Business Contracts Advertisement Besides Law

Question: Describe about the Business Contracts for Advertisement Besides Law. Answer: The impact and legal effect in relation to this dealing of the article in Modern Electronics and of the Entertainment Imports Ltd advertisement beside it Issue In the given case scenario we can clearly see that the Entertainment Imports Ltd. failed to deliver on their promise (as mentioned in the advertisement on Modern Electronics magazine) and as a result there was a breach of contract from Entertainment Imports Ltd. as per the agreement which took place between the company and the retail business establishment which dealt with the sale of electronic entertainment equipment in the market (West Lewis Jr, 2009). Legal Principles Condition and Warranty The condition is considered to be a fundamental stipulation regarding the contract of sale whereas the warranty is an additional stipulation of a sales contract. In case a condition is breached, there arises a condition wherein the entire contractual agreement could be considered to be repudiated or broken. In case of a breach in the warranty, the entire contract cannot be terminated but the aggrieved party can claim damages from the other party who are responsible for breaching the warranty ("Australian Contract Law | Julie Clarke", 2016). Application When Entertainment Imports Ltd. brought out the advertisement regarding their headsets in the Modern Electronics magazine, they clearly claimed that the headsets provided unparalleled quality of sound experience to their users which is not provided by any other headsets in the market. Moreover, the company mentioned in the magazine that their headsets were light in weight and were compatible with all forms of sound delivery equipment including digital televisions. The headsets promised the utilization of the latest technology in the market which would improve the sound quality by almost 50%. When the agreement was undertaken, the buyer bought 1000 headsets out of which 500 would have been of white colour and the rest 500 would be of black colour. While testing some of the headsets for quality issues, the buyer found that the headsets were of black and white colour (the ear pieces were of black colour and the cord was of white colour). The buyer found out that all 1000 headsets which were ordered from Entertainment Imports Ltd. were of the same colour (i.e. black and white). The buyer also noticed that the box of the headset included a notation which stated that the headsets are only compatible to use with LCD television only and not with every standard sound equipments as had been claimed in the advertisement published on the Modern Electronics magazine. Upon testing 20 headsets for evaluating the sound quality, the buyer also found out that half of them had very poor quality of sound reproduction which were far inferior to the quality of sound which were provided by the other existing headset manufacturers in the market. The buyer also found out that the headsets were heavier than the other available headsets in the market and they were not very comfortable to wear. Thus, we can clearly see that there has been a clear violation of the condition under which the contractual agreement took place in the first place. Entertainment Imports Ltd. failed in their promise to deliver the products according to the specifications and quality claimed by them in the advertisement given out in the Modern Electronics magazine ("APAIS 1994: Australian public affairs information service", 2016). Conclusion Thus, the contractual agreement which took place between the buyer and Entertainment Imports Ltd. clearly does not have any relevance in a court of law as the Entertainment Imports Ltd. failed to respect the condition under which the sale of the headsets took place. This agreement will be terminated in a court of law due to the failure of Entertainment Imports Ltd. to deliver the headsets according to the quality specifications which has been mentioned in their advertisement on Modern Electronics magazine. Thus, the buyer has the right to claim the full refund on the headsets as well, as the cost of advertisement regarding the headsets in the local newspaper (Johanson Vahlne, 2009). The legal effect of the discussions that took place between the buyer and the salesman of Entertainment Imports Ltd. in particular to the standard form contract that has been signed by the buyer Issue In the given case scenario, we can clearly see that there was a case of contractual liability between the buyer and Entertainment Imports Ltd. and thus both the parties are liable to pay damages to each other for violating the terms of the contractual agreement ("Elements of a contract - The Law Handbook", 2015). Legal Principles Contractual Liability This is a liability which is imposed on an entity or a party which has engaged into a contractual agreement in case they fail to abide by the terms of the contract. This liability is generally imposed on a party when they fail to perform their duty as mentioned within the contract. This is also termed as a breach of contract and which could be enforced on a party through adjudication ("Elements of a contract - The Law Handbook", 2015). Application In the case scenario given before us we can clearly see that both the parties have violated the terms of the contractual agreement which they have undertaken with each other. This makes both the parties liable to pay damages to each other under contractual liability for violating the terms of the contract. Initially before the agreement took place the buyer rang up the company Entertainment Imports Ltd. and had a talk with one of their salesman. The buyer expressed his intent to purchase a total of 1000 headsets out of which 500 would be of white colour and the remaining 500 would be of black colour as those were the colors which were thought to be the most appealing by the buyer. The salesman also said that full price of $10000 would have to be paid in full upon delivery of the 1000 headsets which was according to the company policies of Entertainment Imports Ltd. since the buyer was not an established account holder with the organisation ("Elements of a contract - The Law Handbook" , 2015). After this verbal discussion, the salesman of Entertainment Imports Ltd. forwarded a standard contractual form to the buyer through fax which mentioned the different provisions of the contractual agreement in a detailed manner. The buyer on his part made the grave mistake of signing the form without going through the detailed aspects of the contractual agreement which was to take place between him and Entertainment Imports Ltd. and he returned the form to the company. A day before the delivery of the headsets was scheduled; the buyer had to attend a family emergency which came up and this prevented him from returning back till Saturday 16th July, 2016 which was a day after the delivery date. In order to ensure that the smooth delivery of the handsets in time, the buyer wrote a cheque of $10000 (the agreed price for the 1000 headsets) which was to be paid during the time of delivery and couriered it to Entertainment Imports Ltds office on Thursday which was the day before the delivery date. The cheque arrived on the delivery date and Entertainment Imports Ltd. blanked it during the afternoon. After coming back from the personal emergency, the buyer came to realize that the headsets were not delivered to his shop. He called back the company and spoke to the same salesman with whom he had spoken earlier. The buyer enquired with the salesman regarding the failure to deliver the headsets at the shop to which the salesman said that the delivery boxes were available throughout the day at the loading docks of the company for the buyer to collect them but there was nobody to collect the shipment of the headsets (West Lewis Jr, 2009). This shows that the failure of the buyer to read the contractual terms was mainly responsible for all this confusion which took place during the process of delivering the headsets. The company delivered 1000 black and white headsets which was not according to the verbal agreement that took place between the company salesman and the buyer. The buyer ordered 500 black and 500 white headsets. This confusion regarding the colour of the headsets could have been sorted out much earlier had the buyer insisted to go through the terms of the contract which clearly mentioned the sale of 1000 black and white headsets to the buyer. Furthermore, the buyer also paid the total agreed amount in cheque and couriered it to the company as opposed to the payment on delivery which had been agreed by the buyer during the initial conversation over the telephone (Governatori et al. 2006). Conclusion Thus, there was a contractual liability from both the parties (the buyer and the company which sold the headsets). However, we need to mention over here that, the confusion regarding the colour of the headsets could have been prevented if the buyer had read the contractual agreement in a detailed manner ("Breach of Contract Definition, Examples, and Cases", 2014). On the other hand the buyer can face a contractual liability as he paid the money through cheque which was couriered to the office address of Entertainment Imports Ltd. instead of paying it in person at the time of delivery (Oman, 2010). Whether what happened subsequently would constitute a breach of contract by Entertainment Imports Ltd, by you or by both and whether that breach or those breaches would be sufficient to allow either party to terminate the contract and sue for damages The given case scenario clearly demonstrates the failure of Entertainment Imports Ltd. to meet the condition under which the agreement took place. The buyer upon testing the delivered headsets for quality issues found out that many of the headsets were of poor quality. The buyer tested 20 headsets and found out that half of the headsets had poor quality sound reproduction, which were much inferior as compared to some of the available headsets in the market. This was opposed to what was advertised in the Modern Electronics magazine wherein the company claimed that their new headsets improved the sound output quality by up to 50% and were way ahead in technology as compared to the other available headsets in the market. The buyer has also found out that the headsets were bulky in nature as opposed to being lightweight which was claimed by the company in the advertisement. This really puts a big question mark on the ethical practices which are being incorporated by Entertainment Imports Ltd. within their business ("Corporations Law in Australia", 2016). The organization has clearly failed to deliver on their promises which they have claimed in their advertisement in Modern Electronics magazine. This clearly indicates a lack of corporate ethics on the part of the organisation as they are providing false assurances and promises to their customers in the market. Thus, the organisation is laible to pay compensation and damages to the buyer for the losses incurred by him as a result of buying those inferior quality of headsets and the advertisement cost which has been paid by the buyer to a local newspaper in order to promote and popularize those headsets so as to get maximum responses from the customers during the weekend holidays. Under the present scenario, the agreement could be terminated as the company failed to deliver on the promises which have been claimed in their advertisement (Hansen, 2008). The company on their part can also appeal to a court of law in case charges are leveled against them for delivering black and white headsets which was not what the buyer intended to buy from them. There courts would consider the fact that the buyer failed to go through the terms of the agreement which clearly indicated the colour of the headsets which were being delivered to them. In case of payment at the time of delivery, the company cannot claim any compensation from the buyer as they have received the full payment in time. Moreover, the fact that the buyer had a justifiable reason for being unable to pay at the time of delivery would provide additional legal leverage to him and thus he would not be liable to pay any compensation to the company ("Corporations Law in Australia", 2016). Conclusion Thus, in the present context we can clearly say that the company is liable to pay compensation to the buyer for lack of corporate ethics and failing to satisfy the conditions of the agreement. References APAIS 1994: AUSTRALIAN PUBLIC AFFAIRS INFORMATION SERVICE In-text:("APAIS 1994: Australian public affairs information service", 2016) Your Bibliography:APAIS 1994: Australian public affairs information service. (2016).Google Books. 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