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HI5015S: INDIVIDUAL ASSIGNMENT (20 per cent) – 2,000 words
Assignment Question
Printing Wise Pty Ltd is an Australian company that has a reputation in the niche market of 3D printing. It specializes in the printing of medical models and exports its product overseas in addition to domestic distribution.
In March 2014, at a trade fair in Kuala Lumpur, Malaysia, the CEO of Printing Wise, Peter Jones, meets the agents of Chinese Company based in Shanghai, DHX that specializes in the production of various types of 3D Printers. Peter was impressed by a wide range of futuristic products at the trade fair.
Back in Melbourne, Peter discusses the product with his team and sent an email to the agents of DHX in Kuala Lumpur on 10 April inquiring about specifications, pricing and delivery of DHX’s Poly Jet midsized Printer (PJ300) that he saw at the trade fair offering to pay $18,000 per piece if delivery could be made within one month. He received a reply on 15 April. The agents indicated that a new more efficient upgrade will be available in two months and they will be offering the new model for $18500 per piece on FOB basis. In order to cultivate long term business relationship the agents also proposed that Printing Wise has the option of paying 2/3 of the price when the goods are shipped and the remaining after the goods arrive in Melbourne.
On 20 April, Peter replies agreeing to the proposed terms and ordered 10 DHX’s flagship Poly Jet midsized printer that weights a little over 900 pounds and can print with 18 different types of colors. It also allows printing with different materials. It can run for at least 70 hours of continuous unattended printing.
In the meantime, Printing Wise Printing had started accepting printing orders from customers in anticipation of the arrival of the printing machines.
1 On June 5, DHX informs Peter that there is an unexpected delay of one additional month due to design issues with the new product, which needed to be rectified before production begins. The delay could cost Printing Wise Printing $30,000 in profits.
The printing machines arrived in Melbourne on 20 September. A week later the machines were examined and installed for a test run. The examination and test run reveals the following:
- the machines were not as fast as the ones he saw at the trade fair in
Kuala Lumpur
- the printer needs a Windows 7 operating computer. Windows 8 and iOS systems are not compatible with the printer or the software.
- it can be used for maximum of 35 hours continuous use, half of that promised. This is because of a poor quality component.
- two of the machines were damaged while being stowed on the ship to make room for other cargo.
Printing Wise Printing is not happy with the turn of events and approaches you for advice on the legal issues arising from this transaction and remedies available to it under CISG. Exhaustively discuss the applicability of CISG, Printing Wise Printing’s rights and obligations, alternative remedies available to the company and steps to be taken to make use of rights available under CISG.
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