Australian Business Law. A Case Study

Essay, 2015

4 Pages


Nick and John

In this case, Nick needed the rally to be flawless therefore, he promised to give a bonus of $1000. Having paid $5,000 meant that nick was not paying the full payment as agreed. However, the considerations and discharge of obligation meant that the rule in Pinnel’s case could be applied to ensure that nick paid back the remaining amount[1]. In this case, the consideration could be defined as the price a promisor would pay for the actualization of the promise. Being an essential element of a contract means that the agreement was enforceable in a court of law as it was a binding agreement. Therefore, Nick could sue Nick for the remaining amount as settlement of a lesser amount does not warrant that the rest of the amount could be paid at any time. Using William v Roffey bros. & Nicholls, precedents were set as the contractual obligation agreed upon in the agreement resulted in commercial advantages for the defendant[2]. This held the defendant under duress to ensure that he settled the additional sum agreed upon. According to this, the payment agreement meant that the additional sum was enforceable according to the law. Consequently, John could be held at duress to pay the amount he owed Nick as he owed him an amount that amounted to smooth running of the rally. Similar to this is the Stilk v. Myrick case, which would have allowed the plaintiff to hold any progress in the project until the defendant paid the remaining amount in full[3]. Clearly, the contractual claim in this case was highly related to the practical benefits exception

Nick and the police

The police in the country are required to perform various duties according to the constitution. Among these duties is the enforcement of law, where they are supposed to deal with behaviors that violate the law by arresting them and using other means that are allowed constitutionally. In addition, the Australian police are required to maintain order by taking preventive, as well as controlling measures in situations that threaten or even disturb the peace and well-being of the people[4]. Conclusively, the police are also supposed to take steps that make it easy to gather information by asking the routine questions at the crime scene so as to establish the causes of various events that affect the people. Clearly, the policy were therefore, legally bound to provide protective services to the people attending the rally even without any promise of being paid. Therefore, Nick could argue that it was in their duty to protect the people that attended the rally. However, the important fact to note in this case is the fact that the Nick was asking for additional protection from the radical groups that would be against his movement. Though different some similarities may be drawn from the Glasbrook Bros Ltd v Glamorgan county Council where police constables were placed during a strike to ensure that there were no disruptions in exchange for financial contributions[5]. The judge in that case stated that, “it will be adequate consideration where what is given is more than could have been expected from performance of the existing duty, where in fact something extra is added to what the claimant is already bound to do[6].” The case provides precedents for such cases by stating that individuals that ask for special protection in addition to the usual duties that the police normally carried out had to pay for the services. This case lays it down that even through an adjudication process, Nick will have to offer the promise that he had offered when asking the police to offer extra protection.

Nick and Hanson

Hanson offered to his support free of charge. He had not expected the costs involved in this case to be too high. Generally his services were expected to serve as gifts as they were free of charge. This meant that Hanson could not raise the issue in case in court as no consideration would be made to ensure that the cost were effectively reimbursed. However, being a committed supporter, Nick made considerations of ensuring that he kept his supporter satiated with the full event. This explains why he agrees to reimburse the full amount at a later date. Most cases dealing with social agreements agree to the fact that social agreements are agreements between people that are social to each other mainly family and friends, which do not create any legal relation between the parties involved[7]. The doctrine created under this was created to prevent some agreements from being enforced. Though these agreements satisfy the definition of offers, their acceptance and gradual communication between the parties involved in the case. Clearly, Hanson cannot use any legal path to ensure that Nick paid his end of the deal as it was a social agreement between the two arising from a gift offered by one of the party in the case. Consequently, even though Nick does not keep his end of the social agreement, the court cannot come in between to ensure that it is implemented. Consequently, the fact that the initial service provided was considered as a gift and the final agreement being established as a social agreement that does not have any legal relations means that Hanson cannot hold Nick under duress to reimburse the full amount that he spent during the rally.

Nick and Ian

Ian wrote a letter to Nick offering him his support as he was one of his prominent sympathizers. However, having declined to offer him the money promised through the letter, it could be taken into critique to establish the legal position that John was in to enhance his case. Generally, for two parties to enter into a case there has to be an offer. An offer was defined as “a statement of the terms upon which the offeror is prepared to be bound if acceptance is communicated while the offer remains alive[8]. Therefore, for an offer to remain valid, there has to be communication to the offeree, who in this case is Nick by the offeror. However, in this case, the offeror did not go ahead with the offer meaning they were not bound by the contract as he was only a sympathizers and supplied information to the other party, which did not mean necessarily that they entered into a contract. Having been a social agreement from a sympathizers, the Ian could not be held under duress to pay the amount that he was to pay as they had not entered into a legally binding contract between the two[9]. Also, the will and intent has to be present for there to be a legally binding contract between the offeror and the offeree. However, the will and intent in this case reduced relieving the Ian from the duty of baying as it was no longer termed as a contract. On top of this, the equitable estoppel could be established to protect Ian from having to pay for the expenses had it been interpreted as an offer[10]. For instance, the Glasbrook Bros Ltd v Glamorgan county Council case ruled that an offer could be revoked provided that the offerer provided sufficient information. In accordance with this, Ian stated that he was no longer able to cater for the cost of the rally as his company had exhibited a decline in profits. As such, he could not be compelled to pay the entire price while his main source of income had reduced significantly.


Clearly, the different situations call for different course of actions depending on the legal positions that the activities hold. To begin with, John is found to be able to ask for his bonus as he had effectively completed his duties as agreed upon. The consideration provided was a major consideration as it resulted in added advantages for Nick. Therefore, the court would rule in favor of nick as they had entered into an agreement. In the second case Nick is also supposed to pay for the additional services offered. This arises from the precedent set by the Glasbrook Bros Ltd v Glamorgan county Council where the defendant was supposed to pay as originally agreed. In the third case, Nick and Hanson were found to be in a social agreement, which did not discuss any legal relation between the two. Therefore, even if Hanson would go ahead to seek legal adjudication to have him compensated the court would not make any consideration. The final case also concludes that Ian is not liable to paying as agreed upon as he had not made an offer. Rather, he had supplied relevant information which did not bind him. In addition to this, the doctrine of equitable estoppel made it clear that he did not have to pay as he had provided a sufficient reason to revoke his offer.


Mukherjee, S. K., & Graycar, A. 1997. Crime and Justice in Australia, 1997. Hawkins Press.

Radan, P. & Gooley, J. 2010. Prnciple of Australian Contract Law (2nd ed.) LexisNexis Buttersworth

Bryan, M., & Vann, V. 2012. Equity and trusts in Australia. Cambridge University Press.

Dysart Timbers Ltd v. Nielsen, 2009 N.Z.S.C. 43 (2009).

Glasbrook Bros Ltd v. Glamorgan County Council, 1925 A.C. 270 (1925).

Stilk v. Myrick (1809) 2 camp. 317

Williams v. Roffey Bros. & Nicholls (constractors) Ltd (1990) 2 W.L.R. 1153

Pinnel's Case, 5 Co. Rep. 117, 77 Eng. Rep. 237 (1902).


[1] Pinnel's Case, 5 Co. Rep. 117, 77 Eng. Rep. 237 (1902).

[2] Williams v. Roffey Bros. & Nicholls (constractors) Ltd (1990) 2 W.L.R. 1153

[3] Stilk v. Myrick (1809) 2 camp. 317

[4] Mukherjee, S. K., & Graycar, A. 1997. Crime and Justice in Australia, (Australia:Hawkins Press 1997)

[5] Glasbrook Bros Ltd v. Glamorgan County Council, 1925 A.C. 270 (1925).

[6] Ibid.

[7] Radan, P. & Gooley, J. Prnciple of Australian Contract Law (LexisNexis Buttersworth 2010)

[8] Radan, P. & Gooley, J. Prnciple of Australian Contract Law (LexisNexis Buttersworth 2010

[9] Dysart Timbers Ltd v. Nielsen, 2009 N.Z.S.C. 43 (2009).

[10] Bryan, M., & Vann, V. Equity and trusts in Australia. (Cambridge University Press, 2012).

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Australian Business Law. A Case Study
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Enkai Zhang (Author), 2015, Australian Business Law. A Case Study, Munich, GRIN Verlag,


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