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Introduction to Business Law

Introduction to Business Law
Learning outcomes assessed:
1) Understand the legal principles governing contract law.
2) Recognise the legal issues in given contractual situations.
3) Logically explain and apply these legal principles to the given situations using appropriate authorities
to justify the arguments made.
4) Clearly communicate ideas and concepts in written form.
Answer ONE of the following questions
1. Jane deals in the supply of home-made cakes. Her cakes are in high demand and normally she makes
??2,000 a month. Cakes are even more in demand in December when the Christmas season begins and
normally she makes ??4,000 in December.
In November her oven breaks and she sees an advert from OvenCo Ltd. in a local newspaper ??industrial
ovens at a bargain price of ??1,000.?? She immediately calls the company to buy an oven. However, no-
one answers the phone so she leaves a message saying ??I??d like to buy an oven, I have put the cheque
in the post. Please deliver as soon as possible.?? She then posts the cheque for ??1,000 to the address on
the advert. 15 day later she receives the cheque back with a note saying ??sorry, no ovens are left.??
Advise Jane on her contractual rights in the scenario.
2. John, a sweet shop owner has been running his business (as a sole trader) for many years. His daughter
Sarah has recently joined the business and would like to be more involved. Eventually Sarah will take
over the business when her father retires. They want to set up the most efficient business structure and
may want to expand to more shops in future.
John has one employee, Tony, who has worked in the business for 5 years. With Sarah now working full
time Tony is not required. John tells Tony not to come in anymore
As to all of the following, advise John and Sarah as to:
(a) the available choices of legal business structure;
(b) the advantages and disadvantages of their choice of legal business structure;
(c) the extent to which their liability for debts will be limited;
(d) the degree of management and control they will each be able to exercise in the business; and
(e) their possible liabilities to Tony.
The Unfair Contract Terms Act 1977 is misleadingly named. It only deals with a tiny subset of terms, and
does nothing to make sure that contracts are fair.??

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