BUSINESS & CORPORATIONS LAW ASSIGNMENT -
The assignment consists of 2 parts: a 2,000 word report (maximum) and an 8-10 minutes (maximum) in-class or video presentation.
Report: Write a report outlining the following:
a. Case introduction.
b. The duties/responsibilities breached (ex. CA sections 181 or 588G) and explain why the duties were breached.
c. Discuss and critically ANALYSE the court/tribunal decision and the reason for the decision in view of the Corporations Act.
d. Where possible and applicable, the relevance of the decision to the development of Australian corporations law or the impact of the decision on the operation of companies in Australia.
Presentation: Present the report in class or video recording. Your lecturer will advise which is more appropriate.
a. If in-class presentation, all members must present on the day. If video presentation, groups must show to the satisfaction of the lecturer that all group members made a reasonable contribution to the group work.
b. Non-compliance with this requirement will result in a failing mark or a fail will be recorded.
Part A -
1. Allan wants to sell his travel agency to Jane. He states that the agency has a turnover of $500,000 and shows Jane evidence that the turnover was over $450,000 but not $500,000. Despite this, Jane purchases the agency on the faith of the representation made by Allan, but also because of her belief that she can do better. The contract for the sale of business makes no provision as to the earning capacity of the business, but rather states that the owner's representations are not binding unless expressly noted in the contract's special conditions. Some months after the completion of the contract, Jane discovers that the business barely turns over $250,000 and is most unprofitable.
Advise Jane of her rights, if any, at common law and under statute law.
2. Alex is a property developer and purchases a block of land that is zoned medium density. The zoning is confirmed in the planning certificate in the contract of sale. Alex's intention is to develop 10 apartments and then subdivide and sell the 10 apartments. Alex is keen to commence construction and, under the contract, has the right to start work before the purchase contract is settled. Alex fails to mention to his lawyer that work has commenced. A couple of months later when his lawyer does the usual searches, he obtains a new planning certificate that shows that the land is zoned residential and this is contrary to the planning certificate issued by the City of Williamstown only a month earlier.
Advise Alex of his rights against the vendor, the City of Williamstown and his lawyer.
Part B -
PROBLEM QUESTION - Lucy, Seamus and Koo are students who are keen to earn an income in their spare time to finance their studies. Lucy has a truck, Seamus owns a lawnmower and Koo has a computer. They print flyers advertising LuSeKo Mowing Service (LuSeKo), their registered business name, which they drop in to neighbourhood letterboxes.
Within a short time, LuSeKo has a list of regular clients. Seamus cuts the grass, Lucy removes the clippings in her truck and Koo keeps the accounts.
Seamus decides that they need an industrial ride-on mower and orders one from FastCut Mowers in the name of LuSeKo. Lucy and Koo were not consulted about this purchase.
Meanwhile, Lucy develops a separate business relationship with many of LuSeKo's clients by removing rubbish from their properties on weekends while Seamus and Koo are busy studying. These clients pay Lucy in cash, which she deposits into her personal bank account. Lucy does not disclose these jobs to Seamus and Koo.
When FastCut's bill arrives, Koo is particularly upset when she realises there is insufficient money in the LuSeKo bank account to pay for the ride-on mower.
Then, while operating the ride-on mower, Seamus hits a stump and is flung under the rotating blades. He later dies as a result of his injuries.
(a) Are Lucy, Seamus and Koo carrying on a partnership?
(b) Assuming that Lucy, Seamus and Koo are in partnership, would Lucy and Koo be liable to contribute to the purchase of the ride-on mower?
(c) Is Lucy in breach of any partnership duties as a result of carrying out her weekend work?
(d) If FastCut wishes to commence a legal action against LuSeKo to recover the purchase price of the ride-on mower, how could FastCut discover who the individuals are behind that business name?
(e) What effect will Seamus's death have on the partnership?
(f) How would Lucy and Koo determine what is partnership property? How would the partnership's property be used to meet the LuSeKo's losses?
Textbook - Business and Corporation Law, 3rd Edition by Jeffrey F Fitzpatrick, Christopher F Symes, Angelo Veljanovski and David Parker.