Page 5of 11HI6027 Business and Corporate Law Group Assignment T2 2019Part A: Contracts Law Questions–1SOOBurgers is a chain of hamburger restaurants operating in Australia and New Zealand. Sales across the restaurant chain were slow in the last financial year. In order to sell more hamburgers, SOOBurgers ran a competition Australia-wide, which was extensively promoted on radio, newspapers and online. The promotion is called “the Fair Dinkum deal”. According to promotion rules, a token would be attached to the wrapper of every “Double Decker Emu Burger”. If a customer collects 50 of these tokens, they could be redeemed at the counter for a golden scratch ticket. The promotion rules also stated:“Fair dinkum! Scratch the golden ticket. If it reveals a golden car, present your ticket to the SOOBurgers head office and win the grand prize of a brand new Mazda CX-9.Hurry! This promotion doesn’t last forever!”Michael “Mickey” Morrow was extremely keen to join the promotion and win the car. It also helped that he loves SOOBurgers, particularly the Double Decker Emu Burger. The very next morning after he heard the promotion announced on radio, he rushed to his favourite SOOBurgers branch in Fitzroy. He ordered 50 Double Decker Emu Burgers. Mickey was a man on a mission, and he ate as he had never done before in his life. He passed out from exhaustion and had to be rushed to the emergency room of his local hospital to get his stomach pumped. Luckily though, before passing out, he made sure to redeem his 50 tokens at the counter for a golden scratch ticket.As would be expected, not all customers were thrilled about going to SOOBurgers and buying a Double Decker Emu Burger just for the chance to win a car. Consequently, many burger wrappers that contained tokens were thrown away in the rubbish bins. Brett Vulture scavenged through the rubbish bins of the SOOBurgers branch at Altona. To collect the discarded wrappers for their tokens. He quickly collected 100 tokens. He went inside the restaurant and redeemed the tokens for two golden scratch tickets.He was ecstatic when he scratched them and found, not one, but two golden cars! He then rushed to SOOBurgers head office in Melbourne, where he presented his winning tickets. The receptionist told him to wait at the reception waiting area. While waiting,an employee came from inside the office and posted a sign on the front door of the office. Curious, Brett approached the sign and read:“SOOBurgers apologises that because of a printing error, incorrect golden scratch tickets were included in the Fair Dinkum deal. Management is sorry to advise that these faulty tickets are void and will not be honoured.SOOBurgers thanks its customers for their patience and invite all of them to join its next exciting promotion.”As Brett looked at the posted in dismay,he spotted another customer who emerged from office accompanied by a SOOBurgers employee. The customer was smiling from ear to ear as he shook the employee’s hand, and said, “I’m so happy to win the car!” It turned out that that customer came in before Brett and presented a winning golden scratch ticket. SOOBurgers honoured his ticket since it had already purchased the only Mazda CX-9 that it was going to give away as the big prize.In the meantime, while Mickey was at the hospital, SOOBurgers’ announced on radio, newspapers and online that there had been a printing error in the golden scratch tickets. As a result, instead of only one winning golden scratch ticket in the promotion to win the Mazda CX-9, every one in five tickets were winning tickets! SOOBurgers announced that it was immediately declaring that their Fair Dinkum promotion was void and would not honour any prize claims. Mickey did not actually Page 6of 11HI6027 Business and Corporate Law Group Assignment T2 2019read or hear this announcement. But he overheard some nurses talking as they passed his room about SOOBurgers promotional fiasco and the cancellation of the entire promotion.Mickey quickly found his golden ticket, scratched it and found a golden car. Thinking that he had not heard anything official from SOOBurgers itself, he discharged himself from the hospital and went straight to the company’s head office with the aim of redeeming his winning ticket. When he arrived, there was a mob of angry customers outside the notice on the front door. As the crowed covered the notice, Mickey did not read it; instead, he approached the receptionist and presented his winning ticket.SOOBurgers now seeks your legal advice on whether they have to provide (a) Mickey and (b) Brett with the Mazda CX-9s they are claiming. Please advise on Mickey’s and Brett’s positions separately.
lecture note:2( for question 1)
Part B: Corporations Law questions–choose one onlyOption 1SparklingPty Ltd (Sparkling) operates three children’sclothing shops in Tasmania. On 8 August 2007, Sarah was appointed to the position of Managing Director of Sparklingfor a period of two years. A return was lodged with ASIC indicating her appointment as a director on that date. Sarah was not formally reappointed after 8 August 2009, but she has continued to act as Managing Director. No return was lodged following the expiration of her period of office. The terms of Sarah’s appointment, which were set out in a contract between her and Sparkling, included a restriction to the effect that she was not to commit the company to borrowing transactions in excess of $20,000. Any such transaction was to remain subject to the approval of the board of directors.On 20 December 2010 Sarah, purportedly acting on behalf of Sparkling, signed a log contract with Costello Bank, pursuant to which the Bank agreed to lend the company $30,000 in order to establish a eucalypt plantation. The transaction was not referred to the Board.The Bank was not aware of either:the contents of Sarah’s contract; orthe return lodged by Sparklingat the time of Sarah’s appointment.The Board has since discovered the loan contract and has stopped all repayments on the loan. The Bank has called in the loan and is suing Sparklingfor the principaltogether with all outstanding interest.(a)What do you think the outcome of this case will be?(b)What do you think the outcome of this case shouldbe?(c)Would the outcome of this case be different if:(i)the loan was for refurbishment of two of Sparkling’ clothing shops; and(ii)the bank’s loan officer knew Sarah had fallen out of favour with the Board and was negotiating a new job?
read lecture note : 9 (for question number 2)