Principles of Private Law Mid-Semester Assignment

Semester 2, 2014
Due on 24 September 2014 at 4 pm
John is a born and bred miner who has spent his whole life living in the remote, western
New South Wales mining town of Broken Hill. John also loves the sea and spends every
holiday either fishing, sailing or sitting on a beach. He keeps himself very fit and has gained
enough experience to be regarded as a competent sailor.
In May 2014, John takes six weeks leave and drives to Sydney with the aim of finding a place
on a sailing boat. Through a friend he is introduced to Athena, who has just been given a job
relocating a yacht to Vanuatu. The owner of the yacht, who is a billionaire, wants to spend
two weeks sailing around the islands of Vanuatu and has agreed to pay Athena $50,000 to
relocate the yacht on time. Athena has already found a crew for the trip, but there is plenty
of room on the yacht. She forms the view that John will be a good crew member so she
offers him free passage to Vanuatu. She tells John that she is only interested in people who
are with us for the whole trip, that he will have to do all the usual duties of a crew
member and that he will be given a bed and food during the voyage. John has always
wanted to go to Vanuatu and immediately says yes to Athenas proposal.
The yacht leaves Sydney and sails to Byron Bay, where it stops to take on additional
supplies. There has unfortunately been a lot of friction between the crew members, mainly
because one of the older sailors is constantly causing trouble. As a result, one of the crew
members decides to leave the yacht in Byron Bay. When John hears about this, he considers
doing the same. He approaches Athena and explains to her that this is his holiday and he is
supposed to be enjoying himself, which he has found difficult as a result of the constant
arguments. Athena is concerned as she does not want to lose any more crew members. She
says to John: look, I really want you to stay on. There might be a small amount of extra
work now that we have lost one crew member, but it wont be very much. And while I
havent done all of the calculations yet, it looks like I am going to make a good profit from
this trip. I tell you what: if you stay with us until we reach Vanuatu, and I get the payment
for relocating the yacht on time, Ill give you a share of the profits. John asks how much the
payment might be. Athena replies I really cant tell you yet as I havent done all the
calculations. I will decide when I get there. John thinks about it for a moment and then
agrees to stay on.
The yacht arrives in Vanuatu on time and Athena receives the payment of $50,000, however
she refuses to pay any money to John.
John is now in Vanuatu and needs to get back to Australia. Using a significant portion of his
savings, he purchases a ticket on The Tropical Tearaway, a medium-sized passenger ship
that is scheduled to depart for Sydney in three days. He takes the ticket back to his hotel
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and once there, realises that the back of it states that the carrier reserves the right to
cancel the berth where circumstances require. John is a little perturbed by this but decides
to deal with the issue in the morning. That night, while he is drinking away some of his
sorrow at the popular Port Vila night spot, The Flowerpot Snake, he gets chatting to a fellow
drinker and explains his predicament. As it happens, Johns drinking buddy, Peter, is the
owner of a small, two-person yacht, which he plans to sail back to Sydney the next day.
Being moved by Johns plight, Peter offers John a free ride back to Australia on his yacht.
Although at the time of this conversation both men have only had a couple of drinks, John is
concerned to make sure that Peter really means what he says, asking him: Are you really
sure about this? You realise that you dont know me very well yet and it may turn out that
we dont get along as well as we think we will. Peter replies that he does really mean it,
explaining that as it turns out he would be very grateful to have the company because his
original travel companion is enjoying his time in Vanuatu so much that he has decided to
stay on for an extra month, with the consequence that Peter is otherwise going to have to
sail back to Australia by himself. However, Peter does acknowledge the force of Johns
point and says that, although he considers the arrangement binding, it would be sensible for
each man to retain the option of resiling from the agreement tomorrow if either decides, in
the cold light of day, that he is unhappy to go ahead with it because hes not sure that he
will be able to undertake a long voyage solely in the company of the other person. With this
assurance, John gratefully accepts Peters offer and the two men happily drink the rest of
the night away.
After waking up, taking some berocca and drinking about three litres of water, John heads
straight into the offices of the company that owns The Tropical Tearaway, requesting the
cancellation of his ticket and a full refund of the money he has paid. However, the sales
representative with whom he speaks informs him that a refund is not possible and insists
that they have a legally binding contract John cannot resile from.
Advise John in relation to his rights under contract law.

(Assume for the purposes of this question that all matters will be dealt with under New
South Wales law).
Maximum length for answers is 1,500 words.