Business and Corporate Law Study Material

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Business and Corporate Law

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Question 1 ......................................................................................................................................3
Discuss ‘law’ and ‘justice’ one and the same thing?..................................................................3
Question 2........................................................................................................................................4
Does Pedro have a valid contract with Andres and he entitled to the boat? Explain with
reference to all the elements of a valid contract..........................................................................4
Question 3 .......................................................................................................................................5
Samuel wants to set aside the transfer of the beach house to Lee. Advise him of his legal
position........................................................................................................................................5
Question 4 .....................................................................................................................................6
a) What is the parol evidence rule, and what is the court’s reasoning in applying the rule?......6
b) List and explain the exceptions to the parol evidence rule. ...................................................7
Question 5 .......................................................................................................................................8
Pedram seeks advice for whether his contract to supply the steel frame with shopping center is
discharged by frustration.............................................................................................................8
Question 6........................................................................................................................................9
When is it appropriate to bring a statutory derivative action (s 236)? .......................................9
Draw a flowchart for the steps to be followed in an application for oppression by a minority
shareholder..................................................................................................................................9
What are other personal rights conferred on members by the Corporations Act?....................10
CONCLUSION..............................................................................................................................10
REFRENCES ................................................................................................................................11

INTRODUCTION
Business and corporate laws are the laws that has been formed for helping in
establishment of business organization according to framework formed within an country. These
laws prescribed about guidelines and rules which makes goals of organization to be achieved.
Such laws are also known as corporate laws as they deal with issues emerging in corporate
world. Both business and corporate laws cover the same aspect which is related to an business
organization willing to establish itself. Scope of the laws are wider because they cover various
aspects related to business. Nature is dynamic as they covers rules and regulation required to
makes objectives of business to be achieved.
MAIN BODY
Question 1
Discuss ‘law’ and ‘justice’ one and the same thing?
Laws are those rules and regulations that has been formed to deal with crimes existing
within society. Laws helps in forming those guidelines which makes sure that order and
discipline is maintained in an organization. Also it provides framework which gives stability to
the legal system existing in Australia. Legal system of Australia consists of various kinds of laws
that dales with all kinds of crime and wrongs that has been existing in the country. In order to
seek that implementation of law is done in right manner judiciary is formed. Judiciary holds
responsibility to make sure that laws are applied in better manner and punishment is given to the
party proven guilty(Bukspan and Yadin, 2018). Supreme court is considered to be the highest
court of apple which deals with all kinds of matters transferred from High Court. After this High
courts comes that is divided into two division criminal that deals with criminal offences like
murder, sexual assault, rape or any other criminal conspiracy. Then comes civil division which
deal with civil wrongs which are majorly committed by an individual. In this cases related to
contract law, torts law and banking laws are there. Further subordinates or lower courts are there
which takes matter at first instance and its judgement can be challenged in High courts. Then
come other courts like tribunals which are formed for special purpose mostly for Alternated
Dispute Resolution System.
Juvenile courts are there which deals with issues related to juvenile.

From the above discussion it can be observed that both judiciary and laws are interrelated
with each other as judiciary is there to safeguard laws. Also it is the responsibility of Judiciary to
interpretation them according to the situation or condition existing in a case.
Question 2
Case scenario: In this case Pedro was jogging one morning and he noticed that a sign board on
boat's wind-shield stating that for sale $9,000, Text Andres on 0409876543. Direct buyers
only!”. He called the number given over the sign broad and drooped a voice message saying that
he’s happy to buy the boat for $7,000 and left his number for callback. Anders call Pedro back
and leaves another voice message saying that he can give the boat for $8,000. On same day
another buyer sees the boat and makes $9,000 cash offer to Andres on the spot. Pedro sees that
boat is gone and then listens to voice message for first time and calls Anders right away and tells
that he has accepted his offer. Pedro now thinks that Andres has accepted the offer and contract
has been formed between them. He argued that an verbal offer has been created so Andres has no
right to sell the boat to another buyer (Dinovitzer and Garth, 2020).
Does Pedro have a valid contract with Andres and he entitled to the boat? Explain with reference
to all the elements of a valid contract
Contract laws are the laws that has been formed between two parties and is legally
enforceable by them. These laws are important form view point that it helps in building of strong
relationship between contracted parties and makes monetary transaction to be conducted in
smooth manner possible. An contract can only be valid when its elements like offer, acceptance,
consideration and legality exists within them. This can be justified with a statement that all
agreements are contract but all contracts are not agreement. An contract can be of both oral and
written form which means that an promise can be considered as a contract and a written
document can also be considered as a contract. Various elements are there that makes an contract
valid has been explained as follows:
 Offer: This is the idea that is being presented by a party for making an contract to be
conducted.
 Acceptance: It means that offer or idea that has been presented by parties to another
party is being accepted by the party.

 Consideration: Under this all guidelines and important points has to be discussed
between parties regarding the contract that has to be formed between them.
 Legality: It means that whether an contract has been formed according to the law and
illegal activity taking place within an organization.
From the above scenario it can be observed that contract has not taken place between
Pedro and Anders. As the voice message was heard after the boat has been sold ton another
party. This shows that basic element of contract is missing that is acceptance that has not been
made by party (Gehlen, 2019). So, in this case invitation to treat and counter contract exists
which are not considered to be a valid contract. Hence it has been proved that not contract
existed between party.
Question 3
Case Scenario: In this case Samuel Finely has two children a daughter Lee and a son Keaton.
He has got lovely beach house in Palm Beach. Sam has fallen ill and doctors has told that he has
less then an year to live. Lee knows that Keaton is father's favourite child has been named in
latter's will to inherit beach house. Lee knew that his father is 90-years old and has become
mentally weak. She could pressure him to transfer Palm Beach House to her. Four months of
pressure and threats Lee succeeded to convenience Samuel to sign document and transfer Palm
Beach house to her.
Samuel wants to set aside the transfer of the beach house to Lee. Advise him of his legal position
Transfer of property means an act by which an living person transfers the property to
another person. This is dealt under property law. There are various ways in which a property can
be transferred that is through mortgage, sales, lease, will and gift or license agreement. Property
law explain in detail about such transfers. In the above case the property is being transferred
through will. Under this the property is equally divided among all members of family as per the
percentage mention in the document of will. In other words will is legal declaration that makes
transfer of property possible after the death of the person. Australian property law is that kind of
legal system under which various guidelines has been mentioned in prioritising the property law
with rights, interest and responsibilities of individual in relation to the things that has to be
transferred. In this various forms of property, rights, possession or ownership of an object exists.

Law order or priorities has classified real and tangible form of property such as land or under
intangible like rights of an author or personal but tangible such as a book or a pencil.
Transfer of property cannot take place in case when the person is intoxicated, unsound
mind or any illegal means used form making property transferred by one person to another. A
property cannot be transferred by using illegal means or methods to get property transferred. So ,
for making a transfer of property possible only legal means should be used. Also an person
selling property should be aware about what is written within the document that is being used to
get the property transferred. Property of any type exists can be transferred by one individual to
another. Illegal means includes threat, fraud, pressure and force. The objective of transferring a
property is defined through the intention that is being possessed by person making transfer to
take place. Property of any kind can be transferred except an illegal property.
In the above case it can be clearly observed that Lee has threaten Samuel to make the
transfer possible of Palm Beach house. So, this becomes an unlawful objective form making
transfer to be done. Samuel holds the position of transfer according to the definition given under
the property act about it(Ghahramani, 2018).
Question 4
a) What is the parol evidence rule, and what is the court’s reasoning in applying the rule?
The parol evidence rule is that kind of rule that was developed under Anglo- American
common law. It governs over evidences under which parties to contract dispute can introduce
specific terms within an contract. Also the rule prevents parties that has reduced agreement in the
form of final written document from later introducing other evidence. These includes content of
oral discussion from earlier negotiations that has taken place in this process an evidence of
evidence with an intent according to terms of contract. Rule that has been providing about
extrinsic evidence is having variety of contract. The term parole is taken from Anglo- Norman
which has given parole to be as a word spoken from mouth. Origin of rule has been explained
under the English contract law. Adopted by jurisdiction is to be applied as per there laws related
to contract. This can be understood through example that an communication misconception has
taken place in the rule of evidence which has been taken in case England that is needed for rule
of evidence. Purpose of parol evidence is to prevent party from introducing the evidence of oral

agreement that has taken place before or while the agreement was at final stage of formation
(Heaton, 2016).
These are necessary to be presented because they help in understanding the case in much better
manner. Further these evidence rule is useful for following purpose that is as follows:
 In this helping to increase predictability existing within a commercial contract that
encourages parties to draft a contract inn clear and fair manner.
 This has been making reduction of litigation or conflicts that exists between parties over
meaning of term in final contract.
 It has been proven to be very helpful in marking out intention of parties at the time
contract is being formed.
b) List and explain the exceptions to the parol evidence rule.
The parol evidence are those rule treats parties of formal documents and are being
reflected over true intention. In other words this means that something that has been discussed
before the contract is being formed and left terms that has been intestinally included within the
documents. There are two exceptions to this rule that has been explained as follows:
The contract is an oral contract or partly written:
In this exception there are evidences of trade usage that is known as uniform and certain.
Relevant case law related to this is Appleby v Pursell in this the court held that narrow view of
admissibility under extrinsic evidence has to be taken under which evidence over surrounding
circumstances is only there to handle resolve patent ambiguity, latent and inherent ambiguity as
per the contract (Orts, 2017).
Parties may have entered into a collateral contract:
Under this establishing an estoppel with rectification, condition precedent that are based
on Australian Common Law within implied terms. Relevant case law related to this exception is
Electricity Generation Corporation v Woodside Energy Ltd in this High Court held that various
approaches on interpretation of commercial contract has to be considered and language that is
being used by parties. The surrounding circumstances is known to them and commercial purpose
with objective that has been secured under the contract when an transaction has been done. This
has been implied with the due consideration as per the surroundings over circumstances then
court is required to utilize broader approach.

Question 5
Case scenario: In this case Termi Fab is a steel fabrication that has been operating in Adelaide
and is owned by Pedram. The business has current 10 year lease of the factory that has been
manufacturing operations. Pedram has been awarded as a contract over supply steel frames that
is going to be used in building a commercial shopping centre Adelaide CBD. As per the contract
Pedram is going to start supply over frames to shopping centre developer within 90 days and
time period given for construction is 24 months. Supply is required to be made for 16 months. As
the company happens to fall in the route of new tunnel that government is forming. Just two
months before delivery date of first supply of steel frame. The South Australian Government
compulsorily acquires the site of Pedram’s factory and orders to leave site in Four months. Now
Pedram cannot deliver the first supply of steel frames to the developer in time.
Pedram seeks advice for whether his contract to supply the steel frame with shopping center is
discharged by frustration.
As it has been described under contract laws it means that an contract can be frustrated
under which changes exists after the contract has been formed within the circumstances the
contract has been formed between parties. This makes the contract impossible to be performed or
deprived of contract with commercial purpose. If an contract is found to be frustrated then each
party is being discharged from future obligation under contract and neither parties sue for breach.
An contract can be discharged through frustration and a contract may be frustrated where exists
an change within the parties that has been rendering contract wither impossible to be performed
and depriving of contract is for commercial purpose. Under this each party is discharged from
future obligation within contract and a party may sue for breach. In this allocation loss has been
explained under Frustration contract Act 1943. Relevant case law regarding this are as follows:
Taylor v Caldwell in this case claimant is being hired out at music hall in Surrey for the
purpose of holding four grand concerts. Claimant has to spend lot of money and expense over the
organizing concert. A week before the first concert was due that has to take place music hall was
destroyed due to accidental fire. For this purpose only action for breach of contract was brought
over claiming damages over expenses that has been incurred. So, the court held that claimants
action of breach of contract failed and contract become frustrated as fire meant which made
contract impossible to be performed (Prasad, 2018).

Nicholl and Knight v Ashton and Eldrige & co: In this case parties has agreed that a
cargo of cotton seed has to be shipped from Egypt to England. Under the contract has been
specified that ship. The Orlando was to carry the cargo. This ship become damaged and repair
was to be done when the contract was due to be performed. In this it was held by court that by
naming the ship and sending for delivering of cargo cannot be delivered within the time period
specified in contract.
All the cases that has been mentioned above is applicable to the scenario in a manner that
shop has been acquired by government as it was coming over the way to form the tunnel. This
means that due to uncertain circumstances only breach has accrued.
Question 6
When is it appropriate to bring a statutory derivative action (s 236)?
In this section legislation permits a member of officer that has been bringing proceedings
over behalf of company. Under this intervention of any proceedings to which an organization
helps in taking responsibility on behalf of organization within the proceedings. Such action is
brought when the contract has been breached or any kind of fraud has been committed by
members of a company (Schillig, 2016).
Draw a flowchart for the steps to be followed in an application for oppression by a minority
shareholder

What are other personal rights conferred on members by the Corporations Act?
The Corporation Act is the act that is based on dealing with business entities that exists at
both federal and interstate level. Under this there are certain rights that is being posed by
members of corporation and they are as follows:
 Right to prevent irregular forfeiture of share (Sheehy and Damayanti, 2019).
 Right to impugn as resolution of general meeting if its is not appropriate for an
organization is sufficiently informative.
 Right to have reasonable opportunity over expressing views about particular regulation in
an company.
 Right to conduct a meeting for amending and proposing resolution with meeting
 Right to transfer of shares
 Right of member to have obligation over a company increased without consent.
 Right to vote and record vote.
 Right to have constitution observed relation payment of dividends.
 Right to side aside allotment of shares that has been made for an improper purpose.
CONCLUSION
From the above discussion it can be concluded that business and corporate laws are very
important to set an business organization. Further in this file judiciary and laws has been covered
in interrelation with each other. Also basics of contract with explanation of elements is covered.
Then transfer of property has been covered with parol evidences. Then frustration of contract has
been explained with case laws. In the end rights conferred on members by the Corporations Act
is explained.

REFRENCES
Books and Journals
Acharya, S., 2020. Insolvency Issue in Corporate Law: A Reference of Nepal. Available at
SSRN.
Bukspan, E. and Yadin, E., 2018. Marrying Corporate Law and Family Businesses. Drake L.
Rev.. 66. p.549.
Dinovitzer, R. and Garth, B.G., 2020. The New Place of Corporate Law Firms in the Structuring
of Elite Legal Careers. Law & Social Inquiry. 45(2). pp.339-371.
Gehlen, B., 2019. Corporate law and corporate control in West Germany after 1945. Business
History. 61(5). pp.810-832.
Ghahramani, S., 2018. Business Ethics, Contractarianism, and (Optional?) Fiduciary Duties in
Corporate Law. Business Law Review. 39(1).
Heaton, J.B., 2016. The Long Term in Corporate Law. Bus. Law.. 72. p.353.
Orts, E.W., 2017. Corporate Law and Business Theory. Wash. & Lee L. Rev.. 74. p.1089.
Prasad M, D., 2018. Companies Act, 2013: Incorporating Stakeholder Theory Approach into the
Indian Corporate Law. Statute Law Review. 39(3). pp.292-302.
Schillig, M., 2016. Corporate law after Brexit. King's Law Journal. 27(3). pp.431-441
Sheehy, B. and Damayanti, C., 2019. Sustainability and Legislated Corporate Social
Responsibility in Indonesia. Cambridge Handbook of Corporate Law, Corporate
Governance and Sustainability (Cambridge University Press, Forthcoming).
Ubochioma, W., An Examination of the Relevance of the Codification and Application of the
American Business Judgment Rule to Nigerian Corporate Law. Journal of African Law.
pp.1-25.