Reference no: EM132403811

LAW110 - Business Law Assignment -

Session 1 2019 - Faculty of Business, Justice and Behavioural Sciences, School of Accounting and Finance, Charles Sturt University, Australia

Learning outcomes - Upon successful completion of this subject, students should:

• be able to describe the Australian legal system, including its history, development, and the current the-oretical frameworks within which it and its institutions operate;
• be able to compare and contrast the Australian legal system with other legal systems;
• be able to synthesise knowledge of the doctrine of precedent with knowledge of the hierarchy of the courts - at a state and federal level - to explain which court has jurisdiction in a particular matter;
• be able to investigate the different sources of Australian law in order to contrast these sources and explain their significance and interrelationships when applying them to legal problems;
• be able to independently apply rules of statutory interpretation, including Latin maxims, common law approaches and the legislative provisions that apply at a state and federal level;
• be able to demonstrate knowledge of tort, contract, and property law by identifying the relevant issue(s) arising out of novel factual situations, stating the relevant legal principles, and explaining how these relate to the legal issue(s), in addition to suggesting potential remedies when providing a conclusion;
• be able to compare different methods of dispute resolution and evaluate their effectiveness.

Assessment item - Problem Solving Questions

Task - Answer the following questions using the ILAC method of problem solving.

Question 1 -

Magnolia graduated from the Delicious Cooking College with a major in thermo-mixing. Immediately after graduating, she set up her own cooking business ('Thermo-delicious'). In early 2018 things were going really well and she was thinking about expanding her business. She met Laura Smartypants, an accountant and financial adviser. They discussed Magnolia's expansion plans and Laura agreed to prepare a business plan for Magnolia and her growing business. Laura advised Magnolia that she was in a sound position to expand and recommended that she borrowmoney to set up a cooking store in a trendy part of Bleak-heath.

Magnolia relied on Laura and acted on her advice. In July 2018, she borrowed $69000 from Usurer's Credit, a small credit union that provided a loan and overdraft facilities. Magnolia then signed a five-year lease, bought seven additional thermomixers and hired Tracey's Designs & Graphics to design a webpage for her. Then things went sour. Laura admitted that she had not adequately factored in her pre-existing debts, had underestimated the significant establishment costs associated with setting up a business in Bleak-heath. Laura explained to Magnolia that in addition to reviewing Magnolia's financial position, she also consulted her tarot cards on the matter and the reading showed that Magnolia's business would reach financial glory. Magnolia has suffered loss as a result of this advice. She is unable to pay Usurer's Credit.

Advise Magnolia on any rights and liabilities arising from these facts, citing relevant statutory and case law authority, using ILAC format.

Magnolia's boyfriend, Jake, is a successful property developer in New South Wales. He is interested in purchasing a large property for re-developing purposes in Blackheath. On 15 April  2018, Jake contacted The Blue Mountains City Council requesting several statutory certificates about various planning issues related to the property. He specifically requested information about prospective road-widening proposals relevant to the property. On 10 July, Jake received a letter from the Council, annexed to a planning certificate, indicating that there were no road-widening proposals relevant to the property. On the strength of this statement, Jake went ahead and purchased the land. Two months after finalising the purchase he was advised that a road widening proposal had been approved on 26 July 2018 and that it required the acquisition of more than one half of Jake's property. What remained was unsuitable for Jake's re-development. Jake suffered a financial loss of $1,600,000. As a result of this loss, Jake's business experienced serious financial difficulty which led to Jake developing a seriousmental disorder.

Advise the Council on any liabilities arising from these facts, citing relevant statutory and case law authority, using the ILAC format. Please focus on the liability of the council.

Question 2 -

Donald Frump owns several restaurants in New South Wales. He and his family has solicited your advice as to their contractual liabilities and rights arising out of these circumstances: On 20 September, Donaldmeets Margarita over lunch. Margarita owns a small dairy farmcalled 'The Milky Cow'' . After some negotiations, Margarita offers to sell Donald 200 kgs of Wagyu beef for $3500. She also tells him that she will keep the offer open for the next 24 hours. Two hours later, Margarita receives a call from Carlos who offers $3700 for the meat. She immediately accepts Carlos's offer. Donald calls three hours later ( within the 24 hours period) and informs Margarita that he accepts the offer, want his meat delivered and that he will sue her for breach of contract if she does not comply with their deal.

Donald agrees to buy a new truck for home deliveries. He approaches Mario's Trucks and Motors Pty Ltd and makes enquiries about a couple of vehicles. He agrees to purchase a Pantech 2018 for $60,000. After the contract is signed he asks Jeff, the sales manager, if they will provide the first service free of charge. Jeff agrees. Two months after the purchase, the car needs to be serviced and Jeff is reluctant to honour his promise.

Donald commenced negotiations to lease some commercial premises to be used for their new restaurant in Leura. Part of the negotiation concerned the ability of Donald to demolish a wall in order to remodel the interior and build an oven. Nacho, the landlord, shook Donald's hand and told him they had a deal and that he could go ahead and get started. Donald took a large bank loan to finance the re-modelling. Four weeks later, Donald received a letter from Nacho indicating that he did not intend to proceed with the lease. Donald has already spent $150 000 on the remodelling but has not received a signed lease as yet. He has also hired two International chefs to work at the new restaurant.

Donald's parents, Mr and Mrs Frump, migrated to Australia from Romania in 1963. They are dependent on their two sons, Donald and Ricardo, for advice and support. They have limited education, no business acumen and poor language skills. Their only income is their age pension. They own their home which is valued at around $750,000. Ricardo is a charming but feckless business man who is always on the verge of something great. In 2018, he needed $265,000 to pursue a dot com opportunity that would make him as rich as his brother Donald.

He is able to borrow money from The Con Bank but only after he persuades his parents to act as guarantors. He misleads his parents as to the extent and purpose of the loan. The bank is unaware of this. After investigating their financial position the bank manager meets with Mr and Mrs Frump and go over the guarantee contract. He asks whether they had any questions and when they do not, they signed the documents as required. Ricardo uses the money in an internet company. The company becomes insolvent and Ricardo loses his entire investment. When he is unable to repay the loan, ComBank looks to the parents to honour their obligations as guarantors.

Assume that you are Donald's solicitor and that he has asked you for legal advice. Advise himas to what contractual liability, if any, he and, or his family have in the above circumstances, citing relevant case law authority and using the ILAC format.

Attachment:- Business Law Assignment File.rar