick Smith and tell them you want your computer replaced. Required: On what grounds if any, would Rick Smith be required to replace the computer? Refer to relevant legislation in your answer. Question Five Kevin bought a new TV from eWorld superstore on the basis of the salesman, Tim's recommendation. The machine had been manufactured overseas and imported by Global Warehouse Pty Ltd ('GW'). After six months of satisfactory operation, the TV developed serious faults and required extensive repairs. eWorld has denied responsibility on the grounds of a term of the contract, signed by Tim, which stated: 'It is expressly agreed that the only conditions or warranties expressed or implied which apply to the contract are those resulting from the warranty issued by the importer.' The warranty which came with the machine read: 'The importer shall repair any defects in the TV up to a period of three months from the date of purchase. All other conditions and warranties are expressly excluded.' The importer, Global Warehouse Pty Ltd has denied responsibility on the basis of the warranty. Required: Assess Tim's legal position and advise him of what action he should take, if any, under national legislation against eWorld and/or Global Warehouse Pty Ltd under the ACL. Question Six You have just started your marketing business trading as a sole trader. You want to fit out the premises you have leased. You discuss with a reputable interior designer that you would like the premises fitted with the retro fixtures you have purchased. You agree the cost of the fit out will be $1,000. The interior designer affixes light fittings to the ceilings but does not attach them securely. Consequently two light fittings fall to the ground and smash. The light fittings were valued at $2,000. Required: Do you have any legal action against the interior designer under the Australian Consumer Law? Question Seven Annie gave her son Ted an EasyRide Scooter. Ted was thrilled and took it for a ride it along the footpath. Unfortunately one of the front wheels was faulty and fell off. Consequently, Ted flew off the scooter and banged his head on a pole, knocking out two of his teeth. Annie had to take time off work to look after Ted while he recovered in hospital. The scooter was assembled by ToysRToys Pty Ltd ('TRT') in Australia, however many of the components were sourced from overseas. Investigations have established that the faulty wheel was defective because of a faulty ball bearing which was made in South Korea. Required: Advise whether Annie and Ted are entitled to any remedies under the ACL