Reference no: EM13863356

New Age Promotions (NAP) is a business specialising in marketing entertainers through radio advertising. It relies heavily on sponsorship by companies wishing to link their product with new musical artists.

A new client, Apple Cider Pty Ltd has approached NAP asking them to promote their latest product, apple cider wine. NAP recommend that they commence an advertising campaign which will link apple cider wine with "Silver Desk" an up and coming band which is due to play in an inner city location next week. Apple Cider Pty Ltd is delighted with the idea and enters into a contract with NAP to do the job.

On the following day, 7 August 2015, during the breakfast time slot, Mary the managing director of NAP' made the following radio announcement:

"Buy apple cider wine. The drink of choice of ‘Silver Desk' and their fans. We have a new competition opening this morning. Ten free tickets to the ‘Silver Desk' concert and dinner at Thai Newtown with the members of ‘Silver desk' are up for grabs for the band's only concert next Friday night.

To show our commitment, ten premium tickets for the concert and dinner at Thai Newtown with a combined value of $3,000 has been paid by NAP to secure these tickets and dinner. All you have to do to win one of the premium tickets is to come to the reception of NAP and produce 3 bottle tops from apple cider wines, per entrant, and give your name and email details to Sally at reception".

Scenario 1 - Jane's story

Jane Carlill was listening to the radio and heard the promotion for her favourite band ‘Silver Desk'. She was determined to enter the competition. She drove to her nearest bottle shop and bought 3 bottles of apple cider wine, drank the wine, saved the bottle tops and drove to the office of NAP.

Jane double parked outside the office, ran to the reception desk and met Sally.

Jane said: My name is Jane Carlill. Here are 3 bottle tops from Apple Cider wine, my email address is [email protected]

Sally took the bottle tops and said: "You're a winner".

Scenario 2 - Sam and Jerry's story

Sam and Jerry, hardworking university students, also heard the competition advertised on the radio that morning.

Sam said to Jerry "this is too good to be true. Let's buy the bottles of apple cider wine before they run out and we will take the bottle tops into the office of NAP this afternoon after our tutes."

Jerry said: "sure."

In the meantime, NAP was told by their legal department that there was a problem with the content of the competition broadcast earlier in the morning and to make a fresh announcement withdrawing the competition immediately.

At lunchtime that same day, the following announcement was made:

"The competition to attend the ‘Silver Desk' concert and have dinner with its members advertised in this morning's breakfast show is cancelled. No more bottle tops will be accepted."

Jerry and Sam heard the announcement, but did not believe it. Jerry and Sam arrived at the office of NAP and went straight to the reception desk to see Sally.

Sam said: Hi Sally, my name is Sam and my friend's name is Jerry - we have 6 Apple Cider bottle tops, and we are here to claim our free tickets to the dinner and ‘Silver Desk' concert. Our email addresses are [email protected] and [email protected].

Sally said: "Bad luck". The competition has been withdrawn.

At 4.00 pm on the same day Jane Carlill received an email in her inbox from NAP which stated:

"Thank you for entering our competition to win tickets and dinner with ‘Silver Desk'. We regret to inform you that the competition has since been cancelled."

You are asked to:

(1) Advise Jane, Jerry and Sam of their prospects of successfully suing NAP (New Age Promotions) with reference to the common law of Contract only.

? Do not consider nor advise upon any possible claim against Apple Cider Pty Ltd;

AND

Consider the legal issue in the following scenario and answer the question below

Scenario 3 - Story of Apple Cider Pty Ltd

The following scenario is unrelated to the story in Scenarios 1 and 2 and must not be referenced when answering Question 2 below. The following scenario is only relevant for purposes of answering Question 2 below.

Before Apple Cider Pty Ltd approached NAP to market its products, the following conversation occurred:

Sue, the managing director on behalf of Apple Cider Pty Ltd said to Mary (the managing director of NAP): "Apple Cider Pty Ltd is very interested in marketing its products and to invest heavily in selling its corporate merchandise at the upcoming Silver Desk concert."

Mary replied to Sue: "Sure, this will be a win-win situation. I think this arrangement will be fine but I will have to run it by the board of directors of NAP."

Before the board of directors of NAP had a chance to meet, Apple Cider Pty Ltd has now learnt from Sue that the concert by Silver Desk has been cancelled. Up and until the date of the concert's cancellation, Apply Cider Pty Ltd had spent $50,000 in promotional activities for its product which included the installation of large marquee at the concert venue to sell its apple cider products and other merchandise to the many thousands of rock fans expected at the concert.

(2) Advise Apple Cider Pty Ltd, with reference to the common law of contract only, of its prospects of successfully suing NAP to recover the $50,000 spent on promotional activities immediately prior to the cancelled concert.

? Do not consider any possible claim against Mary.
? Do not apply the law on Termination of Contracts (Latimer Chp 6- 280-6-510).