Assignment on 700254- Enterprise Law, Consequences of breaching the particular type of term

Home, - 700254- Enterprise Law

700254- Enterprise Law

1. Issue

Madison and Daniel both having their own bicycle repair shops have come together to form a partnership in starting their new business name with the name of "Rolling Hill Bikes". The development of partnership has been based on certain terms and rules between them that indicate both to be fifty percent shareholders of the company. However, Madison has left for a voyage after ordering 250 tyres from Fast Bikes without having paid for the supplied materials. The issue has been noticed that being in complete darkness, Daniel received a letter from Fast Bikes claiming $5,000 as the payment against the supplied tyres.


Australian contract law advocates any regulations and terms directed towards enforcing specific promises. The part of Australian contract law has been governed by common law . In this precise case of Madison and Daniel, the issue can be considered under the part of contract law. The rules under Partnership Act 1832, No 12 can be applicable here as both of them have showed interest to form alliance with the intention of making profit out of the same business. This law is considering the interest of the partners as well as their liabilities and responsibilities in terms of partnership.



It has been noticed from the case study of Madison and Daniel that both of the individuals have come together to form a new business entity. Both Madison and Daniel have been agreed on an agreement devising some promises to be kept while operating the business together. Under the Partnership Act 1892 NO 12, both have been considered as the business partners regarding their newly formed company "Rolling Hill Bikes" as they have formed the alliance with the intention of making a profit together . They both have agreed to be equally responsible in terms of their contribution to the business, sharing customer contacts and information about supply agreement. However, a sharp breaching act has been noticed from the part of Madison who has not shared the supply agreement of Fast Bikes with Daniel. The letter claiming $5,000 has left him complete darkness. Though Daniel can be considered as the liable partner of the company to take the responsibility of the payment, he can make a direct charge against Madison for keeping him in dark about the agreements with the tyre supplier, Fast Bikes . In such case, the case can be considered under the instances of misleading conducts as Madison has not directly shared the information of supply agreements according to the contracts between them. Hence, Daniel cannot be considered fully liable to bear the expense of the tyres. In the case of "Partnership dispute: Wang v Rong [2015] NSWSC 1419”, three individuals, Wang, Zhong and Rong have entered into a partnership under the partnership agreement . However, Wang and Zhong have claimed Rong to violate the norms by breaching the terms of the contract. There has been a severe issue about the share of the company. The court has provided a proper justification about the share and dismissed the case as clear wordings in the partnership agreement has portrayed a perfect understanding of each partner to be liable for the debit of the company. Hence, in this case, also, Daniel can be considered liable according to the partnership agreement. However, he can put charge against Madison about not keeping the exact words of partnership agreement.



It has been noticed that contracts between Madison and Daniel have been developed based on certain terms and conditions. Madison has failed to keep the promise to share supply agreements with Daniel. This has made a serious issue in terms of the uncertainty that Daniel has faced. However, according to Partnership Act 1892 No 12, Daniel has been considered fully liable for the payment being a partner and 50% shareholder of "Rolling Hill Bikes"


2. Issue

Rupert has owned a house in Vaucluse and given a contract of landscape his front yard to Bruce at the expense of $40,000, after completion of the task. In the meantime, Rupert has gifted numbers of exotic and expensive palms to Bruce. However, after completion of the task, Rupert has requested Bruce to settle with an amount of $25,000 with making a promise of providing a further contract of fencing his backyard. Bruce, appreciating the palms once gifted by Rupert has accepted the reduction of fees with the expectation of next contract. However, the issue has been severe as after making an immediate payment of $25,000, Rupert has cancelled the further contract that he has promised Bruce.


In this specific case of Rupert and Bruce, a breach of contract has been noticed as Rupert has made a reduction in the part of Bruce’s remuneration that fixed earlier. In such situation Fair Work Act, 2009 can be applicable . Section no 111, under these act advocates of flexible working arrangement and establishes a sense of fairness to the employees regarding payment . Hence, taking into the consideration that Bruce has been employed by Rupert, Fair Work Act, 2009 has the scope of being perfectly applicable to recover $15,000 from Rupert.


It has been observed that Rupert has employed Bruce with a fixed remuneration of $40,000 which he has promised to pay him after the completion of the entire task of landscaping his front yard. Bruce has been sincere to complete the task and has finished it with given times. In the middle of the given time period Rupert has ordered a set of exotic palms and instead of using them to decorate his own garden, he has let Bruce keep those. This has eventually lead to the situation where Bruce has been requested to settle down with an amount $15,000 less than what has been previously fixed. This has been a clear act of breaching the norms under Fair Act Work, 2009. According to the specific law, Bruce cannot be deprived of his rights to get paid the right amount that Rupert as an employer has promised him before recruiting him with the task . In the case of “Receptionist vs. Daily planet”, it has been noticed that the receptionist has put a charge against her former employer named Daily Planet after she has rejected to get shifted to the position of a part-time employee from a permanent one . According to Fair Act Work, 2009, the employer has failed to provide her with proper regards, penalty rates, meal breaks, leaves, payment and superannuation. Hence, court has considered the situation and made a verdict on the favour of the receptionist and has awarded her with $170,000. This has been proven a complete breaching of the act which protects the rights of employees. The employer of Daily Planet has not maintained the rules to be followed in terms of protecting its employees. This breach has made the organisation to make a penalty of a huge amount to be paid to the receptionist. Similarly, in the case of Rupert and Bruce, the latter one has been noticed to be deceived by its employers by the means of reduction in payment. Apart from this, breaching of the act has been noticed when Rupert has cancelled the further order even after promising Bruce to give the contract of fencing the back garden . 


Considering all the details of the case, it can be observed that Rupert has performed breaching in the part to provide the fixed salary to Bruce. He has failed to keep his words to pay him rightly. In addition to it, he has not even kept his words to provide Bruce with the next working contract promised by Rupert. Hence, under the rules of Fair work Act, 2009, Bruce can claim his money from Rupert. Rupert can be perfectly considered to be liable in paying Bruce fairly under the same legislation. 


3. Issue 

Elizabeth and Simon are inclined to provide an order to Bricks and Mortar Pty Ltd. for developing plan of their restaurant situated in French’s Forest. After Bricks and Mortar has sent their standard contract for the job, Simon and Elizabeth have consulted with their solicitors to look after the matter. The solicitors have specifically identified three important terms to be paid attention by both of the business owners. Both of the clients need to be equally aware about the terms provided by the contractors as some cases are expressing contradictory views that can cause difficulties in future. 


The case is a perfect instance of contract development between two parties where Simon and Elizabeth have been the clients and Bricks and Mortar has been the contractor providing clause and terms to work on behalf of them. The agreement has been developed in the form of a written contract. Hence, contract law is to be considered in this specific case study that can include contracts made under legislations such as Fair Work Act, 2009 and Partnership Act 1892 .




Explanation regarding type of terms 

Assessing contractual terms is highly required in terms of considering the pre contractual negotiations. It eventually impact on the post contractual conduct after the contract has actually been implemented. In this precise case, the contract has been of express terms by its characteristics . Express terms are specifically those that parties generally articulate before concluding the contract. This type of terms generally encompasses a wide range of facts such as state of affairs, confidentiality terms and future happenings. This type of terms is potentially beneficial as it acts as the proof of the agreed terms between two parties . An insight can be gained in order to avoid any disputes and misunderstanding further. Apart from this, as a significant characteristic, this can be served as a legal documentation about the agreed terms and conditions between both of the parties. Hence, as a major benefit, it can reduce the risk related to payment detailing and timeframes that are set to be performed under the contract. Similarly, in this case as well, the clients have been aware of the standard of contractors and by the help of the lawyers clients have made an extensive search on it. This can facilitate both of the parties to make some alteration and finally enter into the contract. 

Consequences of breaching the particular type of term

Legal relationship is always subject to be developed on legal terms. In this case as well, it has been noticed that contract based on express terms has been established between two parties. Breaching in contract can of this term fetches equal penalty as that of implied terms. Express contracts have been made between employee and employers as a documentation of various terms and conditions to be performed between them . In different case instances such as “Perkins v Grace Worldwide” mutual trust and confidence within employees and employers have been destroyed due to not maintaining the rules that have been documented in the express terms.  Similarly, in the case of “Tullett Prebon (Australia) Pty Ltd v Simon Purcell” as well, it has been noticed that breaching of express contractual terms can be punishable offence. The termination of contract has been observed Mr Purcell has made the resignation 15 months prior completion of the period that he has been supposed to serve for the company of Tullett Prebon. Hence, this has been a potential instance of express contractual terms as court has consider the attempt of Mr Tullett Prebon to restrain Mr Purcell for another 15 months . Thus, the benefits and consequence of the express contractual terms can be observed that served the purpose of minimising law breaching acts under various contracts. 



Evaluating the nature of the contract established between Greentrees and Bricks & Mortar Pty Ltd, it can be considered as an express contractual term. The potentiality of this type of contract lies on the part that it provides a perfect insight about the actions to be taken regarding a certain project or in case of employment. For the case of Simon and Elizabeth, the contract can be considered to act as the validated proof and documentation that both of the parties are intended to perform during the course of the tasks.

Leave a comment


Related :-