TABLE OF CONTENTS

PROBLEM SOLVING

1. Ms. Duyen v Stitch Inc

2. Ms. Duyen v the seamstress
3. Ms. Duyen v AMI Wedding
4. Stitch Inc v Ms. Duyen

CASE-NOTE

1. Introduction
2. Legal issue
3. Analysis
4. Conclusion

ABBREVIATION TABLE

CL Common Law
BoC Breach of Contract
SI Stitch Inc
ET Essentiality Test
OT Objective Test
PER Parol Evidence Rule
GP General Protection
SP Specific Protection
ACL Australian Consumer Law
CSC Consumer Service Contract
AW AMI Wedding
DASPL Darkos Automotive Service Pty Ltd
 PROBLEM SOLVING
1/ Ms. Duyen v Stitch Inc
CL

BoC

Main issue:

Could Duyen sue SI for BoC?

Sub issues:

Was the written contract breached?

The written contract specified the price, and the tasks need to be done. However, when Duyen
received the dress, the task was not done, it was incomplete with a large size, big shoulders, not
done bustle, and burnt left sleeve. Thus, a term was breached

Hence, SI breached the written contract.

Were any incorporated terms breached?

SI made verbal statements outside the contract. It includes the assurance about Huy would done
all the alterations.

The assurance statement was guarantee1, and independently verifiable2. There was reasonable
notice since Huy and Duyen directly discussed it3, and it was given before the contract
formation4. Applying PER5, these statements were important to Duyen. Because she did not want
the apprentice to work on her wedding dress since they may make mistakes.

Therefore, these verbal statements were incorporated into the written contract, and SI failed to
fulfil its obligation since the alteration was done by the apprentice.

1
Chandelor v Lopus (1603) Cro.Jac 4
2
Handbury v Nolan (1977) 13 ALR 339
3
Causer v Browne [1952] VLR 1
4
Thornton v Shoe Lane Parking (1971) 2 WLR 585; Olley v Marlborough Court Hotel [1949] 1 KB 532 Ltd
5
Van den Esschert v Chappell [1960]
Hence, SI breached the term in the contract.

Were the breached terms above warranty/condition?

Applying ET6:

Duyen would not sign the contract if it was not done by Huy; thus, it is a condition.

Was the disclaimer effective for SI?

SI’s disclaimer was formed before Duyen signed the contract7 and was a part of the contract8.
However, the situation was anticipated because the damages were caused by the apprentice, who
could cause damage because they lack skill. Thus, it does not fall into the scope of the
disclaimer.

Therefore, the disclaimer was invalid.

Conclusion: Duyen can successfully sue SI for BoC.

Collateral contract

Could Duyen sue SI for breaching collateral contract?

Huy promised to deliver the dress to Duyen. Duyen would not sign the contract if she knew she
need to pick up the dress by herself. Because she might be busy and the cost to pick up the dress
by herself was too high ($100 taxi fares). Hence, Duyen signed the contract because SI promise
to deliver the dress. Thus, there was a collateral contract.

Conclusion: Duyen can sue SI and get $100 taxi fares as monetary compensation.

ACL

 Duyen acquired the alteration dress service for her personal use.
 The price was $500 (<$100,000)

Duyen was a consumer and protected under ACL9.

GP

Could Duyen sue SI for breaching s18?

6
Tramways Advertising v Luna Park (1938) 61 CLR 286
7
Thornton v Shoe Lane Parking Ltd [1971] 2 QB 163
8
L'Estrange v F Graucob Ltd [1934] 2 KB 394
9
ACL (Cth) section 3
SI assured all the alterations would be done by Huy. This statement is a part of business for
profit. Applying the OT10, this conduct misled Duyen to believe that all the work would be done
by Huy, which was incorrect.

Thus, Duyen can sue SI for breaching s1811, award damages12 , grant injunctions13 and terminate
the contract14.

SP

Did CSC exist?

+ SI provided alteration dress service for Duyen for profit

+ The total payment was $500 (<$100,000)

Conclusion: A CSC existed15.

Could Duyen sue SI for breaching s60?

When Duyen received the dress, it was incomplete with many mistakes. This means the dress
was not done with due care and skill.

Thus, Duyen can sue SI and terminate the contract.

Could Duyen sue SI for breaching s61?

The disclose purpose expressed by Duyen was the necessary dress alteration to accommodate her
shape. However, the dress was unfit, which means the result was not fit for the disclosed
purpose.

Thus, Duyen can sue SI and terminate the contract.

Disclaimer

Applying ACL s6416, the disclaimer is ineffective.

Major failure

10
Taco Company of Australia Inc. v Taco Bell Pty Ltd (1982)
11
ACL (Cth) section 18
12
ACL (Cth) section 236(1)
13
ACL (Cth) section 233
14
ACL (Cth) section 237
15
ACL (Cth) section 23(3)
16
ACL (Cth) section 64
Applying ACL s26017, this is not a major failure since it was a service, not a good.

2/ Ms. Duyen v the seamstress

CL

BoC

Main Issue:

Could Duyen sue the seamstress for BoC?

Sub Issue:

Was the written contract breached?

The written contract contained the parties’ names, price, completion date (the corrections would
be done by 30 July), and a clause stating that the dress would be fixed properly to fit Ms.
Duyen’s shape. However, Duyen received a tight, too-short dress that didn't fit her shape. Thus, a
term was breached.

Hence, the written contract was breached.

Was the disclaimer affective?

The disclaimer was formed18 before the contract was signed by Duyen19. The seamstress
estimated by herself for fixing since the note of measurement was lost. Hence, when the dress
was unfit Duyen, the alteration was not done based on Duyen’s shape. Therefore, the breach does
not fall within the scope of disclaimer.

Thus, the disclaimer is invalid.

Conclusion: Duyen can sue the seamstress for BoC.

ACL

 Duyen acquired the alteration dress service for her personal use.
 The price was $450 (<$100,000)

17
ACL (Cth) section 260
18
Thornton v Shoe Lane Parking Ltd [1971] 2 QB 163
19
L'Estrange v F Graucob Ltd [1934] 2 KB 394
Duyen was a consumer and protected under ACL20.

GP

Could Duyen sue the seamstress for breaching S18?

The conduct about the completion date is a part of the seamstress business for profit. Applying
the OT21, this conduct was inaccurate claims since Duyen may be misleading that she would be
received the dress by 30 July.

Thus, Duyen can sue the seamstress for breaching s1822, award damages23, grant injunctions24
and terminate the contract25.

SP

Did CSC exist?

+ The seamstress provided alteration dress service for Duyen for profit

+ The total payment was $450 (<$100,00)

Conclusion: A CSC existed26.

Could Duyen sue the seamstress for breaching s60?

When Duyen received the dress, it was incomplete. This means the dress was not done with due
care and skill.

Thus, Duyen can sue the seamstress and terminate the contract.

Could Duyen sue the seamstress for breaching s61?

Before contract formation, Duyen expressed the dress had to be fixed properly to fit her shape.
However, the dress was unfit, which means the result was not fit for the disclose purpose.

Thus, Duyen can sue the seamstress and terminate the contract.

Could Duyen sue the seamstress for breaching s62?

20
ACL (Cth) section 3
21
Taco Company of Australia Inc. v Taco Bell Pty Ltd (1982)
22
ACL (Cth) section 18
23
ACL (Cth) section 236(1)
24
ACL (Cth) section 233
25
ACL (Cth) section 237
26
ACL (Cth) section 23(3)
The service was completed when the customer received the outcome of that service. As the
mentioned completion date was for the correction, not the time the dress was received, the
seamstress must provide the dress within a reasonable time. However, the wedding dress arrived
the night before, which was too late.

Thus, Duyen can sue the seamstress and terminate the contract.

Disclaimer

Applying ACL s6427, the disclaimer is ineffective.

Major failure

Applying ACL s26028, this is not a major failure since it was a service, not a good.

3/ Ms. Duyen v AMI Wedding

Could Duyen sue AW for defective goods?

AW was a manufacturer29 that supplied the wedding dress to Duyen. AW was in trade. The dress
textile safety was not what a person generally entitled to expect30, Duyen allergy was caused by
the dress textile containing forbidden chemicals by China. Thus, AW’s good was defective.

Duyen can due AW for defective goods31.

4/ Stitch Inc v Ms. Duyen

Could SI sue Duyen for not paying $500?

The service cost would be paid after changes was done to accommodate Duyen’s figures as
proposed. The ordinary cost was $380, however, the received dress was not done fixing to
accommodate Duyen’s shape; thus, there was no BoC. In mid-June, Duyen offered $120
more to cover extra work hours and ensure on-time delivery. However, the additional contract
was invalid since SI’s acceptance and consideration was insufficient.

Conclusion: SI cannot sue Duyen under contractual law and take money back.

27
ACL (Cth) section 64
28
ACL (Cth) section 260
29
ACL (Cth) section 7(1)
30
ACL (Cth) section 9(1)
31
ACL (Cth) section 138
 CASENOTE
INTRODUCTION

The case Bertinat (the plaintiff) v Sam Estephan t/a Car & Commercial Sales (the defendant) was
adjudicated by the judge P French on 17 December 2019. I will discuss whether the judge’s
decisions were convincing.

LEGAL ISSUE

The plaintiff purchased a motor vehicle from the defendant on 17 July with $4,500. On 25 July,
the plaintiff found that the car was unworthy with serious leaking oil when she took it for a
routine service by a licensed machinic – Mr. Bongat. At first, the plaintiff requested the
defendant to repair the vehicle, however, the defendant did not carry out any repairs.

After two inspections by Mr. Chiraz and Darkos Automotive Service Pty Ltd, the car was still
unworthy with serious oil leaking. Since the plaintiff mailed the defendant for the rejection, ask
for a refund but the defendant did not respond to it, the plaintiff sue the defendant to seek for
rejection of the motor vehicle.

The main issue legal issue was whether the defendant fail to comply with the guarantee as to
acceptable quality when the defendant supplied the motor vehicle to the plaintiff, which breached
ACL s5432. The sub issue was whether there was major failure under s26033; did the plaintiff
conduct the remedy in s25934; if the rejection falls into rejection period35 and could the plaintiff
reject the good and get refund of $4,500 under s26336.

ANALYSIS

Though it is necessary to identify whether the Consumer Goods Contract existed before
analyzing the breach of s54, the judge did not prove there was a consumer contract. Applying
ACL s23(3)37, the price of goods is under $100,000 ($4,500)38 and the defendant was in trade as

32
ACL (Cth) section 54
33
ACL (Cth) section 260
34
ACL (Cth) section 259
35
ACL (Cth) section 262
36
ACL (Cth) section 263
37
ACL (Cth) section 23(3)
38
ACL (Cth) section 3
supplying goods is a part of ongoing business for profit39. Thus, there was a Consumer Goods
Contract.
Under s54, there was a guarantee as to acceptable quality in the supply of goods, which means
the good was free from defects (including both actual and hidden defects)40, fit for all-purpose41
and safe42. Testing these qualities, under subsection 54(3)43, the judge determined that even
though $4.500 was a reasonable price for a car, it was still a substantial amount of money by the
standards of regular people. A reasonable buyer would expect the car to be roadworthy for this
price, especially if it was advertised as being in good condition and roadworthy so the buyer
could "drive away no more pay.". In addition, those verbal statement was made before the
contract was signed. Hence, the judge convincingly concluded a reasonable buyer would not
believe that this car was of acceptable quality if she knew that it had a significant oil leak that
rendered it unworthy for the road and unsafe to operate.
The defendant contends that the motor vehicle passed the e-Safety check, and the defect was
caused by the plaintiff, and ‘goods do not fail to be of acceptable quality if the consumer causes
them to become so or by abnormal use’44. However, the serious oil leak was found within 10
days of the supply motor vehicle by a licensed mechanic – Mr Bongat, and it was consistent with
the examined defects found by Mr Chiraz and DASPL. Moreover, the plaintiff had hardly used
the vehicle, as the odometer recorded by Mr Bongat was 641 kms (lower than 1028 kms), and
there was no evidence that the motor vehicle was involved in an accident. Thus, I agree with the
judge that there was a latent defect in the engine at the time of supply, which means the defect
was not caused by the plaintiff. Hence, the defendant breach s54.
Applying s26045, there was a major failure since the defendant failed to comply with the
guarantee as to acceptable quality. As a reasonable customer, the plaintiff would not acquire the
good if she acknowledged the nature and extent of the oil leak. 
Under s25946, she also gave the defendant opportunity to fix the defects, however, he did not
carry out any repairs. As the rejection period was three months, the plaintiff vehicle’s rejection

39
ACL (Cth) section 2
40
ACL (Cth) section 54(2)(c)
41
ACL (Cth) section 54(2)(a)
42
ACL (Cth) section 54(2)(d)
43
ACL (Cth) section 54(3)
44
ACL (Cth) section 54(6)
45
ACL (Cth) section 260
46
ACL (Cth) section 259
was made within it47 (under 6 weeks). As a result, since the major failure was established,
applying remedy in s26348, the plaintiff must return the motor vehicle to the defendant, and the
defendant was not entitled to repair the motor vehicle but to refund the consumer the purchased
price, which was $4,500.
CONCLUSION

I agree with the judge that the defendant breached s54, and it was a major failure under s260.
Since the plaintiff did rejection within the rejection period under s259, the remedy applied under
s263 is the plaintiff will receive the refund of $4,500 and return the motor vehicle to the
defendant, the defendant is not entitled to repair the motor vehicle.

BIBLIOGRAPHY

Case

Chandelor v Lopus (1603) Cro.Jac 4

Handbury v Nolan (1977) 13 ALR 339
Causer v Browne [1952] VLR 1
Thornton v Shoe Lane Parking (1971) 2 WLR 585
Olley v Marlborough Court Hotel [1949] 1 KB 532 Ltd
Van den Esschert v Chappell [1960]

Tramways Advertising v Luna Park (1938) 61 CLR 286

Thornton v Shoe Lane Parking Ltd [1971] 2 QB 163
L'Estrange v F Graucob Ltd [1934] 2 KB 394
Derry v. Peek (1889) LR 14 App Cas 337

Taco Company of Australia Inc. v Taco Bell Pty Ltd (1982)

Legislation
ACL (Cth) section 3
ACL (Cth) section 18
ACL (Cth) section 236(1)
ACL (Cth) section 237

47
ACL (Cth) section 262
48
ACL (Cth) section 263
ACL (Cth) section 64
ACL (Cth) section 260
ACL (Cth) section 23(3)

ACL (Cth) section 233

ACL (Cth) section 262

ACL (Cth) section 259

ACL (Cth) section 263

ACL (Cth) section 2

ACL (Cth) section 54(2)(c)

ACL (Cth) section 54(2)(a)

ACL (Cth) section 54(2)(d)

ACL (Cth) section 54(3)

ACL (Cth) section 54(6)

ACL (Cth) section 7(1)

ACL (Cth) section 9(1)

ACL (Cth) section 138

ACL (Cth) section 54