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Business Law Assignment: Case Analysis of Guildford Limited

Question

Task: You have secured a role as a volunteer with the ‘Guildford Consumer Business and Advice Services’ (GCBAS), which is a charitable general advice service staffed by tutors and students from surrounding Higher Educational establishments.

The role of GCBAS is to provide legal support and other advice, free of charge, to both the public and local businesses. As a volunteer, your role is to undertake research on the cases detailed below, so as to provide the appropriate legal advice to GCBAS.

Casework 01
Paul who wanted to buy a motorbike after passing his recent test, saw an advert in the local paper, placed by ‘Rage Secondhand Motorcycles of Guildford Limited’, giving details of the motorbikes that they had for sale at their Guildford showroom. One of the motorbikes was described as ‘2019 Magnet Road Interceptor, Red Chrome, 250cc - £2500’. Paul thought that the motorbike sounded just right for him.

After reading the local paper, Paul visited the showroom and enquired about the ‘2019 Magnet Road Interceptor’. During the course of conversation, the motorbike showroom manager confirmed the details given in the advert. Paul bought the motorbike, paying in cash.

Before Paul left the showroom, the manager suggested that with his new acquisition, he might want to join the ‘Magnet Road Interceptor Motorbike Club’. He gave Paul the application form and informed him that if he sent his details along with the membership fee within 14 days of purchase to the Motorbike Club, he would be entitled to a free new ‘state of the art’ alarm to protect the motorbike from possible theft. The next day Paul completed his application form for the ‘Magnet Road Interceptor Motorbike Club’, wrote a cheque for the membership fee and placed both the form and the cheque into an envelope addressed to the Motorbike Club. He then made his way to the local post box, when he saw Sophie his regular postwoman. Paul asked Sophie if she could take the letter from him to save time. She agreed.

Seven days later, the motorbike started to make a strange noise and suddenly came to an abrupt halt throwing Paul from the motorcycle and into a ditch. Paul received hospital treatment for cuts and a broken arm.

Paul took the motorbike to a specialist independent vehicle inspector for a mechanical opinion. The inspector confirmed that the motorbike needed a new engine manifold and new rear suspension. He went on to state that the motorbike showed hidden cracks within the subframe which as a result made the motorbike both dangerous and unroadworthy and was probably responsible for his recent accident.

One month after completing the ‘Magnet Road Interceptor Motorbike Club’ application form, Paul decided to contact the Club as he had not received any news surrounding his recent application. Following a telephone call to the ‘Magnet Road Interceptor Motorbike Club’, it was stated that they had not received his recent application and therefore he would not be entitled to any membership or free alarm. Paul seeks advice from GCBAS for any legal remedy surrounding the purchase of the motorbike and matters surrounding the membership application.

Casework 02
Jennifer is 28 years old and works for ‘Guildford Computer Coders Are Us’ (‘GCCAU’) which employs 76 staff.

The company specialises in the website design and programme coding for local business and schools.
As a consequence of the increased requirement to develop websites due to the Covid-19 pandemic, GCCAU has been under significant pressure to turn all work around quickly. Jennifer, who is a leading software coder, has worked for the firm for the past three years. Unfortunately, Jennifer has been absent from work through sickness on a number of occasions over the last three months.

During her last illness, Jennifer was absent for four weeks and came back for only two days before she was off work again.
Phillip, Jennifer’s team manager, was concerned about Jennifer’s lack of commitment to the company and the extent to which the software coding team’s efforts to oversee the new business have been disrupted by her continuous absence.

Last week, Phillip called Jennifer to a meeting, at which he expressed his concerns about the number of absences and their effect on the software team. During the meeting, Jennifer informed Phillip that she was pregnant and that she had consulted her Doctor and provided the appropriate documentation for each of the absences. In addition, Jennifer also stated that she had contacted the GCCAU Human Resources Department, to inform them that some of the absenteeism was related to her pregnancy. Phillip replied that he was sympathetic, however, he informed Jennifer that he would now closely monitor any further absenteeism.

Over the next month Jennifer did not take any further sick leave. During the weekly general team briefing to staff at the beginning of March 2021, Phillip made a number of derogatory remarks surrounding Jennifer’s absenteeism. Jennifer thinks that she is being victimised and bullied by Phillip and is now seeking advice from GCBAS as to her legal position surrounding her employment.

Casework 03
Mr and Mrs Williams wanted to install a new kitchen in their recently acquired detached property located in the heart of Guildford.

Mr Williams, who has been qualified electrician for the past twenty years had decided to complete the renovation himself and arranged for a locally registered plumber to complete all the necessary plumbing work within the kitchen.

The couple had seen some new kitchen units they thought would be suitable on the ‘Kitchens Deluxe of Guildford Limited’ website. They later visited the local branch located upon Guildford high street, in order to purchase the kitchen units they had decided upon.

Mr and Mrs Williams also needed a new dishwasher for the kitchen and asked the sales assistant which one he would recommend, after describing to him the layout and design of the kitchen. The shop assistant showed them a range of dishwashers and recommended the ‘DW Elite 2021 Kitchen Dishwasher’, which was marked as being ‘end of line design, heavily discounted and no refunds’.

Mrs Williams examined the unit and decided that this should be more than suitable from the advice given.

After much deliberation, Mr and Mrs Williams purchased a set of kitchen units, and the ‘DW Elite 2021 Kitchen Dishwasher’. Three weeks later, the goods were delivered to their Guildford property.
Mr Williams began to install the differing kitchen units and discovered that the shelves supplied to the kitchen unit cupboards were the wrong size and did not match the identified units as purchased. In addition, upon installation of the ‘DW Elite 2021 kitchen Dishwasher’, the local plumber who was engaged by the couple to fit the dishwasher into the kitchen suffered an electric shock as hidden internal wiring within the dishwasher was frayed and this subsequently caused the main circuit board to melt and malfunction when the device was connected to the mains electricity.

Mr Williams went back ‘Kitchens Deluxe of Guildford Limited’ to complain about the purchased goods. However, the shop manager stated that all the goods left the ‘Kitchens Deluxe Warehouse’ in good condition and that any issues should be taken up with the manufacturer. Turning to the kitchen units, the shop would be prepared to change the unit shelves, but only if the goods have not been opened or unpacked. Mr and Mrs Williams have decided to seek advice from GCBAS as to their legal position regarding this matter.

Casework 04
Henry and Louisa own and run an organic food and cosmetic centre called ‘Essence of Organic Life Within Guildford’. The couple sell both organic food and cosmetics upon their premises. In addition to the products produced on site, Henry and Louisa use the services of Amanda, who produces a wide range of natural ingredients cosmetic products. Three weeks ago, the business launched a new range of organic cosmetic beauty products. Both Henry and Louisa called upon the services of Amanda who produced the ‘All Organic Deep Cleanse Cleaner’ and the ‘Anti-Wrinkle Life Cream’ products, all of which were immediately placed on sale to the public.

Last week, Maria went to ‘Essence of Organic Life Within Guildford’ and purchased a bottle of ‘All Organic Deep Cleanse Cleaner’ and the ‘Anti-Wrinkle Life Cream’. Maria, give the purchased ‘Anti-Wrinkle Life Cream’ to her best friend Sandra as a birthday present.

Later that week, having fully read the application requirements for the ‘All Organic Deep Cleanse Cleaner’, Maria applied the solution to her legs. Shortly after the application, Maria felt an immediate burning sensation and noticed that both legs exhibited a large number of very painful red blotches.

Following a visit to the local hospital, Maria was provided a full medical and toxicology report surrounding her injury, which evidenced that the ‘All Organic Deep Cleanse Cleaner’ contained a form of acidic toxic content, which if applied to the skin would cause immediate burning and discomfort. Unfortunately, in the same week, Maria received an email from Sandra who also suffered acute skin burns when using the ‘Anti-Wrinkle Life Cream’.

Both Maria and Sandra have made a full recovery and has instructed legal proceedings against ‘Essence of Organic Life Within Guildford’. Henry and Louisa are now seeking assistance from GCBAS, as they need to know what their legal position is and what liabilities may arise in these circumstances. Tasks: Having completed your research on the above problems/casework, you are now required to write a report on business law assignment addressing a legal resolve upon ALL FOUR of the presented ‘Casework Questions’.

Your report on each of the cases should include the following: a) An explanation of the applicable law, citing relevant statutory provisions and supportive case law.
b) An explanation of how the law and applicable legal principles applies in each particular situation.

c) Advice on whether any legal action could be taken in relation to the case and an assessment of the likely outcomes of the applied legal action.

Answer

Business Law Assignment Casework 01
Issue

  • Whether Paul is entitled to seek any remedy against the damages suffered by him due to using the motorbike against Rage Second hand Motorcycles of Guildford Limited?
  • Whether Rage Second hand Motorcycles of Guildford Limited are liable to pay any damages to the losses incurred by Paul suffered from the accident?

Rule
The Consumer protection Act, 1987 introduced the aspect of statutory liability in regard to products that are defective in nature . Under the said legislation, a claim for damages can be instituted on occasion of occurrence of any death, personal injury or any nature of damage accruing to private property against the wrong doer.

U/s. 1(2) of the Consumer Protection Act, 1987, definition of the term “producer” has been enumerated. It defines that the term “producer” in regard to any product shall circumscribe within its ambit:

  • Any individual manufacturing the said product
  • Circumstances where any product that has not been manufactured, but has been won or abstracted by any individual .
  • Products that has not been manufactured neither, won or abstracted but contains certain essential characteristics that directs towards the prevalence of any industrial or alike processes been carried, then the individual carrying out any such process shall be deemed to be a producer of the same.

As EU Product Liability Directive, the CPA, 1987 entrusts a strict liability upon the producer of any product that might have resulted into any damage caused due to the presence of any defects within the product . This further state that it is not necessary for the claimant to prove or establish any fault on the part of the producer rather. So, for succeeding in a claim on the part of the producer the claimant is required to prove:

  • There already existed some defects in the product thereby rendering it overall defective.
  • The claimant has suffered certain serious degrees of damage .
  • There exists a link of causation between the defect and the damage incurred by the claimant. In Howmet Ltd v Economy Drives Ltd [2016] it was declared by the court that already existence of the consumer’s knowledge in relation to the defect in the product prior to the occurrence of any injury or damage can be used as a reasonable ground of defence in exclusion of any liability by the manufacturer .

Sec. 3 of the CPA, 1987 expressly states meaning of the term “defect”. The provision enumerates that:

  • A product shall be deemed to be defective if the safety of the said product does not match up to the standard that shall be expected by persons of general or ordinary prudence . In order to ascertain this, certain specific circumstances that are required to be taken into consideration involves:
  • The manner of marketing, packaging of the product, along with the purposes for which it shall be used.
  • Inclusion of any mark, instruction or warning in relation to doing or restraining certain things that shall not be carried out with the product .
  • The reasonably expected thing that shall be carried out with the product,
  • The time when the producer shall have supplied the product to another individual . Wilkes v. DePuy International Ltd [2016]

Contract law principles

  • Formation of a valid contract takes place through fulfilment of three basic elements which involves:
  • Agreement
  • Intention of establishing contractual relations
  • Consideration
  • An agreement shall be further divided under two segments offer and acceptance.
  • An offer is described as an objective manifestation of the desire or willingness of the offeror to be bound by the terms offered, on receiving acceptance by the offeree.
  • Acceptance is the unqualified statement of acceptance by the offeree to the terms and conditions of the offer .
  • An acceptance shall only be valid if the same has been communicated to the offeror.
  • In regard to postal acceptance, the general rule suggests that the process of communication of acceptance shall be competed when the letter has been posted, irrespective of the fact that the same has got lost, destroyed or delayed . Adams v Lindsell [1818] Application
  • Here, Paul after going through the advertisement posted by Rage Second hand Motorcycles of Guildford Limited, he arrived at the showroom and purchased ‘2019 Magnet Road Interceptor at the offered price £2500.
  • All the details in regard to the bike purchased by Paul was already given by the showroom in their advert.
  • Based on such description, Paul purchased the bike but soon after a week of purchase the motorbike started to make strange noises and abruptly came to halt in the road thereby leading to occurrence of an accident by Paul.
  • This suggests that as per the above mentioned description of the term “producer”, the concerned showroom are covered as they might not have manufactured the product but they have abstracted the motorbikes for business purpose of selling.
  • Apart from this, the consumer or Paul of the mentioned motorbike was not at all aware of any such defect present due to which he faced accident and suffered serious injuries.
  • Moreover under the mentioned contractual principles, Paul has completed the application form along with a cheque of membership fee for the ‘Magnet Road Interceptor Motorbike Club” and rendered his letter of acceptance to the regular postman Sophie. As per the rule of postal acceptance, here Paul’s letter of acceptance is valid, although it did not reach the club.

Conclusion
Therefore, Paul is entitled to bring a claim for damages or compensation under the CPA, 1987 against Rage Second hand Motorcycles of Guildford Limited for rendering defective product due to which he has to suffer such grave physical injuries. Apart from this, in regard to membership application, Paul is entitled to the membership as well as the free alarm as has been mentioned by the showroom because the letter of acceptance has been already posted by Paul. Therefore based on terms of the application, the showroom is liable to provide all necessary facilities of the club to Paul.

Coursework 2
Issue

  • Whether Philip’s conducts towards Jennifer, amounts to be victimisation and derogatory?
  • Whether Jennifer is entitled to claim any damages against Philip based on his conduct?

Rule
Under the Equality Act, 2010, protection is granted to the people of Britain against any sort of conducts that tantamount to discrimination, harassment and victimisation . Within the purview of the said legislation, express mentioning of nine protected characteristics has been carried out u/s. 4. This involves:

  • Age of the individual
  • Any form of disability faced
  • Individuals undergoing process of gender reassignment
  • Married individuals and individuals engaged in civil partnership
  • Individual facing pregnancy and maternity
  • Race
  • Religious faiths and beliefs
  • Sex of the individual;
  • Individuals undertaking the process of sexual orientation

Sec. 13 of the EA, 2010, provision relating to restriction on exercising of any direct discrimination has been enumerated . Commission of an act of direct discrimination shall take place if the employer engages in conducts based on protected characteristics which involve:

  • Exercises favourability in an unfair manner against any person or individual.Hainsworth v Ministry of Defence [2014]
  • Denial of the necessary access to any training, transfer or promotion.Amnesty International v Ahmed [2010]
  • Providing an employee with conditions of employment that amounts to be less favourable in comparison to that of others .
  • Restricting an employee in gaining benefits arising out of the process of employment.
  • Dismissing employees or undertaking an act of redundancy against them.

Sec. 26 of the EA, 2010 mentions about the provision governing conducts relating to harassment. This particular provision is applicable to all the protected characteristics except marital and civil partnership along with pregnancy and maternity . A person shall be deduced to conduct the act of harassment under circumstances:

  • Where the person engages in any conduct of unwanted nature incidental to the protected characteristic of the other
  • Undertakes any conduct that amounts to violate the dignity of the individual
  • Creates an environment of intimidation, hostile, humiliation, and other degraded factors.
  • Engages in any conduct of sexual nature that is unwanted and offensive for the other party .

Similar provision has been enlisted under Sec. 40 as well, where an employer is prohibited from undertaking any act of harassment against any employee in regard to the employment.

Application

  • Here Jennifer has been working for “Guilford Computer Coders Are Us for the past 3 yrs and has thereby acquired the position of leading software coder.
  • But due to her illness occurring from conceiving she has not been able to contribute in her best way and has taken leaves for the same.
  • Although she has submitted all the necessary documents that shall be appropriate to evidence her absence and that her employer is completely prohibited under the EA, 2010 to exhibit any form of discrimination towards her.
  • Despite of such valid explanation for the leaves, Jennifer had to face large number of derogatory remarks in relation to her absenteeism. Under the list of protected characteristic of sex, Philip’s such conduct against Jennifer can be categorised as discriminatory.
  • Moreover as per Sec. 26 of the EA, 2010, such complained conducts on the part of Philip can be considered to be acts of harassment as it further created a hostile work environment for Jennifer.

Conclusion
Therefore it can be construed that the conducts on the part of Philip does amounts to violating of the above mentioned provisions in relation to discriminatory treatments mentioned under the EA, 2010. This makes Jennifer to institute a civil claim of compensation against Guildford Computer Coders Are Us’ (‘GCCAU’) as she has been harassed and bullied by one of their employee Philip.

Coursework 3
Issue

  • Whether Mr. And Mrs. Williams are entitled to take any actions defective and wrong kitchen units delivered to them by Kitchens Deluxe of Guildford Limited?

Rule
Under the Consumer Rights Act, 2015, Sec. 2 defines the term “consumer” as any individual who is moving or acting towards purposes that are considered to be wholly or partially outside the purview of the concerned individual’s trade, business or the profession. Sec. 9 of the CRA, 2015, states about provisions governing delivery of goods that are of satisfactory quality. Elements to be considered for ascertaining whether the goods are satisfactory or not includes:

  • Whether the goods description provided is in conformity to the standard acceptable to any reasonable person,
  • The price or other consideration related to the goods are reasonable enough for a person with ordinary prudence
  • Any other circumstances in relation to the good that amounts to be reasonable enough. Sec. 10 of the concerned Act mentions about provisions relating to the fact that the goods supplied to the consumers are fit to its use if the same has been mentioned prior to contracting by consumer to the trader. As per the said section:
  • Any such contracts of sale shall be implied to include the term that such goods are reasonably fit for the purpose for which it is supplied.
  • Under certain circumstances, application of this provision shall not be made if relying of the consumer upon a trader’s judgment amounts to be unreasonable. Sec. 13 of the CRA, 2015, states about matching of the goods supplied as per the sample. Under this provision it is necessary for the supplier:
  • Under circumstances of supplying goods based on the sample seen by the consumers prior to entering into such contract, to showcase that the goods will match to the sample seen by the customers.
  • The goods supplied to the customer shall be free from any defect which shall render its quality to be unsatisfactory in nature through undertaking of all reasonable examination.

Sec. 14 states about matching of goods to any model seen or examined
Under this provision, any contract of supply of good that has been entered upon by the consumer in reference to a model that has been seen and examined, is required to include the term that good supplied shall completely match with the model seen. Apart from this if there exists any difference between the good to be supplied and the model, the same should be expressly brought to the attention of the consumer before entering into the contract.

Application

  • Mr. And Mrs. Williams decided to purchase some new kitchen units based on the products or goods that were displayed under the website of ‘Kitchens Deluxe of Guildford Limited’.
  • Based on the nature of the goods displayed under the company’s website, they arrived at one of their branch and inquired about the same.
  • This shows that the couple has entered into the contract of purchasing the kitchen units from the concerned branch based on the sample and other descriptions that were displayed on the company’s website. Moreover the ‘DW Elite 2021 Kitchen Dishwasher” was purchased by them based on the description and recommendation of the shop assistant as well as the model displayed in the store.
  • But on delivery of the ordered kitchen units, the shelves were of the wrong size in comparison to the ones that was identified by the couple as well as the dish washer supplied was also defective in nature.
  • This further demonstrates that the goods delivered are not of desired standard of quality and unsatisfactory in nature based on the purpose for which it shall be used by the couple, leading to the breach of the contract of supply entered upon by the parties.

Conclusion
Therefore it can be stated that, Mr. And Mrs Williams are entitled institute civil claim against the goods supplied by Kitchens Deluxe of Guildford Limited as the latter acted in violation of the statutory rights guaranteed to the consumers under a goods contract within the CRA, 2015. The couple are entitled to either completely reject the goods or claim for the right of repairing or replacement under the said legislation.

Casework 04
Issue

  • Whether Maria and Sandra are entitled to bring any claim against Essence of Organic Life within Guildford’ based on the reaction suffered from their products?
  • Whether Henry and Louisa can be liable to pay damages against the harm suffered by both Maria and Sandra?

Rule
Under Sec. 2(8) of the CRA, 2015, definition of the term “Goods” has been mentioned which includes any items of moveable nature .

Sec. 9 of the CRA, 2015 states about delivery of goods that are of satisfactory quality

  • The good supplied should be fit for the required purpose of use or should comply to the nature for which they are usually supplied .
  • The appearance and finish of the good should be of proper standard
  • The good should be safe and of reasonable standard of usability.
  • Goods should be devoid of any defects .

Sec. 10 of the CRA, 2015 states that any contract to sale or supplying of goods to the consumers should be reasonably fit for the purpose based on which it is purchased. As per the rules of custom, it shall be presumed that any contract to supply of goods shall already include the term that the good is fit for any particular purpose.

Sec. 11 of CRA, 2015 expressly mentions about circumstances in which goods are supplied based on any description relied upon by the customer. Any such contracts are said to imply the term that the good rendered will match the description .

Application

  • Here Henry and Louisa along with Amanda are running and operating an organic food and cosmetic centre Essence of Organic Life within Guildford. The company pledges to sell products that are only organic in nature and the cosmetics made up of natural ingredients.
  • The two products that is All Organic Deep Cleanse Cleaner’ and the ‘Anti-Wrinkle Life Creams that were launched by the company were immediately placed on sale.
  • As alleged by the company, that the cosmetics are made only through natural ingredients, both Maria and Sandra suffered from severe skin reactions upon using the same. Based on the toxicology report it was found out that the products contained ingredients of acidic nature.
  • This further established that since the cosmetics were purchased based on the description of the company by Maria, the products was not fit to use for its specific purpose as well as they did not conform to the description provided. This showcase that there has occurred a breach in the contract of sale entered upon by the parties on the part of Henry and Louisa.

Conclusion
Henceforth it can be said that ‘Essence of Organic Life Within Guildford is to be held liable for the severe physical injuries incurred by Maria and Sandra based on violation of the statutory obligations entrusted under the CRA, 2015. Maria and Sandra are entitled to claim compensation from Henry and Louisa based on the extent of injury suffered by them.

References
BASIC PRINCIPLES OF ENGLISH CONTRACT LAW (2021) accessed 18 May 2021.

Beresford N, 'The Law Reviews - The Product Regulation And Liability Review' (Thelawreviews.co.uk, 2021) accessed 18 May 2021

Business F, 'Equality Act 2010 | Protected Characteristics | Forum Of Private Business' (Forum of Private Business, 2021) accessed 18 May 2021

'Consumer Protection Act 1987' (Which?, 2021) accessed 18 May 2021. 'Consumer Rights Act 2015' (Legislation.gov.uk, 2021) accessed 18 May 2021.

'Equality Act — General Principles: In-Depth | Croner-I' (App.croneri.co.uk, 2021) accessed 18 May 2021

'Equality Act 2010' (Legislation.gov.uk, 2021) accessed 18 May 2021.

Giliker P, The Consumer Rights Act 2015 – A Bastion Of European Consumer Rights? (2021) accessed 18 May 2021

'Product Liability - Consumer Protection - UK' (Mondaq.com, 2021) accessed 18 May 2021.

'Product Liability In The United Kingdom | Lexology' (Lexology.com, 2021) accessed 18 May 2021.

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