On 1st March Eccles received the following circular through the mail: Special offer. Nepalese jade figurines complete with polished teak wood bases. Handcrafted by skilled artisans in remote mountain villages these figurines will make ideal gifts or interesting coffee table conversation pieces. Priced at $250 each they will not last. Send your order and payment to Moriarty no later than 7th March. Eccles immediately wrote back to Moriarty in the following terms. I refer to your circular offering Nepalese jade figurines.
Please supply one only figurine as per the circular. Payment of the full price of $250 is enclosed. On 6th March he received the following reply: Unfortunately our circular contained a typographical error. The listed price should have been $350 not $250. Please contact us no later than 10th March if you would like a full refund. If we do not hear from you by that date we will assume that you wish to proceed with your order, we will ship the figurine and remit a supplementary account for the balance of $100. Eccles pondered the matter at length and on 9th March posted a reply to Moriarty saying: I have decided to go ahead with the purchase, albeit under protest at what I regard as questionable marketing practices on your part.
I enclose my cheque for the remaining $100. By 10th March, however, Eccles had changed his mind and at midday he telephoned Moriarty. The conversation ran as follows: Eccles: Moriarty, I have decided not to go ahead with the purchase of the figurine. I want you to refund the $250 I sent you earlier and the $100 I sent you yesterday. Moriarty: What $100? I haven’t received any letter. In any case I posted the figurine to you this morning and I am not going to have my time wasted by someone like you. If you don’t like it, you can lump it. Eccles immediately rang his bank and asked it to ‘stop payment’ of his cheques for both the original $250 payment and the additional $100 payment. He was told that the $250 cheque had already been presented and paid but that the bank would stop payment of the $100 cheque.
Eccles now wants to return the figurine to Moriarty and recover his $250. Moriarty has threatened to sue for the balance of $100 which he claims is owing. Advise them of their rights detailing the contractual significance of each of the steps that were involved in the transaction. [Total for Question: 20 marks]
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