ACTY 5320 Law of Business Obligations

School of Applied Business
Bachelor of Business

ACTY 5320 Law of Business Obligations
Semester One 2019
Final Examination

Date:Monday 17 June 2019
Start time:2:00pm
Time allowed:3 hours, plus 10 minutes reading time
Total marks:100 marks
Weighting:50% of course
Instructions:Answer ALL questions.
Answer the questions directly in the answer booklet provided.
Read each question carefully.
Answer only what is asked for.
Please write clearly.
Summary of paper:TopicTypeMarks
Consumer Guarantees ActApplication (ILAC)20
Real and Personal PropertyShort answers20
Intellectual PropertyShort answers20
Contract and Commercial
Law Act
Short Answers20
AgencyShort answers20

ACTY 5320 Law of Business Obligations
Final Examination
Semester One 2019
Page 2
Question 1 20 marks
Consumer Guarantees Act 1993
Short Answers and Application (ILAC) question
Fact Scenario
Tobias is an avid collector of model airplane. His more expensive collections are kept in a sealed
display cabinet with the moisture and temperature inside automatically controlled by a specialised
air conditioning (AC) unit that was supplied and installed by Temperature Action Ltd.
Recently Tobias has acquired a set of extremely rare 1930s model airplanes and is due to receive
them in a few weeks time. In order to prepare for the arrival of the new models, Tobias ordered a
much bigger display cabinet and again wanted Temperature Action Ltd to supply and install a
new AC unit.
Tobias called Josh, the General Manager of Temperature Action Ltd and told him that:
1. He has a new display cabinet twice the size of the existing one;
2. The new AC unit needs to maintain exact temperature and moisture in the cabinet
3. He required Temperature Action Ltd to send over the best installer for the job;
Josh responded to Tobias:
1. They will provide a German made air conditioning unit that is used for high end museums
and will be perfect for Tobias’ cabinet;
2. They will send him the best installer for the job;
Happy with Josh’s response, Tobias decided to have the installation take place three days later.
Three days later, Tobias opened the door to a young man wearing Temperature Action Ltd’s
uniform. He identified himself as Andrew and he said was here to install the AC unit. Tobias
thought Andrew looked somewhat young but believed it should be fine as Josh promised him that
they would send their best installer. After showing Andrew the display cabinet, Tobias went out
to pick up the model airplanes.
Tobias came home about 4 hours later and he saw that Andrew has completed the installation
and everything seemed to be working. He then put all his expensive models into the display
About one-week later Tobias discovered that some of his model airplanes have started to rust.
Even worse, when he picked up one of the 1930s model for a closer inspection, it broke in half
due to rusting. It seems that heavy moisture has built up in the cabinet and caused the problems.
Tobias immediately called an independent AC technician who came over and reported the
following issues:
1. The sensors for the AC wasn’t installed correctly and so the AC didn’t work properly;
2. Even if it did work properly, the AC unit isn’t designed to handle a display cabinet of this
3. The AC unit is made in a developing country and not Germany;
ACTY 5320 Law of Business Obligations
Final Examination
Semester One 2019
Page 3
After examining the damage to his models, Tobias estimates that he has suffered at least $15,000
in damages. Tobias called Josh who admitted that their best installer was sick on the day of the
installation and they had no choice but to send Andrew who was new.
1. Advise Tobias what section(s) of the Consumer Guarantees Act has Temperature Action
Ltd breached and what remedy are available?
Answer the above question using the ILAC system
[20 marks]
ACTY 5320 Law of Business Obligations
Final Examination
Semester One 2019
Page 4
Question 2 20 marks

Real and Personal Property
Short answers

2.1 Describe briefly what the difference is between Real Property and Personal Property
and provide two examples of both.
[5 marks]
2.2 With reference to relevant section(s) from the Personal Property Securities Act, identify
how perfection occurs and what perfection determines.
[5 marks]
Fact Scenario
2.3 Tom discovered that his best friend James was selling his mother Jenny’s house on her
behalf for a really good price. Tom got in touch with James and agreed to purchase the
house. After Tom completed settlement and title to the property has been transferred to
him, it was discovered that James had forged his mother’s signature on all the documents.
2.3.1 With reference to the relevant section(s) from the Land Transfer Act 2017 and
cases, explain whether Jenny can regain title to her house;
[4 marks]
2.3.2 If the following had took place, could Jenny regain title to her house?
1. The price of the house was 30% below market valuation;
2. James did not use a real estate agent;
3. Settlement and the transfer of title was 3 days after the contract was signed;
4. When Tom asked to speak with Jenny, James told him that it was better he
knows less;
Refer to the relevant section(s) from the Land Transfer Act 2017 and cases in your
[6 marks]
ACTY 5320 Law of Business Obligations
Final Examination
Semester One 2019
Page 5
Question 3 20 marks
Intellectual Property Short answers
Answer the following questions referring to relevant sections in any relevant statute.
3.1 Fact Scenario 1
Chariot Beer Ltd, a local microbrew wants to launch a new line of beer and wanted new bottles
for their beer. They asked Dante, a local glassmaker to come up with a new bottle that would
have engraving of chariots designed by Chariot Beer Ltd on the side of the bottle.
3.1.1 What kind of intellectual property is the engraving of chariots on the bottle? [2 marks]
3.1.2 Who is the owner of this intellectual property? [2 marks]
3.1.3 List two methods that Chariot Beer Ltd can protect this intellectual property. [6 marks]
3.2 Fact Scenario 2
Jason is a budding musician who uploads his original music onto YouTube. Recently one of his
songs have become super popular and have received over 3 million views in two weeks.
Yesterday, he saw his song has been used by Z Electronics Ltd in an advertisement to promote
its chain of electronic stores, without his knowledge nor permission.
3.2.1 What remedies are available to Jason? List at least two. [2 marks]
3.2.2 Under what circumstances can the director of the Z Electronics Ltd be held criminally
liable? Refer to the relevant section(s) of the Copyright Act 1994.
[2 marks]
3.3 Patent Act
3.3 With reference to relevant section(s) from the Patents Act 2013, what are the three
requirements of a patentable invention?
[6 marks]
ACTY 5320 Law of Business Obligations
Final Examination
Semester One 2019
Page 6
Question 4 20 marks
Contract and Commercial Law Act 2017 (Sale of Goods)
Short Answers
Fact Scenario
Christina owns a pottery store on Ponsonby Rd called Creative Pottery which specialise in highgrade custom-made cups and plates. She has an arrangement with Passion Ceramic
Collective, a group of artisans who specialise in pottery and glassware. On the first Monday of
every month, they would send a shipment containing 200 of their products to Christina. She would
pick at least 25% of the shipment and sell them in her store while returning the rest of the stock.
Once Christina has selected the products, she is invoiced by Passion Ceramic a week later.
Christina has a very good relationship with Deon, the head manager of La Grenouille, a high-end
French restaurant in Ponsonby. Deon wanted to update the tableware of La Grenouille with
Christina’s products however she did not have the stock available. After hearing about Christina’s
arrangement with the Passion Ceramic, he placed an order with Christina for 30 cups and 30
plates from the next shipment and paid her a deposit.
On the next delivery date, Deon went to Christina’s store to pick up his order. He saw the
deliveryman for Passion Ceramic unloading the shipment, but Christina has not arrived yet. Deon
decided to look through the shipment himself and picked out 30 cups and 30 plates which he
intended to purchase and had them set aside.
A few minutes later Dirk, a tourist from Holland who was riding a bicycle down Ponsonby Rd on
the sidewalk turned the corner and smashed into the boxes containing the 30 cups and 30 plates
that Deon have selected. Luckily Dirk was unharmed but all of the pottery that have been set
aside by Deon were either destroyed or heavily damaged. It was clear that Dirk was at fault and
would be liable for the damage he caused.
4.1 Who have the right make a claim against Dirk for the damaged pottery? Explain your
answer and refer to relevant sections of the Contract and Commercial Law Act 2017.
[10 marks]

4.2Identify the following as “sale”, “agreement to sell”, or “neither”:
4.2.1 Jason buying 1 block of chocolate from the local dairy.

[2 marks]
4.2.2 Amanda ordering a bouquet of flowers for her mother online.
[2 marks]
4.2.3 Brendan getting a second-hand lawnmower from Julie after agreeing to cut her
ACTY 5320 Law of Business Obligations
Final Examination
Semester One 2019
Page 7
grass for a year.
[2 marks]
4.2.4 Jacob placing an order for a 2020 Tesla Model X vehicle.
[2 marks]
4.2.5 Jennifer receiving a ring from her grandmother as a gift.
[2 marks]
ACTY 5320 Law of Business Obligations
Final Examination
Semester One 2019
Page 8
Question 5 20 marks

AgencyShort answers

5.1 What happens when an agent acts outside of the authority they are given?
[6 marks]
5.2 What implied duty of the Agent is discussed in the case of Felthouse v Bindley (1862)
142 ER 1037
[3 marks]
5.3 What implied duty of the Agent is discussed in the case of De Bussche v Alt (1878) 8 Ch
D 286 (CA)
[3 marks]
Fact Scenario
5.4 Cindy is a partner of the law firm Fidelity Law. She signed a contract with Ricoh where
they supplied Fidelity Law with 10 large printers and a two years service contract.
5.4.1 Identify an agency that is established in the above scenario. [4 marks]
5.4.2 If Cindy leaves Fidelity Law but she is still listed on their website as a Partner after
several months, what kind of agency could this create?
[4 marks]

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