Reference no: EM133256023

Case: Analyse and apply a variety of legal concepts relating to corporate (including an understanding of trust and joint venture business structures) and/or contract law, drawing on both common law and statute law
When applying legal concepts and principles in the conduct of business and entrepreneurial activities, use critical thinking and analytical skills to construct coherent and logical legal arguments and effectively communicate them.
Answers must be legal in Australia. Any answers based on laws from another country or jurisdiction will receive a failing grade unless they are used to compare or extrapolate perspectives from another legal jurisdiction with Australian laws. The exception is English law, as Australian courts' approaches tend to reflect the English position.

Assignment Problem Question:

Alvin made the decision to host a monthly "Pinball Tournament" in an effort to draw people to his retro-themed Southbank café, Merah Café & Bar. The first competition was slated to go all day on Friday, May 10, until the "Grand Final" on Sunday, May 12, in the evening.

In April, Alvin contracted with Belle, who runs her own business selling and hiring out vintage pinball machines. Alvin explained to Belle that the pinball machine must be able to withstand 3 days of continuous playing. Belle recommended the 'Supermax' range and, in a reassuring manner, says that "the Supermax is very reliable and robust; and I guarantee that it will satisfy all your tournament requirements".

Alvin and Belle agreed that two 'Supermax 1975' pinball machines would be hired for one weekend a month for the next six months, at a total cost of $12,000. To conclude the contract, Belle handed Alvin a written contract of hire. On the front page of the contract document was printed in bold but not in big print, the following words:

This contract document is intended to create a legally binding contract; any party contemplating signature is advised to take appropriate independent advice before doing so.

The other terms include the following (among others):

Clause 4: All terms of the contract are included herein. It is hereby acknowledged that all express or implied term or statements are hereby excluded unless specifically included in this Agreement.

Clause 5: Delivery of the machines supplied under this agreement will take place no later than 2pm, Friday 10 May.

Clause 6: The Owner (Belle) warrants to the Hirer (Alvin) that the pinball machines supplied under this agreement are in good working order and in a playable condition. This warranty, however, does not guarantee that the pinball machines are faultless or that it will work for the duration of the tournament for which they are used for. In the event that the pinball machines becomes faulty, the Owner's liability is limited to replacing the pinball machines within 2 business days from the time the fault is reported or refund of the hire charges at the Owner's sole option.

After briefly looking over the contract terms, Alvin agreed to sign the contract with Belle. Belle, then, stamps the contract with the following:

It is hereby acknowledged by the party whose signature appeared below that they have read and understood all the terms of the contract.

Belle asked Alvin to sign just below the above statement and he handed Belle an agreed deposit of $1,000.

On 10 May, Belle was delayed, because she was busy negotiating a particularly lucrative sale to another client. As a result, she did not deliver the machines to Alvin's café until 7pm. Alvin had carefully scheduled the tournament to begin at 4pm and, as a result, a considerable number of his customers were unable to play as scheduled.

To make matters worse, one of the machines developed a fault, which meant that after every three games, it needed to be reset, which took five minutes each time. On Saturday, over the course of the day both machines developed serious faults, which meant that neither machine could be used to play pinball and the tournament had to be cancelled.

Alvin is furious that the tournament was a disaster and wishes to recover damages for the problems he experienced. He also no longer trusts Belle and wishes to terminate the contract that he had signed.

Advise Alvin as to his legal rights, including whether he may terminate the contract for any breach(es) of clauses 5 and/or 6.