Referencing

Wherever possible, relevant authorities (such as cases and/or legislation) should be included as part of

your answers and referred to in support of your statements and assertions. Appropriate referencing of

such authorities in your answer can contribute to the marks you receive for a question.

1

LAWS 1018 Business Law Assignment April 2021

Your written work should use the referencing styles set out in the Harvard Referencing Guide - user

friendly or the Australian Guide to Legal Citation, published by the Melbourne University Law Review

Association (for which there is a link on the Business Law Moodle course site). These are listed on the

Portal for Business Law.

Instructions

Read the following factual accounts and answer ALL of the questions with reference to the

principles of law covered in the following lectures:

Topic 6: Australian Consumer Law

Topic 7(1): Contract Law - Part 1

Question 3

Jasmin was a passionate about the healing power of natural therapies, and so enrolled in a 12-

month full-time Diploma of Natural Health course offered by 'House of Herbs', a popular health

foods franchise. While she was studying the diploma Jasmin also worked 6 evenings each week

as a petrol station attendant in order to earn sufficient money to support herself and pay for the

$20,000 course fees.

Despite her demanding work schedule at the petrol station Jasmin was still able to achieve

excellent results for her assessments in the diploma and her instructors were impressed with her

positive work ethic.

One day while she was browsing in 'Flower Power', a nursery that specialises in selling herbs, she

talked to the manager about her interest in natural therapies. The manager was so impressed

with her knowledge and enthusiasm that he offered her a full-time position as a sales assistant at

Flower Power. Jasmin was very interested in this offer, as it would give her practical experience

in the cultivation and use of the healing power of herbs.

Furthermore, although Jasmin was enjoying her diploma course immensely at the House of

Herbs, the long hours that she was forced to work at the petrol station in order to support

herself was starting to affect her health. Therefore she decided it would be best for her to leave

the diploma course at 'House of Herbs' and take up the sales assistant position she was offered

at 'Flower Power'. LAWS 1018 Business Law Assignment April 2021

5

When Jasmin told the principal of 'House of Herbs' that she was thinking about discontinuing her

studies for financial reasons, the principal told her that since she was a good student with a

promising future she need now only pay half of the remaining fees for the course. This meant

that Jasmin would not have to work as many shifts at the petrol station and would still be able to

complete her diploma, so she readily accepted. Jasmin therefore decided to continue studying

the diploma at the House of Herbs until the end of the course and did not accept the offer to

work as a sales assistant at 'Flower Power'.

Shortly after finally completing all of the study for the diploma course Jasmin received an account

from House of Herbs in which it claimed 9 months arrears in fees for the period of time for which

she had only paid half of the fees. Jasmin was shocked to receive this, and contacted the

accounts officer, who then informed her that she would not receive her diploma until the arrears

had been paid in full.

When she protested that she was told by the principal that she was only required to pay half

fees, the accounts officer said that a special arrangement like that was made only in exceptional

cases of hardship for unemployed students, and this did not apply to Jasmin. Instead the

accounts officer said that what House of Herbs had given Jasmin was just a 'loan agreement' for

the payment of the fees, and she now had to repay the loan in full.

The accounts officer further informed Jasmin that, if she refused to pay the outstanding amount

still owing of $10,000, the 'House of Herbs' would also have no choice but to initiate a civil claims

action against her in the Magistrates Court to enforce her payment of this amount. They would

also ask the court to make orders that Jasmin would also have to pay their legal costs.

Jasmin would have discontinued her diploma and taken up the sales assistant position at 'Flower

Power' if she had known that the arrangement with 'House of Herbs' to pay half fees was in fact

just a 'loan agreement'. Jasmin now does not have enough money to pay the amount demanded

by House of Herbs since she barely earns enough to support herself, and instead she says that

the 'House of Herbs' has treated her unfairly.

(7)

Advise Jasmin whether or not she is legally bound to pay 'House of Herbs' the amount

they have demanded by using the legal principles found in the following:

(a) the common law requirements for consideration in contracts;

[3 marks]

and alternatively:

(b) the Doctrine of Promissory Estoppel,

[4 marks]