QUESTIONS

Mary owns and runs a cupcake shop, and often sources ingredients from a business called Five Stars Flour. One day, she calls Five Stars Flour to ask about their almond flour. She speaks with Richard:

'Lots of my clients request gluten-free cupcakes', says Mary. 'Is your almond flour gluten-free?' 'Yes, of course,' Richard replies.

Mary agrees to order 50 kilograms of almond flour, and shortly after the conversation, Richard emails her an online order form with the type and amount of flour already entered. Mary fills out the rest of the online order form and submits it. The order form did not mention anything about the almond flour being gluten- free.

Mary uses the almond flour to bake cupcakes for the engagement party of Danny and Janet. Danny, who has coeliac disease, has a severe reaction to the cupcakes. It turns out that the almond flour used in the cupcakes was not gluten-free, as it had been processed and packaged with machinery also used for wheat flour.

Danny and Janet had not specifically requested gluten-free cupcakes when dealing with Mary, but they had asked for almond flour. They now want to sue her for breach of contract.

1. Was it a term of the contract between Mary and Five Stars Flour that the almond flour would be gluten free? (5 marks)
2. Was there an implied term in Danny and Janet's contract with Mary, that their engagement party cupcakes would be gluten-free? (6 marks)

After the complaint about Danny and Janet'scupcakes, Mary makes a sign to put up in her cupcake shop. She positions the sign on the wall next to the counter where customers are served.

Kym comes to Mary's shop to place orderfor cupcakes. They discuss all of the details: Kym orders 100 chocolate cupcakes covered with green and yellow coloured icing. While finalising the order Kym sees the sign, which says:We accept no responsibility for breach of any warranty.

Kym comes back a week later to collect and pay for the cupcakes. After leaving with the cupcakes Kym discovers that it has green and orange icing. This makes it inappropriate for the function she was planning to use it for-a sports team celebration. Kym wants to complain to Marybut isn't sure whether or not the signprevents her from doing so.

1. Was the icing colour a condition or a warranty of the contract? (3 marks)
2. Is Mary still responsible for the icing being the wrong colour onKym's cupcakes? (6 marks)