Commercial Law

PART B

You MUST to answer two questions of the four questions listed below. Each question carries a weight of 20 marks.

Question 1:

"In commercial disputes, the need for flexibility outweighs all other considerations. To that extent, arbitration is the automatic choice"

Discuss this statement.

[20 marks]

Question 2:

Gareth is a shopkeeper. He is looking to purchase some new stock for his shop. He wants something eye-catching which he can put in the window to entice customers. He is wandering through his wholesale supplier and sees a sign advertising a “cat hairdryer”. It has a picture of a cat looking happy while an unseen owner is (apparently) blasting air at the cat from the dryer. Gareth speaks to the manager and says he would want 15, explaining that he needs them particularly to drive sales and to increase the referrals from cat owners, because of the amount of satisfaction cats will derive from it. The manager assures Gareth that the cat hairdryers are precisely what Gareth needs. Moreover, the manager says that if Gareth buys 20, he will also get a promotional billboard and a soft toy cat. This is exactly the sort of thing which Gareth thinks he needs and he agrees. They shake hands and Gareth pays.

Two weeks later, the 20 hairdryers turn up. The promotional billboard will not stand up properly in the window, and 5 of the hairdryers are slightly dented. There is a soft toy dog in the box. Gareth doesn’t sell any hairdryers in the first two days. When he removes the billboard and the dog, he sells 10 in the morning. However, of those 10, 7 are returned. The buyers all say that their cats won’t sit still when the hairdryer is switched on – as the hairdryer is making a high pitched whine which the cats obviously dislike. Gareth wants to know what his legal position and remedies might be against the wholesaler from whom he purchased the hairdryers. What are they?

There is no need to consider the position with the consumer purchasers in this answer.

[20 marks]

Question 3:

Sandra works in a gallery owned and run by Maxwell. She is very capable, and Maxwell tells her that he is keen to help her personal growth by giving her some greater freedom. He does, however, say that Sandra should make sure that she doesn’t sell anything in the shop which is “worth more than £150”, without his say so. Maxwell has to go out on an errand for the morning and leaves Sandra behind. The following things occur. Advise Sandra on her legal position in respect of each.

• Jessie comes into the shop and wants to buy a painting which has an asking price of £160. The painting is called “the Rising Tide”. Sandra knows that Maxwell has been keen to sell it, but most people hate it. It is big and takes up space on the wall. Sandra agrees to sell it for the asking price of £160.

• As she is taking the “Rising Tide” off the wall, the picture hook catches and punches a hole in the wall. It doesn’t damage the painting, but the hole in the wall is unsightly. Sandra rings her dad, who is a painter and decorator and has helped Maxwell in the past. He comes round, fixes the hole and leaves his invoice. He gives the gallery a discount on his normal commercial rate for the work, and it comes to £120. Sandra has the money from the “Rising Tide” in her hand (she hadn’t put it in the till yet) and pays him from the cash received from the “Rising Tide” painting.

[20 marks]

Question 4:

Charlie is a writer and Lola is an artist. They were friends, once, but things have recently soured between them with a focus on two particular issues.

First, Charlie used one of Lola’s pictures in an article he published on his personal website. The article was aimed at teaching the writing process to beginners. It was 750 words long. Charlie did not get paid for it directly, but he uses the website to publicise himself, and there is some advertising shown on the site which he uses to cover the webserver costs. Lola is outraged at this use of her picture – particularly because some of the advertising is for companies which she objects to on moral grounds.

Secondly, in retaliation for the first event, Lola has taken the 7-word phrase

-“you don’t stop being a good writer” from Charlie’s article. She incorporated the phrase into her new installation – emblazoning the phrase in blood red, 150cm high letters on the wall of a new office block in Glasgow.

Discuss the legal intellectual property remedies in these two situations – as between Charlie and Lola.

[20 marks]