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Need some help on this case study (Calling All Law Majors)

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AAK

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I'm an Engineering Major and one of the required electives is a law course. I have this assignment that's due at the end of the course and it is 10% of my final mark.

Anyways, I'm not asking you guys to answer the question, but could you guys at least refer me to some resources for me to look at that could lead to me to some answers.

Anyways here is the case:

There are 2 people C and E. C is selling a car for $10,000 and E checks the car out on day 0. E likes the car and wants to buy it. E gives C a deposit of $500 and signs all of the allotted paperwork but he had to leave the city right after and he would be back anytime within the next 5 days. E says that he will give the remaining $9,500 by a cheque when he gets the car and at that time C will co sign the paperwork passing ownership to E.

Nothing was finalized since all of the Ministry Offices were closed that night.

However, the car's safety certificate is expired and must be renewed before E can register the car at the Ministry of Transportation. So, for E's convenience, C takes the car to renew the safety certificate. BUT, during the ride, the engine malfunctions and the engine light turns on. The car is not exhibiting any problems or any signs that anything is wrong – the light is just ‘on’. C has not done anything that may have caused the engine light to come on – this has simply ‘happened’.

Obviously something is wrong with the car. A sum of money will have to be spent to diagnose the problem. Perhaps the engine light itself is just malfunctioning. Perhaps there is a significant problem with the engine. No one knows at this point.

The question is:

From a contract-law perspective, who is responsible for the diagnostic charge ($) and any repairs that must be done? Is C required to deliver the car with no engine-light on (in other words, in the same condition as E saw it on the evening of day 0)? Or, is E responsible for any $ that has to be spent following the ‘handshake, documenting and signing the deal’?

I have this book with me:
http://ecx.images-amazon.com/images/I/41wEQtcvEDL._SS500_.jpg

And I couldn't find anything in that book which can help me with the assignment. So could any of you guys give me some resources that I can read up that could give me some information about Contract Law that would guide me onto who's side I should be on.

Thanks in advance.
 
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