LEGAL PRACTITIONERS ADMISSION BOARD
AUGUST 2000
TRADE PRACTICES LAW
TIME: Three Hours. Candidates are required to attempt BOTH questions.
The questions may be answered in one examination booklet.
Candidates must indicate which questions they have answered on the cover of the first examination booklet.
Each page of each answer must be numbered with the appropriate question number and part number.
Candidates must write their answers clearly. Lack of legibility may lead to a delay in the candidate's result being given.
Permitted Material: No materials are permitted in the examination room.
A copy of the Law Extension Committee’s Case List is attached to the question paper.
As some instances of cheating and of bringing unauthorised material into the examination room have come to the attention of the Admission Board, candidates are warned that such conduct will result in instant expulsion from the examination and may result in exclusion from all further examinations.
Question 1. (60 Marks)
Answer ONLY THREE (3) parts of this question. Each part carries equal marks.
PART A
Pop Limited supplies corn to retailers. It charges $200 per ten dozen case lots, $30 per dozen case lots and $4 per case lot. It sells to supermarkets (which normally buy in ten dozen case lots), large greengrocers (which normally buy dozen case lots) and small shops (which usually buy case lots). There is some saving in delivery costs to larger buyers. Pop Limited offers a further discount of 20% to buyers who take all their requirements of corn from it.
In what circumstances will s.47 of the Trade Practices Act be infringed in this context?
PART B
The Workstyle Association of Australia, ‘the association’, has seventy members who together account for about 70% of the trade in pine office furniture designed by interior designers in Australia. Of all new and refurbished office premises furnished in Australia during the last seven years, 70% were fitted out with pine furniture. Prices for pine office furniture, in that time, have risen only in line with the consumer price index. Prices of other office furniture have fallen during the same period by 10%.
As a condition of membership of the association, members must participate in an interfirm comparison on prices which involves the exchange, on a strictly anonymous basis, of information about the prices charged for furniture, of production and of other financial information. Based on the interfirm comparison the association circulates a recommended price schedule to members.
A major developer of commercial premises is concerned at the price trends in pine office furniture and wants advice on whether the association is in breach of the Trade Practices Act.
Advise the developer with respect to Section 45 and Section 45A of the Trade Practices Act.
PART C
Eau Pty Ltd runs a large retail motor boat business. Jason is manager of the Canberra branch and James is chief salesman there. The latter makes various statements to Gordon in relation to a particular boat and in reliance upon these statements Gordon buys that boat. The statements made by James in this regard are as follows:
(Question 1 Part C continues)
(Question 1 Part C continued)
In fact only the hull, propeller, and anchor were manufactured in Australia although the boat itself, comprising many imported parts was assembled in Wollongong. The motor was assembled in the US and comprised mainly Japanese and Chinese parts.
In fact, none of Eau Pty Ltd’s employees were able to so so when it broke down six months after purchase by Gordon, and in fact the repairs were completed by a firm engaged by Eau Pty Ltd.
(c ) "The owner of the boat is entitled to an income tax deduction if he uses it for business purposes.’
In fact the Commissioner of Taxation refuses to permit Gordon to deduct any part of the cost of purchase or maintenance.
In fact Eau Pty Ltd refuses to do so when called upon.
Consider whether there have been breaches of the Trade Practices Act, in the light of the foregoing, under Part V Division 1 of the Trade Practices Act.
Part D
Write explanatory notes on ANY TWO (2) of the following:
(Question 2 follows)
Question 2. (40 marks)
Answer ONLY TWO (2) parts of this question. Each part carries equal marks.
Part A
Review the operation of Part V A of the Trade Practices Act in circumstances where the malfunction of a toaster at A’s house has caused injury, loss or damage to:
(a) to B who is a person visiting A’s house;
(b) to A’s property;
(c) to the family of B (who has been injured) due to B’s incapacity for work for period of 6 months.
Part B
Putter Pty Ltd has twenty mini golf courses in the Brisbane metropolitan area. There is one other competitor, Hot Dot Pty Ltd, which presently has four courses in operation: It is losing money, recently closed one course and will soon close one more. Three other companies entered the market two years ago but each lasted for only one year. Putter Pty Ltd has an agreement with McArthurs Meals (MM), a very large chain which leases premises to Putter Pty Ltd adjacent to MM’s drive up restaurants. Putter Pty Ltd’s competitors have found that it is difficult to get suitable sites by reason of Local Government planning restrictions.
Albatross Ltd, which runs mini golf in Canberra, is making a takeover bid for Putter Pty Ltd.
Does s 50 of the Trade Practices Act prevent the takeover?
Part C
Write explanatory notes on ONLY TWO of the following:
(a) The principles which apply to (I) the grant of injunctions pursuant to s 80 of the Trade Practices Act and (ii) the award of damages under Section 82 of the Trade Practices Act.
(b) The prohibition of resale price maintenance, in the light of s 48 and Part VIII of the Trade Practices Act.
(c ) Orders under s 87 of the Trade Practices Act.
(d) Relief available under the Trade Practices Act against unconscionable conduct.
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