In November 2018 Jack, the owner of two large transport trucks designed to carry ten cars each, made a contract with the owners of Acme Cars Australia Co Ltd to carry 40 cars a week between Adelaide and Melbourne for the next two years. The agreed contract price was $800 per car per week. At the time of signing the contract Jack’s weekly fuel cost was $6,000 and wages and other costs totalled $16,000.

By June 2019 Jack’s fuel costs had risen to $8,500 and his other costs had increased to $20,000. On July 1, 2019 Jack contacted Acme asking that the contract carrying price per car be increased from $800 to $900 per car per week. Acme declined on the grounds that the contract price was fixed in November 2018 for two years.

Jack replied to the effect that the original contract had been ended by the totally unexpected huge increases in oil prices, brought about by cyclones and floods, which had caused the increases in fuel and other costs and therefore a new contract was now required.

Using cases to support your reasons, discuss the legal arguments which both sides will raise and conclude which is the stronger what are the issue, rule, application and conclusion in the above case?

Answer rating: 100% (QA)

Answer iWith reference to the parties arguments Jack has a stronger argument and will likely succeed ... View the full answer