Reference no: EM13139556

Task 
Please note that the word limit of 2 000 words is a total for both questions (ie, it is not 2 000 words for each question). I would however expect that students should be able to answer both questions in far less than 2 000 words. Your bibliography is not included in the word limit. 
You must use the ILAC format when answering these questions. 
Question 1 
Sue, Grabbit & Runne is a firm of solicitors. There are three partners, Anne, Mary and Jane. There is a partnership agreement which states that each partner may enter into contracts worth up to $ 50 000, but that any contract in excess of that amount requires the prior agreement of all partners. Anne and Mary are away at a law conference when Jane sees an advert in the local Law Society Journal for a set of law reports being sold by a local barrister, Tom, who is retiring. The set would cost in excess of $ 100 000 if all the back issues were bought from the publisher, so Jane thinks that the asking price of $ 60 000 is very good, and she agrees to buy them for the firm. She also decides that because she and Mary both did film studies as part of their undergraduate degrees, the firm would make money if it branched out into film-making, and so she buys a movie camera for $ 20 000 from Edgar. When Anne and Mary return from the conference they are furious to find out what Jane has done and refuse to authorise payment for the law reports and the camera from the firm's bank account. Advise Tom and Edgar as to their legal position, citing relevant law. 
Question 2 (10 marks) 
Mark worked as route manager for United Trucks Pty Ltd in Queensland from 2002-08. A term of his contract was that if he should leave the company, he could not engage in the trucking industry in Queensland for five years. In 2010 he registered a company called Sunshine Trucks Pty Ltd. Mark owns 95% of the shares. The other 5% are owned by his brother, Greg, whom he elected as sole director and CEO. All contracts for haulage of goods are signed by Greg in the name of Sunshine Trucks Pty Ltd. The company operates in north Queensland. 
Greg also signed a contract on behalf of the company, taking out a loan of $ 2 million from Grasping Bank in 2010 as start-up capital. The company did well during 2010, 2011 and the first half of 2012, but in July 2012 was not able to repay a loan instalment of $ 100 000 owing to Grasping Bank Ltd. 
Mark comes to you for advice after receiving two letters: One from United Trucks Pty Ltd requiring him to cease the operations of Sunshine Trucks Ltd in Queensland, the other from Grasping Bank Ltd threatening to sue him for $ 100 000. Advise him, citing all relevant legal authority. 

Rationale 
This assessment will allow you to demonstrate: 
• Your knowledge and understanding of corporations law relating to company contracts and members' remedies; 
• Your ability to apply legal rules to more complex hypothetical practical situations; 
• Your ability to conduct research using provided materials as well as other resources; 
• Your ability to structure your answer and use a clear writing style by identifying issues, stating the law, applying the law and reaching a conclusion; and 
• Your ability to apply academic standards of presentation and referencing 
• Your ability to undertake an assessment task with relevance to the workplace.