Question Tag: Legal Advice

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  • 10 Marks

BCL – May 2017 – L1 – Q1c – Contract Law

Define a ‘condition’ and ‘warranty’ in contract law, and advise on the validity of an exclusion clause in a hotel agreement.

c)

i) Define a ‘condition’ as in the law of contract. (3 marks)

ii) Define ‘warranty’ as in the law of contract. (3 marks)

iii) Keita books for a hotel facility and pays in advance. The hotelier tells him nothing more than the issue of a receipt. Keita takes occupancy of the room only to read a list of DONTS posted at the back of the door of his room. The following day he returned from breakfast in the hotel to find that his wristwatch which he left on the table of the room was missing. He spoke to the receptionist at the reception desk on the loss but they referred him to an exclusion clause on the door. He seeks your advice. Advise Keita. (4 marks)

i) A condition creates the fundamental obligations of the contracting parties. Breach of a fundamental obligation, i.e., a condition, by one party entitles the other party to repudiate. Or a condition is a vital term of a contract, going to the root of the contract, a breach of which entitles the injured party either to treat the contract as repudiated and terminate performance of the contract and claim damages for the termination or to affirm the contract and claim damages.

(3 marks)

ii) A warranty is a minor term. A breach of warranty entitles the other party to damages only. A warranty is not a vital term in a contract, but one which is subsidiary, a breach of which gives no right to treat the contract as terminated but only an action for damages.

(3 marks)

iii) In order to be valid the exclusion clause must pass the following tests:

  • It must be incorporated into the contract and not added after the contract is complete.
  • The customer must have adequate knowledge of the clause.
  • In the present scenario, the contract was concluded before the exclusion clause was brought to Keita’s notice.

(2 marks for any two points = 4 marks)

  • 20 Marks

BCL – May 2019 – L1 – Q5 – Agency, Sale of goods/hire purchase

Discusses the object of a sale of goods, legal advice for parties in a sale involving stolen property, and the duties of an agent.

Yaa Konadu purchased a car from Kofi Apenteng. Two months later, it was discovered that the car was stolen property before it was acquired by Apenteng, and both parties were innocent. Konadu had to give back the car through the police. Apenteng had no title to pass on, so Konadu sued him for the refund of the whole of her money despite the fact that she had used the car for two months.

Required: a) Explain if the object of the sale of the car was met for either Yaa Konadu or Kofi Apenteng.
(4 marks)

b) Advise the parties.
(6 marks)

c) Explain FOUR (4) duties of an agent to his principal.
(10 marks)

a) Object of the Sale:

  • The object of a sale of goods is to transfer the property from the seller to the buyer. In this case, no property was legally transferred to any of the parties because the car was stolen.
  • Legal Reference: Section 1(1) of the Sale of Goods Act, 1962 (Act 137) states that a contract of sale of goods is a contract whereby the seller agrees to transfer the property in goods to the buyer for a consideration called the price, consisting wholly or partly of money.
  • Conclusion: The object of the sale was not met, as Kofi Apenteng did not have the title to pass on to Yaa Konadu.

(4 marks)

b) Advice to the Parties:

  • Advice to Yaa Konadu: Under Section 8 of the Sale of Goods Act, 1962 (Act 137), the fundamental obligation of the seller is to deliver goods to the buyer after the sale. Since Apenteng had no title to the car, Konadu is entitled to a refund of her money. She is also entitled to damages for breach of condition.

    (3 marks)

  • Advice to Kofi Apenteng: The legal maxim “nemo dat quod non habet” applies, meaning no one can transfer a better title than they possess. Apenteng failed to confirm the legal ownership of the car and must repay Konadu her entitlements. He may then sue the person from whom he acquired the vehicle to recover his money.

    (3 marks)

c) Duties of an Agent: The duties of an agent to their principal include:

  • Acting on behalf of and being subject to the control of the principal.
  • Acting in good faith and not making undisclosed profits.
  • Acting within the scope of authority or power delegated by the principal.
  • Discharging duties with appropriate care and diligence.
  • Avoiding conflicts between personal interests and those of the principal.
  • Promptly handing over to the principal all monies collected on the principal’s behalf.

(4 points @ 2.5 marks each = 10 marks)

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