Question 1
(13 marks)

On Monday, Eddie received the following letter from Oscar:

“1,500 summer dresses offered at $15,000 the lot. Let me know before 5pm Friday next whether you agree to buy. Payment by cheque is acceptable.I also have available a large number of jeans (about 5,000), at $10 each.”

On Wednesday, Oscar received a letter from Eddie, which stated:

“Would you accept $15,000 for the dresses payable over two months?”

Oscar did not reply to the letter.

On Thursday, Oscar sold all the dresses to Laura.

On Friday, Eddie sent a letter to Oscar:

“I accept 1,500 dresses at $15,000. I need these dresses urgently in order to complete my contractual obligations to a large and very valuable customer”

On Saturday, Oscar posted a letter to Eddie stating that the dresses were no longer available. The letter was never received by Eddie. However, at a local horse race meeting on Sunday, Eddie met a clerk from Oscar’s office who told him that Oscar would write to Eddie to tell him that the dresses had been sold.

Eddie’s letter posted on Friday was received by Oscar on Monday.

After three months had passed and no dresses had been received, Eddie checked the correspondence and noticed the first letter from Oscar regarding the dresses and noticed the reference to the jeans. He immediately posted a letter to Oscar:

“I accept your offer of 5,000 jeans at $10 each. I enclose a cheque for $50,000 in payment. Please deliver urgently. Where are the dresses I ordered?”

His cheque was returned to him immediately.

Eddie claims a breach of contract by Oscar for failing to supply the dresses and the jeans.

You are required to advise Eddie of any legal rights he may have against Oscar.

In your answer you are required refer to relevant legal authority. Briefly explain the cases that you consider apply to the above facts.

Question 2 (12 marks)

Colin took his dinner suit and his wife’s silk dress to the Soono Dry Cleaners, a firm his family used whenever they had dry cleaning to be done.

When Colin called to collect the clothing ,he was told that his dinner suit was missing and his wife’s silk dress was badly stained. No explanation was given about the stained dress. However, one of the assistants recalled handing the dinner suit to a customer who had apparently lost his docket but was able to identify the dinner suit when allowed to sort through the rack.

Colin protested that he had never read the sign or the docket.

1. Advise Colin whether he is entitled to compensation from Soono Dry Cleaners(6 marks).

2. Would it make any difference if Colin had noticed the clause on the docket and the assistant had said: “That excludes liability for damage to buttons and zippers” (2marks).

3. Assume that Colin is entitled to compensation for the loss of his dinner suit and the stained silk dress. He now tells you that because of what has happened his wife has suffered emotional distress because the dress was a family heirloom. He also tells you that he and his wife had to hire, at considerable expense, a dinner suit and a dress for a formal occasion because of the loss and damage(4 marks).

In your answer refer to relevant legal authority