Effect of Deceptive Advertising on Consumption †MyAssignmenthelp

Question: Discuss about the Effect of Deceptive Advertising on Consumption. Answer: Introduction: A fundamental rule in the application of contract law requires parties to a contract to manifest their intention to be bound by the agreement. This rule dismisses the notion that typical negotiations can lead to a binding agreement. Sometimes, however, the partys actions seem so clear that they have agreed on the major terms. Later in the course of negotiations, disparities come, and talks break. One party sticks to that there was a contract, while the other distances itself from the claimed existence of the contract. This paper will be discussing such issues using one similar scenario. The paper will apply the various reasonings that different courts have employed to come up with a fair judgment. Both parties were negotiating a contract that broke when they were about to finish it. Parties had exchanged offers and counter-offers. Lianne had asked Mary to prepare a quote that she did, but the negotiations broke in the middle. Mary seeks to enforce the negotiations. This one is a matter as to whether negotiations for a contract can become binding on the parties. Negotiations involved the exchange of price quote that Mary sent to Lianne, and she relies on it to enforce the broken talks. It is common for parties negotiating a potential transaction to exchange preliminary agreements. However, the law can only enforce a contract where all the essential elements exist (Baird and Clare, 2017). An enforceable agreement requires an offer and acceptance. Apart from the two, the law requires the agreement to have a bargaining element and a manifested intention to create a legal bond (ChenWishart, 2013). In reality, the formation of commercial contract law becomes a process, and these elements do not appear following one after the other. The process starts with negotiations that sometimes take months to finalize. Parties agree to a point, and the next time they are forced to go back to the starting point. Despite the circumstances, there is always a general obligation to negotiate in good faith (Trakman and Sharma, 2014). In between the negotiations, some contracts may indicate instances of binding negotiations. Most of the cases involve written preliminary agreements. The exchange usually happens when parties intend to replace them with a written contract in the future (Mouzas and Furmston, 2008). However, the negotiations break before the completion of the anticipated formal written agreement. The complaining party alleges that there was a contract basing its argument on the exchanged preliminary agreement, while the other party dismisses the claim. The main problem is that there is no particular law for this exact matter. In (Beale, Bishop, and Furmston, 2008), the work states that such an issue requires the court to look at the wording of the preliminary agreement in question. The same applies to cases of unsigned preliminary agreements (Beale, Bishop, and Furmston, 2008). In either written or oral dispute, as to the preliminary negotiations, courts balance the contending interests of the parties. At the same time, courts avoid creating a contract for the disputing parties (Ravichandra, 2013). Nevertheless, the work of the court is to enforce the agreement if the wording suggests a binding agreement. In the search for the intent, courts employ different mechanisms. The first one is to examine the totality of the underlying circumstances. The primary approach is to use the available objective signs to find out whether the parties had agreed on the major terms. Here the courts look at the entire language (Prescott and Swartz, 2010). Places like New York have a multi-factor test for analyzing the available facts. Another method that the court may use is by examining what the parties did after the negotiations. Lastly, the court may interpret the disputed negotiations by examining the contested negotiations present tense rather than the future tense. Like explained above, there is no particular line for aligning such matters. Courts employ various rational mechanisms for a solution. One recent ruling is ( Hartslief v Terra Nova Royalty Corporation, 2013). Both the claimant and the defendant solicitors appeared to have come to a settlement of the claimants claim. However, the claimants employer argued that the joint intention of both parties was only to accept a binding agreement after a formal settlement. In addition, there were pending issues unsolved. The claim did not succeed as the court stated that the solicitors had the authority to create a binding agreement. The discussed case above seems to have borrowed the rationale in ( Bawitko Investments Ltd. v Kernels Popcorn Ltd, 1991). Although not the exact facts, this case appears to hold similar issue to the case of Lianne and Mary. Both cases are issues of preliminary oral agreement. What happened is that Bawitko was purchasing Kernels' Franchise. The defendant provided a contract that both parties agreed to amend. They shook hands and stated its a deal, and Bawitko paid $10,000 as deposit. When it came to signing the formal agreement, Bawitko was unreachable. At the deadline was when Bawitko responded requesting form an extension of the deadline. Kernels terminated the negotiations and refunded the deposit. Bawtiko brought an action for breach. The trial court ruled that the oral agreement was just a contemplation of the formal agreement and was not binding. The oral agreement was just a skeleton and did not hold all the terms of the agreement. The basic rule is that if the negotiations prove that the parties have agreed on essential provisions of the main agreement, the court can conclude that they have thereupon completed the requisites for their contract. Whether they would finalize the remaining parts of the main agreement does not change the binding rationale of the original terms. However, if parties intention has not been met, the negotiations remain unbinding. This rationale does not depend on whether the terms were certain or uncertain. The conclusion is that the quote was unbinding. First of all, a reasonable person would look at what happened after the quote. Lianne proposed a $9,500 as her price. This alone became a counter-offer. Diverting the minds further from the meeting, Mary set conditions of which Lianne had to accept or deny. What happened later, Lianne became unreachable. As in the case above, Lianne actions of becoming unreachable pending contemplation of terms equals Bawitko conducts as discussed above. The parties also went on to negotiate further with even Mary pulling out of the deal. A reasonable man would judge that there was no meeting of mind in these negotiations. As the rule of contract law, parties should complete all their obligations (Ashcroft and Ashcroft, 2011). Sometimes, however, it happens that they complete them but with some minor deviations. The doctrine of substantial performance exists to deal with such circumstances (Kubasek et al., 2016). When it happens that one partys work deviated complete performance, the court examines whether such fault was material to the contract, or it was just a minor error. If it was a substantial deviation that goes to the core of the contract, then the court suspends the contract and allows the innocent party to claim for damages (Miller and Cross, 2010). If the error were minor, the court would do approve the contract, but it will cut the amount that equals the remaining performance to reimburse the innocent party. The application of the doctrine of substantial performance was marked in (Hoenig v Isaacs, 1952). The defendant hired the claimant for a contract work 750 which was to be paid in two installments. Since the defendant was not satisfied with the performance, he declined to pay the second installment. The claimant sued to recover the payment. The court concluded that the claimant was entitled to full contract price excluding the cost of repairing the defects. By analyzing the case of Lianne and Mary, it is true that Mary provided as required by Lianne, only that the performance did not equal what Lianne expected. So this performance falls under the doctrine of substantial performance. With this, since the performance deviation does not go to the core of the contract, Lianne would pay Mary (9,500-X). X would be the amount that would have made the performance to equal the agreed expectations. Advertisement Regulations Advertising is one broad area incorporating various aspects of expertise. In (Hill-Smith, 2015), the field of advertising involves content creation, the media, the technology used, copyrights, and a collection of personal data among others. Because of the enlarged diversities within advertisement sector, numerous conducts attract regulatory and legal considerations (Parkinson and Parkinson, 2015). Courts or legislations help in overseeing these conducts as they advertisers interact with consumers. The fundamental rules of advertising require businesses to adhere to certain moral principles (Ullah and Hussain, 2017). Among them, the set rules expect advertisements, not to be offensive or even be in bad taste. They should be truthful, and they should not be deceptive or misguiding consumers (Cawley, Avery, and Eisenberg, 2013). The majority of the rules touch mostly on the consumer rights and privacy. In Australia for instance, all conducts within digital advertising field stay under the regulation of the self-regulated rules, the federal laws, and some state agencies. A brief look at the federal rules touches on Australian Consumer law (Competition and Consumer Act, 2010). In this statute, the law expects that businesses should only provide appropriate information in their advertisement. This one is a prohibition against deceptive or misleading actions. It also prevents the advertisers from imposing unfair business terms. Other federal rules come from the Australian Competition and Consumer Commission (ACCC). This one is an independent authority that oversees the implementation ACL. Furthermore, Australian businesses should adhere to the provisions of the (Spam Act, 2003). In brief, spam is an electronic junk mail,' unsolicited email. A customer can receive a spam either through email or as a message to a mobile phone. There is no particular description of the contents of the spam messages since they depend on various situations. They can be the promotion of a particular service or product. Spams can also be viruses, fraudulent actions or offensive materials. The Spam Act dictates that businesses or people who want to send junk emails should request for customers consent before sending the message. At the same time, they should introduce the business, and the message should have options for the customer to unsubscribe from future emails. Another fundamental legislation that businesses in Australia is the (Privacy Act, 1988). This statute requires businesses to exercise openness and transparency when dealing with customers information. The act defines personal information as written or unwritten information of an identified person be it true or false. This information can take any form without regard to written or unwritten. Examples of such information can be a persons name, address, signature telephone number, age, medical information, opinions, bank account details etc. In general, privacy acts cover openness and transparency in the management of peoples personal information (Behboudi and Hasanabad, 2014). For this part, the act requires that anyone handling peoples information to have a privacy policy. The act also advises the business to keep the customer information anonymous or use a pseudonym when collecting or displaying general information. Further, the rules stipulate how a business or another person can disclose other peoples information without compromising the quality of that information (Craig, 2013). The laws also state how businesses can secure information, but it insists on the rights of allowing the customer to access their information or correct it. Among these rules, the state also recognizes the existence of self-regulatory rules that aims to fill the gaps and supplement the statutes in places that prove hard for the law to reach. Other states have the same laws for the protection of the customers. For instance, America has an established body known as United States Federal Trade Commission (FTC) that deals with issues of advertisements (Rustad, 2013). In Grimes (2017) states that FTC works to keep a check on the cyberspace to prevent deceitful and unlawful media conducts management. The FTC is the main body that that enforces the regulations and statutes that involve online advertising. In addition, the state has other mechanism like the federal Lanham Act, and self-regulatory rules that supplement FTC. In the US, The FTC has the mandate to take public complaints. When a member of the public lodges a claim against a business, the body has the power to decide whether such practices amounted to either a deceptive or an unfair conduct (Grimes, 2017). If the determination finds that the allegations were true, the FTC can order the business to stop the unlawful conduct. Besides, the commission can choose to sue the company on behalf of the public (Grimes, 2017). FTC can also protect the consumers by ordering a company to stop a particular advertisement or a product from selling in the market. Where a product requires additional instruction for use or warning, FTC has the power to order the company to include such warnings on the product or the advertisement. One example is the rule that cigarettes should warn that smoking puts someone health in danger. Conclusion There is always need to comply with the law set for smooth operation of the business in each state. The failure to comply with the law attracts discussions with law enforcement bodies to investigate the business conducts. When these cases arise, a mandatory compliance with the required instructions and set time frame becomes a necessity. More than that, the even unimagined issue may arise during the investigation that may become hard for a business to handle at the time. Situations may also become harder which can even see the closure of the business. Reference List Ashcroft, J. and Ashcroft, J. (2011). Law for business. Mason, Ohio: South-Western Cengage Learning. Craig, B. (2013). Cyberlaw. 1st ed. Boston: Pearson. Beale, H., Bishop, W. and Furmston, M. (2008). Contract. 5th ed. Oxford: Oxford University Press. Rustad, M. (2013). Global Internet law in a nutshell. 2nd ed. West Academic. Kubasek, N., Browne, M., Dhooge, L., Herron, D. and Barkacs, L. (2016). Dynamic business law. 3rd ed. New York. NY: McGraw-Hill Education. Prescott, D. and Swartz, S. (2010). 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Doi: https://10.1017/S000819731400083X Hartslief v Terra Nova Royalty Corporation, [2013] BCCA 417 Bawitko Investments Ltd. v Kernels Popcorn Ltd. [1991] 79 DLR (4th) 97