Commercial Law Essay

An estate in fee simple gives the purchaser ownership of the property for all time, including all renovations, the land, and any enhancements made thereon. A fee simple owner of commodities also has the sole right to use and dispose of the property however he pleases and whenever he sees fit. By selling, he means he can sell it, rent it out to others, exchange the land for other goods or property, give it away, or leave it to heirs after his death. This is the most common form of property ownership that everybody is well conversant. On the other hand, a leasehold estate refers to a kind of ownership arrangements between the lessor and lessee for the latter to use the former’s property while paying fees for them. However, the biggest difference between the two exists regarding ownership of the property in that in the fee simple estate; the buyer acquires the ownership of the land. Whereas in leasehold, the customer only gets the right to use the real property for a particular period. Moreover, passing on the property to another party, the use of the land becomes limited to the amount of time remaining in the original contract in that, after the duration has elapsed, the property reverts to the original owner or the lessor (Barber, 2015).

Task 1.2

If Bruce Smith decides to take up the Clevedon property in fee simple, it means he shall have acquired the ownership of the house in perpetuity. The rights of property, renovations, improvements and use automatically become his. He, therefore, has the freedom to lease, sell or transfer the house to a beneficiary in case of his death. On the other hand, if he takes the Whitford property as leasehold, he will have to renew the contract from time to time. Moreover, he will only obtain the rights to use the property and not ownership. He cannot sell the house to a third party but can only lease it. Additionally, his usage of the piece is limited to the 20 years defined in the contract not unless the lease term is extended.

Task 2

Beginning the year 2002, the land records have been operating online, and its accuracy hugely depends on the preciseness of data about the features of the land. Boundary dimensions and property location are together grouped and displayed in cadastral survey plans. The registration and transfer of land in New Zealand are governed by the Land Transfer Act of 1952 and the Land Transfer Regulations 2002. Transfer Act divides New Zealand into 12 districts. Therefore, all land records are organized in agreement with the assigned regions. Retrospectively, Bruce has to know the district in which the land he wants to buy lies so that he can make contact with the district registration office to get the title (Duncan et al., 2016).

Initially, the deed system was efficient in recording land ownership. However, the system became replaced by the current land titles system in 1870. The land titles system has its foundations on the mirror, curtain and insurance principles. The mirror principle opines that the register should ultimately reflect the state of the title while the curtain principle provides that the buyers of land should never be concerned with interests and trusts that lie behind the curtain of the register. On the other hand, the insurance principle is in place to guarantee for loss of interests and title that may occur as a consequence of errors in the registry (Duncan et al., 2016).

The indefeasibility concepts accrue in the land transfer system to protect and defend the registered purchaser of property against the claims of another owner as well as interests not registered. However, the guarantee is provided to the limit of the accuracy of the rights contained in the record. Moreover, indefeasibility cannot apply in a case whereby the proprietor acquired title for the contested land or property through fraudulent means.

Task 2.1

There was a breach of the contract of sale of the special ice boxes about the Sale of Goods Act 1908 Part 1(17), sale by sample. 1 (17) (2), a sale by sample only occurs when the bulk corresponds with the sample in quality; the buyer shall have a reasonable opportunity to compare the sample with the majority. The goods should be free from any defect which renders them untradeable. Eco Tours requested to buy ice boxes with a specification of being below freezing point for 24 hours, leak proof and store up to 20 kilograms of fish.

Section 36 (1), the buyer has the right not to accept goods delivered to him or her until he finds a reasonable opportunity to examine and confirm if they conform to the contract specifications. Subsection (2) requires the seller to accord the adequate buyer time to inspect the goods delivered for purposes of ensuring that they match the contract requirements. The ice boxes, therefore, breach the terms of the 1908 Sale of Goods Act. First, they ten boxes taken out on a fishing trip leaked, did not contain the temperature at below freezing point and as well one box broke even when it carried a weight less than 15 kg (p.16).

Task 2.2

According to the Sale of Goods Act, 1908 Section 22 Risk prima facie passes with the property, subsection (1), the goods remain in the seller’s custody together with all the risks associated with them until the property is transferred to the legitimate buyer. However, if the goods are transferred to the purchaser, all the risks are passed on to the new owner irrespective of delivery. Additionally, in instances where delivery gets delayed under the fault of either party, the buyer or seller, therefore, the risks of loss of damage lie with the party that caused the delay especially if the damage could not have occurred except for the fault (Goode, Kronke & McKendrick, 2015, p.12). In this case, at the time of the crash, Eco Tours had the property and therefore the risks in the goods for they had delayed payment of the last installment for the purchase of the boat.

Task 2.3

Eco Tours should not pay for the artwork because it spoiled before the risk could pass on to the company. Part 1 of the Sale of Goods Act 1908 section 9; “Goods perishing before sale but after an agreement to sell” opines that if an agreement exists between a seller and a buyer for particular goods but the goods spoil before the risks are transferred to the buyer, the contract is declared void. However, both parties should not participate in contributing to the spoilage of the products in question. But if one party is responsible for the perishing, then he or she has to meet all the expenses for making the products sellable (Kelsey, 2015).

Task 3.1

(a) If the plan is implemented, it will breach the provisions of the Act. Section 27 1 (A) (a) provides that a trader shall never withhold any meaningful information from the customer. The seller is expected to provide adequate information as it regards to the rights and obligations under whichever customer transaction. 28 (1) provides that if a producer does not comply with the consumer information standards defined in 29 (1A), then he should not advertise or supply the said products until he complies. Contravention of Part 1, 2, 3 or 4 is liable on conviction to a fine not exceeding $200,000.

(b) According to section 9 “Misleading and Deceptive Conduct generally” traders are prohibited from indulging in practices that are deemed false and deceptive. In the case of contravention of the provisions of Section 9, Sections 10, 11, 12 provide both the civil and criminal sanctions as well as remedies. In the provisions of S42 requires traders who have placed misleading advertisements may be inducted by a court of law to publish corrective advertisements. S41 also gives the court power to prevent Eco Tours from engaging in matters that breach the provisions of the Act.

(c) Section 42 provides that the court reserves the mandate to force Eco Tours to disclose all information as well as publish and advertisement to correct the misrepresentations and misleading information provided. Section 43 (3) (a) opines that the court upon determination can void any contract entered into as well as (a) (ii) void the whole transaction altogether. In (c) the Disputes Tribunal or the court can (i) vary the arrangement to suit the first manner specified.

Task 3.2

(a) Referring to section 9 (1), Evans is considered a consumer for the products were delivered as described. Despite Evans signing the contract statement, he is still a consumer as provided by both Section 5 and 5B.

(b)The above act has been breached referring to section 25 and 26 of the Act whereby the supplier was supposed to reveal all correct information regarding the operation of the trailer. Additionally, Evans has a right to seek redress from the Nomad Homes Ltd.

(c)Evans can utilize among other remedies as provided by section 27(2) (a) repair of the trailer, (b) replace the trailer with an identical one.

Task 3.3

According to Section 21 (a) to (d), Angers can seek compensation and redress from the manufacturer on the premise that the goods could not have been bought by a reasonable consumer not well acquainted with its use. In (c), the burner became substantially unfit for the purpose for which it was bought for of which the reasons are well known to the supplier. Additionally, the supplier is obligated to repair the burner to a working condition as provided in section 8 (1). Section 7 further provides for redress if the goods are not of a quality that is within the acceptable terms of it is faulty hence unsafe. Section 23 (4) provides that if the consumer, in this case Angers, he obtained the help of a technician to repair the burner, it is deemed to have been executed by the supplier. Therefore, Angers deserves to be compensated for the amounts he spent in repairing the log burner (Parliamentary Counsel Office, 2017).

Task 4

Dilly is negligent in the first place for driving while tuning her car radio. Had she concentrated on the road, she could have avoided hitting Sue’s car. Secondly, she was over speeding. On the other hand, Pete ought to have parked his car by the roadside or put the hazard lights on to warn other motorists and drivers. Sue is also liable to some extent in that she did not exercise caution because she could have easily avoided colliding or swerving off the road. However, the cause of the accidents can be attributed to Dilly’s careless driving. Eco Tours has a vicarious liability regarding the actions of its employee Dilly. The company will be liable for paying the damages caused by Dilly’s negligence. However, Eco Tours and Sue as well as Pete will share the liability of the destruction caused by the fire on Farmer Brow’s house and paddock (Millard & Bascerano, 2016).

The case of indemnification arises when either solely the employee or solely the employer is sued. If only the employee is sued, then that employee may seek indemnification from the employer if the conduct was within the course and scope of their employment. If only the employer is sued, then the employer can attempt to avoid liability by claiming the employee’s conduct was outside of the scope of the employee’s authority, but the employer generally cannot sue the employee to recover indemnification for the employee’s torts. Eco Tours is liable vivaciously for it owns the car that got involved in the road accident out the negligence of its employee.

References

Barber, M. (2015). Consumer law in New Zealand, [Book Review]. Canterbury Law Review, 21(2015), 187.

Duncan, W. D., Christensen, S. A., Dixon, W. M., Window, M., & Rivera, R. (2016). Issues Paper 1-Property Law Act 1974-Sales of land and other related provisions.

Goode, R., Kronke, H., & McKendrick, E. (2015). Transnational commercial law. Oxford University Press.

Kelsey, J. (2015). Reclaiming the future: New Zealand and the global economy. Bridget Williams Books.

Millard, D., & Bascerano, E. G. (2016). Employers’ statutory vicarious liability in terms of the Protection of Personal Information Act. PER: Potchefstroomse Elektroniese Regsblad, 19(1), 1-38.

New Zealand. Commerce Commission. (1997). Refunds, returns, guarantees and warranties: The links between the Consumer Act and the Fair Trading Act (91). Wellington [N.Z.: Commerce Commission.

Parliamentary Counsel Office. (2017). Consumer Guarantees Act 1993 No 91 (as at 01 March 2017), Public Act Contents - New Zealand Legislation. Retrieved from http://www.legislation.govt.nz/act/public/1993/0091/latest/DLM311053.html#DLM312830