Legal Questions

Legal Questions

Read the following facts. Using only principles, concepts and law discussed in BUSN1019 (including the Partnership Act 1891 (SA)), answer each question:

Re-read the “Notes on Answering Legal Questions” commencing on page 14 of the Topic
Guide and Barron pages xxii – xxiv (7th Ed). Conciseness of expression is important in
answering this assignment, so please do not exceed the word limit! Answer all questions.
Clearly number each answer to each question. All assignments must contain full
acknowledgement of sources and failure to adequately reference sources via footnotes, and
include a Bibliography at the end of the paper, amounts to plagiarism and will result in a
“Fail” grade for this part of the assessment. Use the “Business Law Style Guide”
commencing        on     page     60      of     the    Topic       Guide     or      see:
http://mulr.law.unimelb.edu.au/go/AGLC3.
If you wish to submit your assignment answer as part of a group:
(maximum of 3 students per group)
You have the OPTION of submitting your assignments on a group basis. Group work can
allow for the benefit of shared understandings and many people (but certainly not all), learn
better if they work with others. However, this is an option: if you do not wish to work in a
group, or have trouble organising a group to work with, you may simply submit your own
work for individual assessment.
If you wish to submit your assignment answer as part of a group:
1. Select your own group of 2 or 3 people (no more!).
2. All members of the group should sign their own cover sheet (including the word
count) and all cover sheets should be stapled (in family name alphabetical
order) to the front of the assignment.
3. Lodge ONE COPY ONLY of the assignment with 2 or 3 coversheets (depending
on the size of the group) attached in family name alphabetical order.
4. One mark will be allocated for the assignment and this will be the mark assigned
to each group member.
5. Group management issues are the responsibility of the members of the group and
not the teaching staff. Remember: whatever one member contributes to the
assignment, and any consequences that flow from that contribution, is the
responsibility of the group and all members must bear the consequences.
6. If you have difficulty locating others who might like to work in a group with you,
use BUSN1019’s FLO’s discussion board to nominate your interest and locate
others who might live near you or otherwise be likely candidates to work with you.

Read the following facts. Using only principles, concepts and law discussed in BUSN1019
(including the Partnership Act 1891 (SA)), answer each question:

Helen Wong is a    talented fashion designer who has recently wona    number of awards in fashion design in Australia.    She has  been dreaming of setting up her ownline.Her Former design  teacher  Mario,being impressed by the recent    achievement of his star    student,suggests that they set up a business together. Mario’s idea is that Helen should    assist him in designing    luxurious clothing for a niche market, the target  being young famous movie stars and      young top models who need exquisitely designed    clothes    for special occasions. Helen should be    mainlyresponsible    For approaching    potential clients to find out what they     need and      make      sketches      to      be      approved
by      Mario      and      to      be     produced      upon      Mario’s      approval.      Mario
suggests  that      the      as      the      scale      of      the      business    will      probably
be      small,      they      should      hire      Mario’s      friend      Peter      to
be      in      charge      of      the    accounting      and      administration      work.
The      proposed      business      will      be      run      out      of      Mario’s     property
which      is      in      a      commercial      building      .

1.
Helen      asks      you  for  advice  on     the  most  appropriate     form     of  business     structure  or the  proposed  business.      Advise  Helen     on     the     options  in  respect     of  business

structures,     the  advantages  and  disadvantages  of  each  structure  and  your recommendations.    Helen  and  Mario have  finally     decided  to  set up  their  business  as  a  general     partnership

and  would  like  to  call  their  business  “chic  couture”. Helen  and  Mario     have  decided  that Helen  will  be  responsible  for     buying     the     office     equipment  and     equipment  for     sketching

designs     while     Mario     will  be  responsible     for  sourcing     and     buying     fabrics  and     all     the necessary     accessories  for  producing  clothing     for     clients.  It  was  agreed  that
neither  ofthem     could     make     any     single     purchase  above  $3,000  without  the     other’s  consent.

2.

Advise  Helen     on     what     she     needs     to  do     to  establish     this  partnership.

The  business     is     a     success and    continues  to  flourish.  Helen     and  Mario  decide  to     go on     abusiness  trip  to  Europe  to  watch     fashion  shows     and  get  to  know  more  fashion
icons     in     he  hope of  expanding     their     clientele.  As     Peter has    to  leave  Hong     Kong  to  take     care  of  some     important  family  affairs ,    he  will  also     be away  from     office.

Helen     and     Mariotherefore     decides  to     entrust  their     neighbor Mr.  Lee  with  the  keys
of      the     office     and     ask    him      keep  watch     of  their  office  while  they     are  away.While  they  are  gone  there  is  a    fierce  typhoon     and  the  windows  in     the  office
is     broken     by     the  wind     when     the  typhoon    signal     no.  8  is     hoisted.  Mr.  Lee  sees  the     broken  window     and  tries  to     call  Helen  and  Mario  to  let  them     know
about     it.      He  is  unable  to     get  through  to  either  Helen  or     Mario     on  theirobile     phone      he     arranges  for     one  ofhis  friends,  who  is     a  local  contractor,     to
put     aoard     over  the
window
and
seal
it
to
ensure
no
more
water
can
get
into
the
office.

Unfortunately
this
work
occurred
on
a
public
holiday
so
the
builder
charged
twice
his

usual
rate.

He
gives
Mr.
Lee
an
invoice
for
$2,000.

Helen
returns
from
the
business
trip
a
few
days
before
Mario.

When
she
returns,
Mr.

Lee
gives
her
the
invoice
from
the
contractor
.

While
thankful
that
Mr.
Lee
helped
to

make
arrangement

to
protect
the
office,
she
is
shocked
at
the
large
amount
of
the

invoice
and
believes
she
should
not
have
to
pay
it.

3.

Advise
Helen
whether
the
partnership
needs
to
pay
the
amount
stated
on
the

invoice
from
the
contractor
.

While
Mario
is
still
in
Europe,
Helen
receives
a
large
order
for
dresses
from
a
generous

client
and

Helen
needs
to
purchase
a
high
performance
computer
and
the
appropriate

software
from
High
Tec
Supplies
Pty
Ltd.
to
do
sketches
for
this
client

within
a
short

period
of
time.
The
high
performance
computer
and
the
software
will
costs
more
than

$3,000.
As
the
client
has
set
Helen
a
deadline
for
making
the
sketches
and
Helen
wants

to
show
them
to
Mario
for
approval
when
he
comes
back
in
a
few
days,
Helen
proceeds

to
purchase
the
computer
and
software
for

$3,500
without
consulting
Mario.

Subsequently
the
order
from
the
generous
client
falls
through
and
Helen
and
Mario
do

not
want
to
pay
the
bill
from
High
Tec
Pty
Ltd.

4.

Advise
on
the
position
of
Helen,
Mario
and
MarMario
Art
in
relation
to
the

$2,500
bill
from
Art
Supplies
Pty
Ltd.

On
her
business
trip
to
Da
Fen,
Mario
discovered
that
high
quality
artworks
could
be

produced
by
Chinese
artists
at
significantly
less
cost
than
the
artworks
produced
by

Helen.

Mario
therefore
established
a
business
producing
reproduction
artworks
painted

by
Chinese
artists.

Mario
felt
that
Helen
did
not
have
anything
to
contribute
to
this
new

business,
and
she
did
not
want
to
hurt
Helen’s
feelings,
so
she
did
not
mention
this
new

business
venture
to
Helen.

However,
Helen
subsequently
discovers
Mario’s
involvement

in
the
new
business.

She
also
discovers
that
it
was
Mario’s
new
business
that
ultimately

won
the
contract
to
supply
the
artworks
for
the
large
new
office
building.

5.

Advise Helen what,  if  any, rights she may  have arising from the
above.Following the difficulties between Helen
and
Mario
discussed
above,
they
decide
that

they
can
no
longer
continue
in
business
together.

They
agree
to
end
the
MarMario
Art

partnership.

Mario
leaves
all
the
art
supplies
with
Helen
but
takes
all
the
office
supplies.

In
addition,
over
the
period
of
the
partnership,
the
art
studio
apartment
has
increased
in

value
due
to
a
property
boom.

Mario
argues
that
she
is
entitled
to
a
share
of
that

increased
value.

6.
Advise
Helen
on
the
distribution
of
assets
upon
the
dissolution
of
MarMario
Art.