BLO1105 – Business Law

1. BLO1105 – Business Law Welcome to Business Law BLO1105 – Business Law

2. LECTURERS CITY FLINDERS Adv Andy Schmulow (Subject coordinator) Dr Daud Hassan (Senior Lecturer: Victoria Law School) FOOTSCRAY PARK Mr Gerry Box (Co-author: Parker and Box) BLO1105 – Business Law

3. Contact Details: Andy Schmulow • Flinders Street Campus Room 1030 Phone 9919 1483 • Email Andy.Schmulow@vu.edu.au BLO1105 – Business Law

4. Contact Details: Dr Daud Hassan • Queen Street Campus Room 1.05 Phone 9919 1857 • Email Daud.Hassan@vu.edu.au BLO1105 – Business Law

5. Contact Details: Gerry Box • Footscray Park Campus Room 32.42 Phone 9919 8275 • Email Gerald.Box@vu.edu.au BLO1105 – Business Law

6. Subject Outline • An Introduction to the Australian Legal System. • A detailed study of the Law of Contract. All Business Graduates and their advisers should have a sound understanding of Contract Law principles. BLO1105 – Business Law

7. Assessment Summary Check Subject Guide p. 2. This is definitive and serves as a contract between you and the University. NOTE: TUTORIAL PARTICIPATION IS COMPULSORY AND YOU MAY NOT MISS MORE THAN TWO (2) TUTORIALS. IF YOU DO YOU AUTOMATICALLY FAIL BLO1105 – Business Law

8. Tutorials Tutorial attendance and participation. Your attendance at andyour level of participation in Tutorial discussions will be monitored and recorded by your Tutor. At the end of semester, you will be allocated a mark out of a possible 10%. WHAT HAPPENS IF YOU MISS MORE THAN 2? BLO1105 – Business Law

9. Assignment You are required to submit during your scheduled tutorial in the week commencing Monday 27th April, 2009 a written assignmentor research essay of 2,000 – 2,500 words on the topic in the Student manual for Semester 1, p. 17. NOT SEMESTER 2 TOPIC p. 18. You will receive a mark out of a possible 25. BLO1105 – Business Law

10. Final Examination The final examination is a 3 hour exam, and is “Open Book” You may take into the exam any written or printed materials, and use them to assist in answering the questions, which are problem-based. Marks are out of a possible 60% BLO1105 – Business Law

11. Teaching Method Two hours of lectureseach week. Check timetable details of lectures Tutorials. You must also attend One tutorialof one hour’s duration each week. TUTORIALS ARE COMPULSORY YOU MAY NOT MISS MORE THAN TWO (2). IF YOU DO YOU AUTMOTAICALLY FAIL BLO1105 – Business Law

12. Materials Student Manual. The “Business Law Students Manual”is an essential requirement for students. Cost is about $12 or from E Reserve or WebCT . It is available at the Bookshop, and contains the Subject Outline, Syllabus details, Tutorial programs and other materials, including past exam papers. BLO1105 – Business Law

13. Materials (Continued) Textbooks. The officially prescribed texts are “An Introduction to the Law of Contract” by Stephen Graw, 5th ed., and “Business Law for Business Students”, Parker & Box,2nd Ed., in VU bookshop for $98.88 as a package. If bought individually, Graw is about $72.10 and Parker & Box is about $41.58 BLO1105 – Business Law

14. Materials (Continued) “How to Study Business Law” Crosling & Murphy, Butterworths. Lecture Notes Summary. Available at VU Library on Electronic (“E”) Reserve, or from the Faculty website. PowerPoint slides are available on the WebCT website. BLO1105 – Business Law

15. Student Support Programs The Teaching and Learning Unit conducts various programs during the semester to assist students with assignment preparation and examination preparation. Details of these classes will be announced in lectures at the appropriate times. BLO1105 – Business Law

16. Australian Legal System Some knowledge is assumed. Week 1 & 2 Lectures will overview this area, focusing on: - • The evolution of Australian Law • The sources of law • The “common law” • The “doctrine of precedent” BLO1105 – Business Law

17. Australian Legal System • Law reporting systems • The “adversary system” • Federal system of government • State & Federal Court structures • The Commonwealth Constitution • Legislation and how to interpret it. BLO1105 – Business Law

18. Evolution of Australian Law Following “settlement” by the English in 1788, the English “common law” model was imposed in Australia. As a penal colony, martial law prevailed. English law then applied from early 19th Century until late in the 20th Century Many English concepts survive today. BLO1105 – Business Law

19. Evolution of Australian Law Australian law gradually developed its own “flavour” as an offshoot of English law Finally, we severed our ties with English law, but only recently. Result is a system heavily based on English law, but now completely independent of it. Processes and precedents still apply today BLO1105 – Business Law

20. Sources of Law in Australia Primary Sources • Legislation, and • Precedent Secondary Sources • Commercial Custom • Legal textbooks and journals • Law Reform Commission Reports BLO1105 – Business Law

21. Primary Sources of Law Legislation comprises • Acts of Parliament (“Statutes”), • Statutory Rules & Regulations, and • other “Delegated Legislation”. For us as Victorians, this means both Australian and Victorian legislation BLO1105 – Business Law

22. Primary Sources of Law Precedent is “judge-made” law, as distinct from law enacted by Parliament. It is law as pronounced by the courts when deciding cases over many years. Legislation prevails over the common law. Parliament has the final say as to what the law is in any area. BLO1105 – Business Law

23. The Common Law This term is used to describe • A type of legal system. (Contrast “common law” and “civil law” systems, for example) • The body of decisions made by courts over time that collectively comprise the “common law”. (Cf “Legislation”) BLO1105 – Business Law

24. The Doctrine of Precedent Inherited from the UK, it means that decisions of superior courts in a legal system (or “hierarchy”) are binding on inferior courts in the same hierarchy. The Supreme Court of Victoria binds other Victorian Courts, because it is our (State) superior court. The High Court of Australia binds all Australian Courts. BLO1105 – Business Law

25. Advantages of Precedent Properly applied, the courts become • Consistent, • Non-discriminatory and fair, and • Predictable in their decisions Some disadvantages apply. There is a “safety valve” in the operation of the doctrine. BLO1105 – Business Law

26. Law Reporting Systems Vital to Precedent, the (printed) Law Reports recorded all significant legal judgments for future reference.They are very relevant to Contract Law, which is not “codified”. CLR and VR are important to Victorians. Meehan v Jones (1982) 149 CLR 571 Causer v Brown [1952] VLR 1 BLO1105 – Business Law

27. Useful Websites Students should note two particular websites that are extremely helpful in tracking down Statutes and Cases. All High Court cases and Acts can be found on http://www.austlii.edu.au All recent Victorian cases and Acts can be found on http://www.dms.dpc.vic.gov.au BLO1105 – Business Law

28. The Adversary System All “common law” countries adopt the adversary system in conducting trials. “Civil law” countries use the “inquisitorial” approach. Differences include:- • The role of the judge; • Onus & burden of proof, and • Somepresumptions, eg “innocence”. BLO1105 – Business Law

29. The Australian Constitution This is the “charter” for operation of our “federal” system of government. Adopted by a majority of people and States in 1900, it has operated since 1901 more or less unchanged. Federal systems (cf. “unitary” systems) exist in many large countries, e.g., USA, Canada. BLO1105 – Business Law

30. The Australian Constitution This results in having • two law-making authorities (Commonwealth and State), and • a division of law-making powers between the two. Many complications arise from this, causing conflicts between the two governments. The constitution enshrines the UK concept of the “separation of powers”. BLO1105 – Business Law

31. Federal System of Government Every federation has the problem of two (competing) law-making authorities. Unitary systems (the majority of countries) do not have this problem. When confronted with a legal problem, we have to check both • Commonwealth (Australia-wide) laws, as well as • State (Victoria-wide) laws BLO1105 – Business Law

32. The State Court System The State Courts are • The Court of Appeal (the “Full Court”); • The Supreme Court • The County Court • The Magistrates Court. • Various Tribunals, including VCAT BLO1105 – Business Law

33. The Federal Court System The Federal Courts are • The High Court of Australia • The Family Court • The Federal Court • The Federal Magistrates Court The Federal & Family Courts, created in 1976, rank equally in importance. BLO1105 – Business Law

34. Tribunals Tribunals have succeeded because • They provide quick and easy access • They are not as expensive as courts • They are informal, and • They are very efficient. Rapid growth reflects their popularity. BLO1105 – Business Law

35. Statutory Interpretation Interpreting Acts is now the main function of courts, rather than creating new law, which is now mostlydone by parliament. Problems include • Human error in drafting • Rapid technological change • Changes in words and community standards BLO1105 – Business Law

36. Common Law Rules (of interpretation) The Courts developed three main Rules to assist in interpreting Acts:- • The Literal Rule, • The Golden Rule, and • The Mischief Rule. Many “Maxims” (rules of lesser importance) were also developed by the Courts. BLO1105 – Business Law

37. Statutory Rules (of interpretation) Recently, (1984) Parliaments gave their own instructions to the Courts about this task. They passed legislation to require the courts to use the “literal rule” when reading and applying statutes. If that creates a problem, the courts then must use the “purposive approach”. BLO1105 – Business Law

38. The “Purposive” Approach If in doubt (as to what the words mean), the judge must ask • “What was the purpose of this Act?”, or • “Why was this Act passed?” The judge must then interpret and apply the Act to give effect to that purpose. BLO1105 – Business Law

39. Different Branches of Law One main division or distinction is between civil law and criminal law. Civil law involves claims by one citizen against another in the litigation process. Criminal law involves the prosecution of a citizen by the state (police) for a crime. BLO1105 – Business Law

40. The Law of Tort A “tort” is a civil wrong for which the remedy is an action for damages. Examples of torts are negligence (the most common tort), defamation, nuisance, trespass and deceit. BLO1105 – Business Law

41. Contract Law Contract law is the law concerning legally enforceable agreements. It is the “cornerstone” of all of our commercial or business law. We study it intensively simply because we are students of business. We will work in business or advise people who do. BLO1105 – Business Law

42. Constitutional Law Constitutional Law is the study of the constitution, in our case the constitution of the Commonwealth of Australia. This involves the relative powers of the Commonwealth (Australian) and State Governments, disputes between States, between States and Commonwealth. BLO1105 – Business Law

43. Administrative Law Public servants can now have their decisions tested by citizens through various tribunals. Formerly, only the legality of the decision could challenged. Under administrative law, the correctness of the decision can now be challenged and reviewed by the tribunal. BLO1105 – Business Law

44. The Rules of Equity Different in origin from the “common law”, equity developed in the “King’s Court”, later taken over by the Chancellor, and became known as “Chancery Courts”. The rules of natural justice (as distinct from common law rules) were applied. The two systems have “merged” in all out courts. BLO1105 – Business Law

45. Further Reading “Business Law for Business Students”, pages 1 – 53; or The Introductory Chapters of either “Business Law in Australia”, Vermeesch & Lindgren, or “Australian Business Law”, Latimer, CCH. BLO1105 – Business Law

46. Contract Defined A contract is • An agreement that the law will enforce; • A promise (or set of promises) that the courts will enforce; or • A legally enforceable agreement. All emphasize “agreement” (or set of promises), and “enforceability”. BLO1105 – Business Law

47. Contract Formation Formula Many problems require us to say whether a contract exists. To resolve this, a useful formula is Offer + Acceptance = Agreement Agreement + Intention + Consideration = Contract BLO1105 – Business Law

48. Typical Formation Process The vast majority of contracts are formed by the process outlined. An offer is made by A to B. That offer (or some negotiated variation of it) is accepted by B. Agreement exists. (Courts still typically apply this test.) BLO1105 – Business Law

49. An Exception to the Rule In Clarke v Dunraven [1897] AC 59, the Court of Appeal held (decided) that agreement had been achieved between C and D. They had each advised a “third party”, the secretary of a Yacht Club, that they would be bound by the Club’s rules in the conduct of yacht races. BLO1105 – Business Law

50. Introductory Points (about contract). • Contrast “Simple Contract” and “Formal Deed”. • Does the contract have to be in writing? • Doctrine of “part performance”. • How to prove terms of “verbal” contract? • Contrast bilateral and unilateral contracts. BLO1105 – Business Law