2.At Your Service Pte Ltd is a big company which provides various travel related services, including overseas tour packages which are designed in-house. Tom, a customer, had booked a special in-house tour for 2 to Bali. Tom had booked the tour as he wanted to go to Bali for his honeymoon. However, subsequently Tom cancelled the booking as he broke up with his fiance. Tom had paid the sum in full as per the contract.
However, the contract also provides that, if a cancellation is received 1 month before departure, 20% of the sum would be forfeited, if a cancellation is received 2 weeks before departure, 50% of the sum would be forfeited, if a cancellation is received 1 week before departure, 75% of the sum would be forfeited and if a cancellation is received at any time less than a week before departure, 100% of the sum would be forfeited. Tom cancelled the booking 3 days before departure. Tom nonetheless wants the full sum he paid returned, on the ground that he has not used any of the services. (Exam 09)
3. Perfect Timing Pte Ltd agreed to sell a machine to Sosway Pte Ltd at $20000. Delivery was to be on the 1st. However, when the 1st came, Perfect Timing Pte Ltd did not supply the machine to Sosway Pte Ltd and repudiated the contract due to various problems on its end. Sway Pte Ltd had wanted to use the machine for the production process. Thus far it had been using another machine for the production process, but on the eve of the 31st (the day before the delivery of the new machine), the old machine was sold and delivered to a third party. As a result Sosway Pte Ltds production came to a stand still on the 1st. Sosway Pte Ltd managed to get another similar machine from some other source within 21 days of the breach.
(a) What damages can Sosway Pte Ltd claim for? (b) Is there anything Sosway Pte Ltd could have done prior to entering into the contract which would have improved its position? (c) Does the concept of mitigation make business/practical sense?
4. On the 1st of May, Sweendal Pte Ltd, a van dealership company, entered into a contract with Mind Changers Pte Ltd, under which Mind Changers Pte Ltd agrees to buy a commercial van for $130000. On the 2nd of May, Mind Changers Pte Ltd cancels the order as it cannot get the financing. The market price of the van has remained the same. (a) What are Sweendal Pte Ltds remedies?
(b) What if Sweendal Pte Ltd collected a deposit of $5000 and the contract provided that all deposits are non-refundable and will be forfeited if the buyer cancels the order? (c) Considering your answers in (a) and (b), would it be wise of Sweendal Pte Ltd to have a non-refundable deposit clause in the contract?
5. Mann Shan is a landlord and has rented out his premises to Payne. The contract prohibits sub-letting. Payne sublets the premises and has earned $30,000 profits in the process thus far. Advice Mann Shan who is unhappy. Market rates for rentals have gone up.
6. Deeva is a famous pop star who has been engaged by Show Off Productions to do a concert in Singapore. Thus far, Show Off Productions has spent $50,000 in promotions and all the tickets have been sold out. After this, Deeva cancels the concert as she has some other more important engagement.
(a) Assuming if the concert had gone on, Show Off Productions would have made $200000 in net profits, advise them as to the damages they can recover from Diva. (b) What if the Show Off Productions cancelled the show (after Deeva cancelled it) before any of the tickets were sold and before any expenses were incurred? What can they sue for? Can they sue for damages for lost reputation?
7. J Pte Ltd entered into a contract with T Pte Ltd under which the latter is supposed to deliver some complicated custom made software. Can T Pte Ltd sub-contract part of the job to R Pte Ltd? What if R Pte Ltd, does something wrong in the process can J Pte Ltd, sue T Pte Ltd in respect of that? If J Pte Ltd did not want the contract to be sub-contracted, what could it have done? Generally, what could be some reasons, why you do not want the contract to be sub-contracted?
8. Generally only parties to the contract can sue and be sued. However, in the following cases, are X and Y parties to the contract:
(a)Z is an authorized agent for P type of cars in Singapore. The manufacturer is Y in Germany. X goes to Z and buys a P car. Is there a contract between X and Y? (b)Z sells hand phones and is the authorized agent for Y, a mobile phone service provider. X goes to Z shop and buys a phone and signs up to receive mobile phone service from Y. Is there a contract between X and Y? (c)Z is a maid agency. Y is a maid. X goes to the maid agency and chooses Y. Is there a contract between X and Y? (d)Z is a modeling agency. Y is a model. X goes to Z to get models to perform for an event. The models include Y. Is there a contract between X and Y?
9. Search web sites containing legal/contractual terms. Can you find an example of :
(a)a liquidated damages clause . (b)a clause dealing with or prohibiting sub-contracts or assignments
Note: such exercises are important to understand and appreciate that what you are studying is not something just theoretical but arises in real life.