Examine the contracts

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Reference no: EM13995

Question 1

Select a real-life example of an employment agreement and describe the agreement for its conditions, warranties and innominate terms. In the description, please provide information on the industry in which the employer operates, the job title and the nature of the job to which the employment agreement relates.

You may preserve confidentiality by disguising the name of the organisation and employees.

Distinguish (a) a condition, (b) a warranty and (c) an innominate term from each other by describing one (1) example of each, which is found in the employment agreement. Analyse and explain your basis for identifying the three (3) clauses as a condition, warranty and innominate term respectively.

Identify and describe two (2) implied terms of the employment agreement and explain why they would be implied terms.

Question 2

Calvin recently bought a HDB flat that was situated right next to an expressway. The constant noise from the traffic and the wind was causing him sleepless nights. Hence, he decided to engage FixIt Pte Ltd to install double-glazed glass panes on all his windows at a price of SGD$100 per window. He was hoping that the double-glazing would reduce the noise from the expressway and also prevent the wind from coming into the flat.

Jerry, the boss of FixIt, came to inspect the windows before his team started work and issued an invoice for SGD$1,000 for 10 windows. Calvin decided to further negotiate the price and Jerry, anxious to close the deal, said, "Okay, we'll do it for a special price of SGD$800, payable upon completion of the works." At the same time, Calvin also engaged Door Expert Pte Ltd to install a heavy, reinforced wooden door with a thickness of 12 centimetres at the entrance of his flat as well as to the master bedroom. He was hoping that the thick, reinforced door would keep out the noise from outside. Door Expert asked for a deposit of SGD$500, with the balance of SGD$2,500 to be payable upon completion of the works.

Two weeks later, FixIt finished the double-glazing of the windows. Upon inspection of the windows, Calvin found that one of the 10 windows was not double-glazed and all of them still let in some wind. When he inspected the newly installed doors, he also realised that the thickness of the doors was only 11.5 centimetres.

FixIt agreed to double-glaze the remaining one window but insisted that the payment should be made for the nine windows that were double-glazed. As for Door Expert, it argued that the reinforced doors were indeed made of the high-quality wood and reinforced synthetic materials and did reduce the noise and hence, they should be paid the balance SGD$2,500.

Examine the contracts and explain to Calvin his rights and obligations under his contracts with FixIt and Door Expert.

Question 3

Sue and Dave have been friends for many years. Recently, they all decided to quit their jobs and set up a home renovation business together. Being a new and small start-up, they felt that there was no need for formal job titles and task allocations.

When the volume of business increased, they hired John to help manage projects. They told him that he needed their approval if he wished to sign any contract. Apart from that, however, they barely checked on him and talked to him only when deadlines for milestones were approaching.

One day, John was approached by Tina, a sales consultant from Verk Software. She wanted to introduce him to a new IT system that could integrate a customer relationship management (CRM) system with finance and accounting modules, computer-aided design (CAD) features as well as inventory and logistics management systems.

When Tina asked about the size of the company, John replied with a laugh, "There are only three of us here. The two shareholders and I." When asked about their job titles, John told Tina, "We don't believe in titles; we are empowered to do whatever is necessary."

After listening to Tina's presentation, John decided to buy the new IT software. On Wednesday, Tina sent him a contract stating the price of SGD$50,000. However, she had inaccurately calculated the costs and manpower resources required from her company to undertake this project. The actual price was meant to be SGD$75,000.

On Thursday afternoon, John signed the contract and sent it back to Tina, without seeking approval from Sue and Dave. On Friday morning, Tina realised her calculation errors and tried to call John's office. Sue picked up the phone and was shocked to hear from Tina that John had purchased the IT software without informing Dave or her. Sue stated that John had signed the contract without approval.

That afternoon, Tina prepared a new contract and sent it to Sue, with the adjusted pricing. Sue realised that the original contract was a good deal and called Tina on Saturday, stating that she ratified John's acceptance of the SGD$50,000 contract.

(a) Explain whether Verk Software is bound by the SGD$50,000 contract.

(b) Discuss the remedies which Verk Software and Sue's company may have against John.

Question 4

"Not all agreements are contracts. All contracts are agreements which bind parties to their promises."

(a) Do you agree with this statement? Provide reasons to support your view. In your analysis, discuss the elements of a valid contract and provide real-life examples of each element.

(b) Explain how the legal system (with a focus on the judiciary) can play a role in this context, within the business world.

Question 5

Mrs Rose lives alone in a big apartment and does not have any close friends since her husband passed away. She felt lonely and was thinking about her only daughter, Jewel, who rented a room near the polytechnic at which she was studying. Jewel shared the room with Rachel, who is 22 years old and works in an advertising agency.

Jewel rarely visited her mother as she was busy with her studies. Jewel is 17 years old and will be celebrating her 18th birthday in two months' time.

Jewel is prepared to stay with her mother and seeks your advice on her proposed actions in the following scenarios. In your advice, analyse whether Jewel is able to take such proposed actions and explain your reasons with supporting case law.

(a) Mrs. Rose contacted Jewel and requested that Jewel return to stay with her. The contract for Jewel's of the room is for 2 years with a remainder period of 6 months. Jewel would like to move back immediately and terminate the contract.

(b) Jewel had planned to have two celebrations.

The first celebration will be one month before her actual birthday. She had booked a hotel function room and paid a 10% deposit amounting to S$1,000.00.

The second celebration for her excellent examination results will be held 3 months after her birthday. She had paid a 10% deposit amounting to S$100.00 to book a special package with a cafeteria.

Mrs. Rose heard about the 2 celebrations and told Jewel to hold the celebrations in her apartment instead as there is enough space to accommodate all her friends. Jewel would like to cancel the first contract and seek refund of S$1,000.00.

As for the second contract, Jewel was undecided on its cancellation and may only decide after her birthday.

(c) Three month ago, Jewel borrowed S$1,200 from Rachel. She used the money to buy a new laptop to replace her faulty one. Rachel is now demanding immediate repayment of the S$1,200 when she heard that Jewel was moving back to stay with her mother. Jewel felt that she no longer needed the laptop and wanted to give the laptop to Rachel instead of returning the S$1,200.

In your analysis, assume that there are no issues relating to licensed money-lending.

(d) Soon after her exams, Jewel entered into a 2-year apprenticeship agreement with a visual artist, Max Tan. During the first month of work, Max Tan was extremely busy and did not provide any guidance to Jewel. Jewel was paid S$200.00 for the first month and she was not allowed to do work with any other companies. Jewel would like to set aside the contract and look for work elsewhere.

Question 6

Tony is the owner of 54 Cooks, a popular restaurant serving fusion food. He is the creator of the signature dish "Fiery Chicken" which has attracted many customers to his restaurant.
Joseph is the owner of a production company and has engaged Tony as a celebrity chef in a brand new programme entitled "Tony, the Fiery Master Chef". Joseph and Tony signed an agreement with the following clauses:

1. There shall be 5 episodes in the programme. Filming of all the 5 episodes shall be held in the premises of 54 Cooks.

2. Tony would be present in 5 press conferences organised by Joseph to promote the programme. Each press conference will be held before the screening of each episode on national television.

3. Tony agreed to share the secret recipe of the "Fiery Chicken" dish in the last episode of the programme.

The following events occurred after the agreement was signed:

(a) Tony missed the first press conference. He had diarrhoea the day before the press conference and was not well enough to attend the press conference. Joseph personally promoted the programme during the press conference.

(b) The first episode was filmed in 54 Cooks. The response to the programme was just average.

(c) Due to unforeseen circumstances, Tony over-slept and missed the second press conference. Joseph had to stand in again to promote the programme.

(d) During the filming of the second episode, a crew member of Joseph's production team who carried the video recorder fell. The video recorder was damaged and filming was delayed for a few days.

(e) Tony's assistant chef, Harry, who was jealous over Tony's success decided to share the secret recipe with Joseph. It was revealed that Tony used "Fire" brand chilli sauce which was easily available in the supermarkets.

Joseph wishes to terminate the contract. Advise him on his rights against Tony. In your advice:

(a) Explain the various clauses and determine the nature of each clause;

(b) Explain each event and discuss the legal impact of the occurrence of such an event; and

(c) Recognise the various remedies (if any) available to him and briefly discuss them.

Reference no: EM13995


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