Advise greenspace whether they are contractually liable

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Reference no: EM133534665

Question

Aiden, Emma, Liam, and Olivia are the directors of GreenScape Pty Ltd (GreenScape) and aspire to develop a cozy wellness centre on a piece of property owned by the company in Penrith. This project marks GreenScape's debut as the holistic wellness service provider. Aiden, an energetic driving force within the company, is enthusiastic about commencing the project at the earliest opportunity. Without formally obtaining the board's consent, Aiden reaches out to a long-standing friend, Sarah, a retired interior designer, and seeks her recommendations for a suitable architectural firm. Sarah suggests Tranquil Designs Pty Ltd (Tranquil Designs), a company in Parramatta that she had interacted with at a later stage of her career before she retired. Aiden enlists Tranquil Designs to conceptualize plans for the wellness centre and to maintain an ongoing dialogue with him about potential challenges.

Several weeks down the line, Tranquil Designs completes their design proposal for the wellness centre and sends it to Aiden, accompanied by an invoice for the work conducted up to that point. During the subsequent GreenScape board meeting, Aiden presents the design proposal and invoice. To his surprise, the other three directors express their frustration as Aiden bypassed their involvement and failed to secure board approval for the engagement of the architectural firm. This is not the first instance of Aiden acting independently without their authorization, and their patience is wearing thin. None of the trio endorses the design brought forward by Tranquil Designs, finding it substantially at odds with their envisioned ambiance. They refuse to endorse GreenScape's settlement of the invoice.

Advise (Issue, Law, Application and Conclusion) GreenSpace whether they are contractually liable to pay the bill for the work done by Tranquil Designs, referring to relevant statutory provisions under the Corporations Act 2001 (Cth), and case law.

Reference no: EM133534665

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