Question

.Belinda wants to buy a second-hand car and visits a number of car dealers before deciding to purchase an as new 1998 Ford Mustang from American Car Sales. The sales person, Jaxson, tells Belinda that the car was manufactured in 1998 and had only done 54,000 kms. Three months later, Belinda has the Mustang serviced with her local mechanic who was a Mustang enthusiast. He comments on the fact that the car was in pretty good condition for a 1994 Mustang, though he was surprised that it had only done 54,000 kms. He would not have been surprised if it had done 100,000 kms. Belinda makes further inquiries and discovers that the Mustang was in fact made in 1994 and she has paid about $5,000 more than the actual market value of the car. Belinda intends to approach American Car Sales about this issue. Does Belinda have any contractual rights against American Car Sales? (10marks) Required: You are expected to discuss legal rules learned regarding terms of a contract, in particular statements and representations, and conditions and warranties.

Answer 1

This question deals around with the statement made by a seller to a buyer, and whether they are mere representation or can be place as a a condition or warranty to the buyer

Explanation:

The case can be analyzed using the IRAC method as follows

ISSUE-whether the statements made by Jaxon were contract terms, and if so,whether this represents a warranty

RULE-The law states that one may breach a warranty or oral representation if you give a buyer a promise, and they rely on it to their predicament, if these words are false and misleading

APPLICATION-With reference to the case, 'Dick Bentley productions ltd vs Harold Smith Motors', false statements which are made based on warranties are a condition to the seller,and are a representation of a warranty to the buyer.

CONCLUSION-Belinda can successfully sue Jaxon for the damages incurred as a result, because the words made by Jaxon are a warranty given to her for assurance. Since she relied on the information in making the purchase, she incurred the damages, and should be compensated

Yes, Belinda certainly have contractual rights against American Car Sales. As per the contract, Belinda was entitled to receive a 54,000 Km run 1998 Ford Mustang but instead received a 1994. It counts as fraud on part of American Car sales as they intentionally delivered a product different from what was mentioned in the contract while receiving the complete due amount. If and when brought in front of the court, Belinda would be entitled to receive the difference in value of 1994 and 1998 models of the car. Also, she can sue for further damages and their intention of fraud.