Question

Melissa and Maui purchased a brand new house. They are both very excited about decorating the interior and the exterior of the house. Melissa plans to have everything colour coordinated. To match the navy blue wall paint, she orders navy blue ceramic vinyl floor tiles from Ceramic Tiles Fiji (CTF). Melissa placed an order for one hundred 30cm by 30cm navy blue ceramic vinyl square tiles. In order to process Melissa’s order, CTF required upfront payment of the entire contract sum of $7,000.00. Melissa attends to the payments on 3 May 2017. The terms of the agreement stipulates: “that the order will be processed within two weeks from the date of the receipt of full payment. That the tiles will be delivered within two weeks from the date of receipt of full payment. It also states that the purchaser has to exclusively engage the services of Delivery Fiji for the delivery of tiles.” Melissa feels it is quite unfair that they have to engage the services of Delivery Fiji and pay them a hefty sum of $100.00 for a very small distance. Melissa wanted to make her own arrangement for delivery at a much cheaper rate, however CTF objected to the same. On 30th May at about 9am some orders (tiles) were ready for delivery. These tiles were for three different buyers and one of them was Melissa. The other two buyers included one Smith and one Misha. The Delivery Fiji delivery truck was required to attend to the loading of the tiles at 9.30am. The tiles were packed in boxes and left at the delivery area at 9.05 am with the respective buyer’s initials and were ready to be transported to the buyers. Melissa’s navy blue tiles were packed in a navy blue box and the box was marked with letter “M” on top. There was another light blue box which had tiles for a different buyer Smith but it was unmarked. A purple box contained tiles for Misha and the box was marked with letter “M” on top. All boxes were coloured differently corresponding to the colour of the tiles in the box. Unbeknown to CTF at about 9.30 am, an intruder went into its delivery area and loaded one navy blue carton of tile and drove away. At that time the security officer of CTF who was supposed to be at the delivery area was out in the parking space attending to a relative. 20 Delivery Fiji truck reached CTF’s delivery area at 9.50am to take delivery of all tiles. The attending staff loaded the tiles in the delivery truck. They were provided with a list by CTF which had the three buyers’ addresses written in different coloured ink (light blue, navy blues and purple) corresponding to the colour of the carton of tile. Delivery Fiji mistakenly delivers the purple coloured carton to Melissa’s residence. Melissa acknowledges receipt by signing the delivery docket. The delivery docket had a clause which exempted Delivery Fiji from all forms of liabilities once the goods were safely delivered to its destination and the same was acknowledged. Melissa opened the box after two weeks when the tile layer arrived at her place to lay the tile and, to her dismay the tiles were not what she had ordered and expected it to be. It was not ceramic navy blue vinyl tiles instead it was plain light blue tiles. Melisa now wishes to return the tiles to CTF and claim her money and damages. CTF is disputing this by stating that the return of the sale period ended after 3 days from the date of delivery. Melissa further argues that they received a different order altogether and that CTF breached their agreement. CTF argues that the property and risk passed to Melissa once the tiles were packed and left at the delivery area. Melissa seeks to sue CTF and Delivery Fiji. CTF convenes a discussion with Delivery Fiji in this respect and finds out that only two boxes were loaded for delivery by them on that day. CTF carries out an investigation and the CCTV footage reveals that one box was stolen from their delivery area on 30 May at about 9.30am. Nevertheless they still insist that they are not liable to Melissa in anyway. Meanwhile Smith was declared a bankrupt on 2 May, 2017. Delivery Fiji had delivered the tiles to the address provided by CTF for Smith. Smith had made an instalment of $3,000.00 and he was supposed to pay the remaining balance of $5,000.00 to CTF upon receipt of the goods. CTF is demanding remaining payment from Smith. CTF argues that the property and the risk passed to Smith once the tiles were packed and left at the delivery area. Meanwhile Misha did not receive anything and she had paid $4,000.00 as deposit and was supposed to pay the remaining balance of $5,000.00 to CTF upon receipt of the goods.Write written submission addressing the following matters: 1. Did the property and the risk indeed pass to Melissa, Smith and Misha once the goods were left at CTF’s delivery area? 2. What remedies are available for Melissa and Misha? 3. Is Delivery Fiji liable to Melissa, Smith or Misha? 4. What remedies and defences will Delivery Fiji advance in its favour?5. What arguments will CTF advance in its favour to dispute the various allegations against them? 6. Can CTF be exempted from all liabilities or are they liable to the buyers for their loss. 7. What is Smith’s position in this respect taking into consideration his insolvency? 8. Are CTF and Delivery Fiji engaged in deceptive and misleading commercial practice? These Questions relates to Law of Commerce.

Answer 1

1 (a) In the case of Melissa the property and the rights over the goods had passed to her since the goods were handed over to the designated carrier as per contractual terms. It is true that the goods were delivered to her after the stipulated period of 14 days. But since she had accepted the delivery it is implied that she had agreed to accept the contravention of delivery period by the supplier. Besides Melissa opened the box containing the tiles 2 weeks after they were delivered to her. Therefore she did not reject the goods within reasonable time.

1 (b) Though Smith has become bankrupt the property and right over the goods will not pass to the reciever since he has not made the balance payment. Therefore though the goods are in the possession of Smith he is not the legal owner of the same.

1 ( c ) The property and right over the goods passed to Misha after CTF handed over delivery to the transporter as per contractual terms.

2. (a) Melissa has no remedies since the delivery docket states that all responsibilities of Delivery Fiji will cease after acknowledgement of reciept of goods is issued by the recipient. cannot claim delivery

2 (b) Misha can claim damages from Delivery Fiji.since she did not recieve any goods.

3. Delivery Fiji is not liable to Melissa, but he is liable to Misha. However he is not liable to Smith or his reciever, since Smith is legally bound to return back the goods to CTF.

4. Delivery Fiji does not have any defence against the claims made by Misha. In respect of Smith his ground of defence will be that Smith should return back the goods to CTF. Regarding Melissa his defence will be that she should have examined the goods before issuing the acknowledgement.