LAW Using the IRAC method Milena runs a café. The business has been very success
ID: 416043 • Letter: L
Question
LAW
Using the IRAC method
Milena runs a café. The business has been very successful and regularly makes a profit of $2,000 per week. Unfortunately, on 5th May the water pipes burst. Milena calls Plumbers’R’Us and said, “I have to close the café until the pipes are fixed so it needs to be fixed urgently. I am losing $2,000 per week.” Plumbers’R’Us said, “We can come straight away and it will be fixed within 2 days.” They enter a contract to fix the pipes for $500. Unfortunately the plumber installed the wrong pipe and this caused delays. The pipe was not fixed until 26th May. Milena says “I have lost 3 weeks profit and I have also lost a very profitable catering job for $10,000. You have to pay me $16,000 compensation for breaching our contract.” Advise Plumbers’R’Us about whether they have to pay compensation for Milena’s: • loss of profits • loss of $10,000 catering profit. Use relevant cases to support your answer.
Explanation / Answer
ISSUE: Milena called a plumber for the café as there was a leakage of pipe in the café. But, the plumber has installed a defective pipe which leads to a major loss for Milena.
ANALYSIS: Milena has the café shop. One day it has been noticed by Milena that there is a pipe leakage in the shop. Milena called the plumber as Milena business has stopped and every week Milena was losing $2,000. The plumber was called; the plumber charged $500 for installing the pipe. Later, it was seen that the plumber has installed a defective pipe which really has made a problematic situation to Milena.
CONCLUSION:
The plumber has done the wrong thing; it was Plumbers responsibility to check before installing the pipe. As the breach has been done this has created a huge loss for Milena’s shop and the profit was lost. The plumber must pay the entire compensation for the losses that have been done for plumber irresponsibility and many days were lost by Milena as the café was closed.
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