Assignment task:
A couple years ago, Mutt and his friend Jeff incorporated a company, Gourmet Delights Limited that imported and sold gourmet coffee which complemented the 'fancy muffins' they baked. The company was incorporated with 1000 shares. Mutt held 800 shares and the remaining 200 shares were held by Jeff. Mutt was a director of the company and was responsible for promoting and marketing the business. Jeff who was a graduate of UTECH and a qualified pastry chef was also a director and the company secretary. He was solely responsible for baking the muffins and brewing the coffee. They were the only two employees in the company and they operated from a shop they owned in the upscale North Kingston Mall. Everything was going well until one of their regular customers reported that she had been diagnosed with a serious case of food poisoning which was traced back to the muffins she bought and consumed from their business a few days earlier. The customer made it clear that she intends to take legal action. Mutt who has a heart condition, on hearing of the impending law suit, immediately packed up his belongings and told Jeff, "boss you on your own with this one, it's all your fault. I'm out of here because I'm not sticking around for anybody to sue me for something I'm not responsible for". He has not been back to the business place since. Six months later, Mutt decides that he is going to start a delivery business alone, without the involvement of any friends or family members. The business will be operated from the small flat that opens on to the car port of his home. He hopes that with the registration of his company, he will be able to access sufficient capital to expand his business to have a branch in most major parishes. He has identified a building on Half Way Tree Road that was owned by his grandfather to be used for the business. His grandfather always told him that whenever died, that building would be his. Mutt intends to sell the building to the company for $15M although the valuation report states that the building is only worth $10M. Prior to incorporation, Mutt entered into a contract with FLOW for the provision of internet and telephone services for the company. He also entered into a contract with JPS before the company is incorporated, to ensure that the company will have electricity as soon as it begins operations. Mutt paid the required deposit on each transaction and informed both providers that he was entering into the contract on behalf of Gourmet Delivery Service Ltd. and once the company was incorporated it would continue to make the payments. Since incorporating the company, the company has made one payment to FLOW on each transaction, but no payment has been made to JPS. Advise the relevant parties on all legal issues