BSP 1004 NATIONAL UNIVERSITY OF SINGAPORE Semester 1 (2009/2010) Examinations BSP 1004 LEGAL ENVIRONMENT OF BUSINESS December 2009

- Time Allowed 2 Hours

INSTRUCTIONS TO CANDIDATES

1.

This examination paper contains FIVE (5) questions and comprises THREE (3) printed pages inclusive of this cover page. Answer BOTH questions from Part A and TWO (2) questions from Part B. This is an OPEN-BOOK EXAMINATION.

2. 3.

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At Your Service Pte Ltd is a big company which provides various travel related services, including overseas tour packages which are designed in-house. Recently it is has come across several legal issues and is seeking your advice on the matter. They are as follows:

PART A

QUESTION 1 Tom, a customer, had booked a special in-house tour for 2 to Bali. Tom had booked the tour as he wanted to go to Bali for his honeymoon. However, subsequently Tom cancelled the booking as he broke up with his fiance. Tom had paid the sum in full as per the contract. However, the contract also provides that, if a cancellation is received 1 month before departure, 20% of the sum would be forfeited, if a cancellation is received 2 weeks before departure, 50% of the sum would be forfeited, if a cancellation is received 1 week before departure, 75% of the sum would be forfeited and if a cancellation is received at any time less than a week before departure, 100% of the sum would be forfeited. Tom cancelled the booking 3 days before departure. Tom nonetheless wants the full sum he paid returned, on the ground that he has not used any of the services. (25 marks)

QUESTION 2 Mary is a new employee who recently joined At Your Service Pte Ltd. Her immediate supervisor cum manager is Peter. Soon after she joins, Peter starts to sexually harass her. After sometime she cannot take it anymore and complains to the top management. However, they do nothing about it, as Peter is regarded highly by the top management. A few days later, it gets so bad that she just resigns on the spot even though she has signed a two year contract. She is so traumatized by the sexual harassment that she has to seek psychiatric counseling which costs a lot of money. She is thinking of suing At Your Service Pte Ltd for the medical expenses and At Your Service Pte Ltd is thinking of suing her for wrongful termination of the contract. (25 marks)

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QUESTION 3 Lena is a foreign student studying in Singapore who is keen on going on a one day tour of Singapore, operated by At Your Service Pte Ltd. Her guardian booked the tour and paid for it. The ticket states that it is not transferrable or assignable (but no one checks as to who is boarding the bus). While inside the tour bus, Lena slips and falls on some icecream and injures her back badly. Medical expenses come up to $4000. There is a clause in the contract which states that At Your Service Pte Ltd would not be liable in negligence for any bodily injury, death or loss of property. (25 marks) QUESTION 4 Since it is a big company, At Your Service Pte Ltd has outsourced its cleaning services to Y Company. Y Company sends 20 workers to clean At Your Service Pte Ltds premises on a daily basis. At Your Services Pte Ltd pays Y Company about 20% more than the market price, thinking that Y Company must be good. The contract is for a period of 2 years. However, At Your Service Pte Ltd finds the cleaning services done are not very satisfactory. The workers often arrive late. Further, they are often found idling or playing with their mobile phones instead of working. In addition, though the rubbish is cleared everyday and the place is mopped daily, everything is just done very superficially. While looking up the company details now, At Your Services Pte Ltd also realizes that Y Company has been advertising that it has a certain international certification, but that, this is not true. At Your Service Pte Ltd wants to know whether it can use this ground too, to get out of the contract. (25 marks) QUESTION 5 At Your Service Pte Ltd has just bought 150 new computers from Z Pte Ltd which is in the retail business. At Your Service Pte Ltds operations depend heavily on a highly effective computer system. On the first day, staff of At Your Service Pte Ltd, start installing the computers. Out of the 20, they manage to install on the first day, 13 have one serious problem or the other. As such At Your Service Pte Ltd wants to return all the computers immediately and get back its purchase price. There is a clause in the contract which states that goods sold cannot be returned or exchanged. There is also a guarantee card which comes with each computer and which is given by the manufacturers. The manufacturers have a repair outlet in Singapore. (25 marks)

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