Question

Susie was very thirsty, so when she passed a vending machine owned by Vending Machine Pty Ltd selling ‘icy cold Sprite’ she couldn’t resist. After checking the price on the machine and that she had the correct change, she inserted the coins in the machine and pressed the button. The machine accepted the payment but did not give her a drink.

Advise Susie whether a contract exists and with whom.

Answer 1

Susie entered into an implied contract with Vending Machine Pty Ltd when she inserted her coins and selected a Sprite, which the machine failed to dispense.

Step-by-step explanation:

Susie does have a contract with Vending Machine Pty Ltd through an implied contract formed when she deposited her coins and selected her beverage. This vending transaction represents an offer (made by displaying the drink and its price) and an acceptance (when Susie put her money into the machine) along with the consideration (the price of the Sprite), thus forming a contract. Since these elements are met, a contract with Vending Machine Pty Ltd is established.

In general, a contract is formed when there is an offer, acceptance, consideration, and intention to create legal relations. In this case, Susie checked the price, inserted the coins, and pressed the button, which can be seen as an acceptance of the offer. However, the machine did not dispense the drink, which may imply a breach of contract.