Question 2 (20 marks)

Jim Blonde is a former defence consultant who now works for Intelligent Sellutions Pty Ltd, a company that deals with modernising motor vehicles so that they can self drive. Jim is skilled in the area of artificial intelligence andautonomous vehicle technology, having worked in the area during his consultancy.

Intelligent Sellutions Pty Ltd has hired Tom Stone, a GPS navigation expert, to build a suitable navigation system that will allow autonomous cars to

safely navigate any road network. A written contract was signed

between the parties. Tom is a high achiever. He attended Massachusetts Institute of Technology (MIT) and

graduated with the highest honours at age 16. He knows almost everything relating to navigation science

and technology. He is a professional engineer and can craft any kind of navigation device. Tom is famous for

creating the intelligent navigation systems that are used in the new futuristic defence aircrafts.

LAW6000 Assessment 2 Case study analysis

Jim Blonde told Tom that it was essential that the navigation system was safe and that it should be able to

update itself for at least 5 years. He added that the system ought to work on marked roads and unmarked

roads. Tomreplied "All of ournavigation systems are intelligent and can be used all over the universe on

any terrain. We have it sorted. They will also update themselves for upto10 years." The two agreed on this

verbally and this statement was not incorporated into the written contract.

The cost of developing the navigation systemwas $500,000, to be paid in two instalments: at the start of the work and the balance on completion. Intelligent Sellutions paid $200,000 while the work was being carried out.

When Tom indicated that he had finished the work, Intelligent Sellutions ran some tests on the navigation system as soon as they received it. Jim Blonde installed it in one of the cars that they were working on and took it out for a drive. Immediately the car reached a busy unmarked road, the navigation system failed and the car stalled and would not move any further. As a result, Intelligent Sellutions refused to pay Tom, arguing that the navigation system was not safe and did not work according to their agreement.

REQUIRED:

With reference to relevant legal principles, use the IRAC legal problem-solving approach to advise Intelligent Sellutions of their common law rights against Tom Stone as they seek to rely on his assertions. Use appropriate case law in support of your answer.

(20 marks)