Problem 3
Issues
George enrolled in a DVD renting membership in a local video shop offering to allow members to rent 100 overnight DVDs for 3 months at just $100. He paid the joining fees of $100 without paying heed to the terms of contract of the membership and enjoyed the renting service. After several weeks he falls ill and is unable to return one DVD for a week and a day. When he goes to the shop to return the DVD, the shop owner asks for a late fee of $140 referring to a term of the contract which stated that the hire of the DVDs were for overnight only and any DVD not returned by 3pm the following day had to be compensated by paying a late fine at the rate of $20 each day. The late fee being $5 for all other shops renting DVDs (Wiley.com, 2016).
Problem 4
Issues
Grant deals in the business of selling of used motor vehicles in his Sydney car yard. For the security of the car yard, Grant enters into a contract with the Eagle Eye Security for patrolling the premises of the car yard at night. One Andy, a security guard on patrol lighted a cigarette and threw the match stick into a puddle of water as he thought but was in fact oil. As a result it caught fire and caused the explosion which destroyed the car yard altogether. However the contract between the two incorporated the following clause (Stewart and Stuhmcke, 2012).
Problem 2
Issues
The problem states that Eric sold his 1998 Commodore to Michael and the contract clauses were met as agreed. Eric wanted $2000 for his car and Michael handed over the exact $2000 in cash. Eric did not check the amount in the envelope that contained the money and he left after handing over the car and the documents of registration of the car to Michael only to find out later that the amount was paid in Hong Kong dollars instead of Australian Dollars which was equivalent to only 360 Australian Dollars. On raising the issue, Michael points out that the contract of agreement did not mention the currency of the amount but only said $2000 (McFadden, Mwesigye and Williamson, 2002).