Contract Law Master Case Study Example | Topics and Well Written Essays - 3500 words

Contract Law Master - Case Study Example This was also the case in Goedecke v Kirwan1where the Court found that an agreement on price was a necessary term of offer and acceptance; hence no final, enforceable contract existed since price had not been agreed upon. Thus Hilary may have some rights under the option, but they may not be fully enforceable. In the case of Barack, he seeks re-possession of his flat. Under the option clause in the agreement, Barack may not have the automatic right to reposses the flat, when there is an option available to the lessee to continue. In the case of Butts v O'Dwyer2 a similar situation arose, where there was an option to purchase the lease property subject to fixing of a price by the third party. In this instance, the Court concluded that it could correctly be said that the complete was incomplete until the price was fixed. The existence of the option indicated that the owner had an obligation to do everything in his power to ensure that the price was fixed through the third party. This is applicable in Hillary's case, since Clauses 5(d) and 17(b) lay out the procedure for fixing of the price in the event an agreement cannot be reached between the parties. ... at Hillary seeks, it may nevertheless place an obligation upon Barack to take necessary steps to ensure that the incomplete term in the contract, i.e, the price is fixed. In the case of Booker Industries Pty Ltd v Wilson Parking (Qld)Pty Ltd3 the situation was very similar to Hilary and Barack's case. In this case, the Court specifically stated that Booker (the lessor in this case) had "no grounds for refusing to discharge its obligation" to appoint an arbitrator merely on the grounds that the rental price was not fixed4. It clearly explained that when specific terms on the appointment of a third party have been set out in the original contract, then it no longer remains as a contingent obligation to be performed first before the ultimate obligation, i.e, re-renting the place can be completed. Since the existing option becomes operation on the day of expiry of the earlier lease, once it has been exercised, it is no longer a "conditional or contingent" obligation5. On this basis, the lessee was entitled to specific performance. Applying this precedent in Hillary's case, it appears that Booker may need to perform his obligation to appoint an arbitrator so the price can be fixed, after which the ultimate obligation, i.e, another lease term can also be accomplished. It must also be noted however, that Clause 4(b) states clearly that the option must be exercised "no later than 2 months prior to the expiration of the initial or previous term". In Hillary's case however, the option has been exercised after this period has expired, therefore there is a possibility that her right to exercise her option may no longer be valid, in which case Barack will not be obliged to perform his obligation to secure a rental price. Part B: The question of whether or not Huckabee has a