Question
Rick operates a cartage service. Jake is in the business of supplying medical equipment to hospitals in Victoria. Jake enters a one-year contract with Rick
Rick operates a cartage service. Jake is in the business of supplying medical equipment to hospitals in Victoria. Jake enters a one-year contract with Rick for the delivery of equipment to hospitals. Jake signs (without reading) a standard form contract given by Rick. The contract contains the following terms:
Rick will pick up the equipment from Client's (Jake) factory in Melbourne and will drive to the designated hospital to drop off the equipment.
"All goods are transported at the owner's risk. Rick shall not be liable for any loss or damage to the Client's (Jake's) property howsoever such loss or damage may be caused."
On this occasion, Jake gets a call from Wodonga Hospital to supply a ventilator (machines used to treat COVID-19 and pneumonia patients) that is urgently required for a COVID-19 patient. Jake calls Rick and asks him to pick up the ventilator from his warehouse and deliver it to Wodonga Hospital. However, he does not disclose the urgency of delivery as on all past occasions Rick has been extremely quick in delivering the equipment.
Rick picks up the ventilator from Jake's warehouse in Melbourne and proceeds towards Hume Freeway (M31), which is the shortest route to the Wodonga area (see map below). On his way, Rick gets a call from his friend, Aslam, who invites him to stop by for a lunch at his kebab caf, next to Lake Nagambie, which is 50kms off the main highway (M31) to Wodonga. While Rick was enjoying kebab at Aslam's caf, a drunk driver hit his parked truck from behind. The truck topples and the ventilator is broken into pieces. Rick informs about the accident to Jake and the Wodonga Hospital. Jake is very upset as he had purchased the ventilator for $120,000 and had invoiced Wodonga Hospital $130,000 including the delivery fee.
Due to the failure in the supply of the ventilator on time, the Wodonga Hospital patient died. The hospital board members have decided not to give any equipment orders to Jake in the future. Jake used to make $50,000 annually from equipment orders from Wodonga Hospital. He is very disappointed and distressed as his annual income is halved and he will struggle to make mortgage repayments for the $2 million house that he has recently bought.Jake wants to sue Rick for all remedies that are available to him under contract law.
Advise Jake of the remedies, if any, he may have under the contract law. Cite relevant cases.
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