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TABL 5543 Business and Company Law Individual Assignment Topic 

Question [20 marks]
Tom and his younger sister Louisa (aged 17) inherited some money from their
grandmother. They decide to buy a holiday house at Brooms Head, New South Wales.
Louisa contacted a real estate agent in the Brooms Head area, inquiring about houses
for sale within walking distance of the beach.
In November 2023, real estate agent, Angela, sent Tom details of a house for sale that
he liked the look. Without discussing it with Louisa, he decided it would be a good
house to buy. Tom was not able to go to Brooms Head to inspect the house. Angela
sent him a copy of the contract of sale and told him a condition report had been done
by ‘All Conditions Far North Pty Ltd’ for a potential buyer, Corey. Corey had not
proceeded because his loan application was declined. Angela sent the report to Tom.
Tom read the report.
Tom was concerned about the risk of flooding from the nearby river. The condition
report did not mention flooding, but a flood certificate was attached that had been
obtained from the Brooms Head Local Council. It contained a flood map that was quite
unclear and was dated 2016. Tom asked Angela about flooding. She said, “there’s no
risk at Brooms Head, that river behind the beach never overflows its banks”.
Tom explained to Angela that he and Louisa would want to rent the house out to holiday
makers every holiday. They would need to earn at least $2,000 per week for rental for
12 or more weeks a year. The agent said, “no problem!” Houses up here are always in
demand for the whole summer. It’s a surfing paradise.
Tom decided he and Louisa should buy the house. Tom asked a buyer’s agent, Jimmy,
to negotiate the purchase. Tom emailed the details of the house to Jimmy and wrote in
the email that Jimmy was to buy the house in the names of Tom and Louisa. Jimmy
was not authorised to offer more than $400,000. Jimmy got carried away and made a
successful offer of $500,000 for the house.
Before the purchase settled the river flooded. Water severely damaged the house. It
turned out that the Brooms Head Local Council had supplied the wrong flood map to
All Conditions Far North Pty Ltd and that the river had also flooded the house in 2021.
The extent of that flood showed on the council’s updated map. Tom realised that even
if he and Louisa could afford the $500,000, the house would not be able to be let for
many months while the damage was repaired.
(a) Advise Tom whether he can avoid the contract and whether he can sue
Jimmy, Angela or the Brooms Head Local Council. If so, what is the legal
basis for for any claim and the chance of him succeeding?
[16 Marks]
(b) Advise Louisa whether she has any liability under the purchase contract.
[4 Marks]
2
End of Question
Hints:
1. Your answer must address relevant legal issues raised in Business Law (Part A of the
course). The question draws on selected material covered up to and including the Week
5 lecture topic.
2. Your answer must refer to provisions of any relevant statutes and precedents in
support of your answer. They can be found in relevant chapters of the prescribed
textbook and in the lecture slides.
3. If more information/facts are required to that given in the stated question, you may
make reasonable assumptions, and state the need for those assumptions, if any.
Unrealistic/fanciful assumptions will be penalised.
4. Pay attention to the Marking Rubric (at Moodle) prior to submission of your answer.
Marking Guide:
See the Marking Rubric at Moodle.
Superficial answers (simply based on issue-recognition, inadequate application of law to the
given facts [ie. Misuse of 5 Step Plan if adopted] and uncritical legal analysis will attract a bare
pass mark.
Marks will also be deducted for poorly structured answers and evidence of absence of proof-
reading the paper before submission or failure to consult the Style Guide (located at Moodle).
Using software such as Grammarly to edit your work is acceptable but you must acknowledge
its use in the assignment upon submission.
Important: Use of Law Teacher, Wikipedia, and other similar websites is prohibited as they
are not a reliable/credible source of information.
You must submit your own work (unassisted by ChatGPT or other AI devices).