Reference no: EM133352905
Kylie operates a successful bottled-water business in Bundoora. She decides to sell a greater variety of bottled water. After examining different brochures she discovers 'Dave's Bottled Mineral Water Supply'.
The owner of the business, David, operates as a sole trader in country Victoria. Kylie tells David that she sells bottled water, but is interested in expanding her business by selling mineral water.
David tells Kylie that he has a large selection of mineral water, and shows her a brochure detailing all the different kinds of mineral water he has for sale. The brochure shows that the mineral water comes from a mountain creek.
Kylie asks David whether he has some mineral water for her to try. David hands over a bottle from the shelf and asks her to taste it. Kylie drinks the water and says it tastes better than plain water.
Kylie decides to buy a year's supply to sell to her customers. She purchases 35,000 bottles for a total cost of $35,000. David hands Kylie a written contract. She checks the number of bottles and the price, but doesn't bother to read the rest of the written terms before signing the document.
After selling 1,000 bottles of mineral water in the first two weeks, some of Kylie's customers complain about stomach pains, vomiting and diarrhoea. Kylie sends a bottle of the mineral water to a scientific laboratory. The lab discovers that the water contains a virus.
Kylie comes to you for legal advice.
1. Which is the relevant legislation for Kylie to apply here, and why?
2. Which three statutory implied terms might Kylie rely on? Give reasons for your answers, and cite the relevant statutory provisions as well as any relevant case law.
3. What remedies might be available to Kylie in these circumstances?
4. Is David still liable for breach of any implied statutory term? Why or why not?