Demand and Supply
Assignment 1
Case Study: Contract and Sale of Goods Law
Vinyl film is used to make commercial signage such as billboards, signage on vehicles, and traffic signs. There are two types of vinyl film: cast vinyl film and calendared vinyl film.
Cast vinyl film is considered by the industry to be a premium product with excellent durability and conformability (ie ability to stretch over surfaces with corrugations or curves). It is used when the customer wants a paint-like finish that will last a long time, usually five to seven years.
Calendared vinyl film is a cheaper product, but is also less durable (usually one to five years), less conformable and thicker than cast vinyl film, and is suitable for short term signage, such as point of sale displays.
Blackboard Pty Ltd (Blackboard) is one of a small number of suppliers in Australia of vinyl film. In June 2012, Blackboard entered into a contract with PostersPLUS Pty Ltd (PostersPLUS) to supply PostersPLUS with cast vinyl film over a 12 month period.
Between November 2012 and September 2013, Blackboard supplied PostersPLUS with film to the value of the $200,000 pursuant to the contract.
PostersPLUS used the cast vinyl film to manufacture labels for bulk shipping containers by screen printing words, numbers or symbols on to the film and cutting it to size. The labels were then attached to the containers by reason of the self-adhesive character of the vinyl.
PostersPLUS sold more than 90% of the labels made during this period to SEASTORM Containers Ltd, who in turn leased the containers with the labels on them to shipping companies. Blackboard was aware of the use to which PostersPLUS intended to put the cast vinyl film at the time the supply contract was entered into.
The contract contained the following clause:
Blackboard gives no warranty that the goods are fit for any particular purpose.
In early 2014, PostersPLUS became aware of a problem with the labels. SEASTORM Containers complained that
Case Study: Contract and Sale of Goods Law
Vinyl film is used to make commercial signage such as billboards, signage on vehicles, and traffic signs. There are two types of vinyl film: cast vinyl film and calendared vinyl film.
Cast vinyl film is considered by the industry to be a premium product with excellent durability and conformability (ie ability to stretch over surfaces with corrugations or curves). It is used when the customer wants a paint-like finish that will last a long time, usually five to seven years.
Calendared vinyl film is a cheaper product, but is also less durable (usually one to five years), less conformable and thicker than cast vinyl film, and is suitable for short term signage, such as point of sale displays.
Blackboard Pty Ltd (Blackboard) is one of a small number of suppliers in Australia of vinyl film. In June 2012, Blackboard entered into a contract with PostersPLUS Pty Ltd (PostersPLUS) to supply PostersPLUS with cast vinyl film over a 12 month period.
Between November 2012 and September 2013, Blackboard supplied PostersPLUS with film to the value of the $200,000 pursuant to the contract.
PostersPLUS used the cast vinyl film to manufacture labels for bulk shipping containers by screen printing words, numbers or symbols on to the film and cutting it to size. The labels were then attached to the containers by reason of the self-adhesive character of the vinyl.
PostersPLUS sold more than 90% of the labels made during this period to SEASTORM Containers Ltd, who in turn leased the containers with the labels on them to shipping companies. Blackboard was aware of the use to which PostersPLUS intended to put the cast vinyl film at the time the supply contract was entered into.
The contract contained the following clause:
Blackboard gives no warranty that the goods are fit for any particular purpose.
In early 2014, PostersPLUS became aware of a problem with the labels. SEASTORM Containers complained that