Commercial Law vs Corporate Law

Running head: BUSINESS AND CORPORATE LAW
BUSINESS AND CORPORATE LAW
Name of the Student
Name of the University
Author Note

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Part A
Issue
The issue to be discussed in the present scenario is whether the museum can claim any
kind of civil action against the man in order to recover the money paid by him.
Rule
If any individual makes any kind of fraudulent misrepresentation, misleads someone, or
engages in any kind of fraudulent activity then the individual is said to have committed fraud.
Under the Fraud Act 2006, it has been established that any act, which would be untrue or
misleading, would be done in order to gain some kind of advantage or to cause harm or injury to
another individual would be considered as fraud.
Under section, 192E of the Crimes Act 1900 any individual through any deception or
dishonesty acquires any property, which is belonging to others or tries to gain some kind of a
financial advantage or cause any kind of financial disadvantage, would be guilty of committing
the offence of fraud. A person or an individual would be considered to be convicted of the
offence if such offence includes all or any part of some kind of general deficiency relating to
money or any other property which would be considered to be deficient and such would be made
up of any number relating to particular sums of money or any other items relating to any other
property which were considered to be acquired or obtained through out a period of time or a
specific duration of time. The conviction of such offence is considered to be an alternative or a
substitute verdict to a charge for any kind of offence involving larceny and for such conviction of
the offence is considered to be an alternative or substitute verdict for the offence of fraud. The
maximum penalty for fraudulent activities would be considered to be imprisonment for ten years.

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In contractual agreements, misrepresentation is considered to be the false information
which is given to a party before any kind of contract being formed or created which encourages
the parties to form a contract. If any individual enters into any kind of contract dependent on any
misrepresentation and suffers any kind of loss due to such then the party who suffered the loss
has the authority to claim for damages under the contract. It can be understood from the case of
Bisset v. Wilkinson [1927] AC 177. Misrepresentation is considered to be innocent, when any
party unknowingly or unintentionally provides with false information if the party believes that
the information is considered to be true and the party has no intention to deceive or betray the
other party to the contract. It can be understood from the case of Esso Petroleum v. Mardon
[1976] QB 801. If there has been any kind of misrepresentation of facts done with the intention
of deceiving or betraying the other party then such would constitute as an offence. It can be
understood from the case of Google Inc v ACCC High Court of Australia [2013] HCA 1. This
particular case was considered to deal with the fact that whether Google had been involved with
misleading or any deceptive conduct.
Extradition is considered to be a formal surrender by one of the states on the request of
the other state for an individual who is considered to be accused of some crime which has been
committed within the jurisdiction of the requesting state. The international treaties are not
considered to have a direct effect until and unless the Australian law recognizes it under that of
the Extradition Act 1988.
Application
In this particular scenario, Lance Lincoln is considered to be the curator of the museum
named Australian Museum of Antiquities. Trevor Hunt had been known to Lance as a treasure
hunter who had been specializing in finding various kinds of antiquities for the museums. Hunt

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had shown Lincoln collections of coins along with pieces of crockery which he had stated came
from the Portuguese wreck Gaivota which had been located in the international waters off the
northern wester Australian coast. The coins along with the crockery were considered to be
thoroughly evaluated and examined and after such they had paid Hunt with 200,000 dollars to
fund an expedition which would help in building a special Gaivota display in a wing of the
museum. The main went missing subsequently and after conducting a search, it was assumed that
it had died with the other members who were a part of the expedition. After a while it was
understood that the coins along with the crockery were considered to be clever fakes and the
actual ones had been found in the records of Portugal. Apart from such the Trevor Hunt was
considered to be a conman and the real Trevor Hunt had been identified. Therefore, he had been
arrested in England and was considered to be extradited to Australia. According to the above
rule, which has been mentioned, that in contractual agreements misrepresentation or deception
are considered to be an offence and if such has been committed then the whole contractual
agreement would end or be terminated. Trevor Hunt in this particular scenario had committed the
offence of fraud or misrepresentation under the contractual terms which means that he
knowingly sold the coins along with the crockery to the curator of the museum even though such
were fakes and not the originals. This was done to gain some personal monetary advantage and
therefore, this act of deception or misrepresentation can be understood as a fraudulent activity.
Therefore, he is liable to pay for damages for such an offence or an act. As it can be understood
from the case of Bisset v. Wilkinson. On the other hand, Trevor Hunt is considered to be
extradited to Australia as it has been mentioned in the above rule that the international treaties
would not have any kind of direct effect if such has not been recognized or ratified by the
Australian law. Therefore, if it has been then he would be extradited to Australia under the

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charges for fraudulent activities. Thus, it can be said that the museum has the authority to claim
for civil actions as Trevor Hunt had acted fraudulently and had misrepresented information and
other things knowingly with the intention to be deceptive under both common law as well as
statutory law.
Conclusion
Therefore, the museum has the authority to claim for civil actions on Trevor Hunt for
misleading and misrepresenting information under both common law as well as statutory law.

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References
Bisset v. Wilkinson [1927] AC 177. https://webstroke.co.uk/law/cases/bisset-v-wilkinson-1927.
Crimes Act 1900. https://www.legislation.nsw.gov.au/#/view/act/1900/40.
Esso Petroleum v. Mardon [1976] QB 801.
https://www.casemine.com/judgement/uk/5a8ff8cc60d03e7f57ecd934
Extradition Act 1988. http://www.oecd.org/site/adboecdanti-corruptioninitiative/39355247.pdf
Fraud Act 2006. http://www.legislation.gov.uk/ukpga/2006/35/contents.
Google Inc v ACCC High Court of Australia [2013] HCA 1.
http://eresources.hcourt.gov.au/showCase/2013/HCA/1.

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Part B
Issue
The issue to be discussed in this particular scenario would be:
 Whether the company would be liable for the contracts that had been contracted on behalf
of Kelly for the company which was to be formed.
 Whether Kelly would have the authority to enter into contracts on behalf of the company
after the registration of such company.
Rule
A corporation is considered to be a separate legal entity or a distinct legal entity which
has been formed by a legislation or through a carter prescription. The Australian law is
considered to be similar to that of the UK law and it recognizes a specific kind of corporation
which would be known as the corporation sole. Nevertheless, there have been few cases, which
involves corporation sole, and such is considered to be excluded from that of the statutory
definition of the corporation. The companies in Australia are considered to be incorporated on
the basis of registration with the ASIC. There needs to be an application for the registration
which would provide whether the company would be considered to be a proprietary company or
a public company and it would also depend on the type of liability of that of the shareholders of
the company would consist of and the most popular type of company in Australia is considered
to be the company which are limited by shares.
Under the Corporations Act, the contracts can be entered into before the registration of a
company. It has been dealt in section 131 of the Corporations Act. Section 131(1) states that if

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any individual or a person enters into a contract before any kind of registration in order to benefit
the company. The company is considered to be bound by the contract and in addition to such
would also be entitled to the benefits of the company if the company has ratified the contract.
Such needs to be possible within the time or the duration, which has been agreed upon by the
several parties to the contract. It can be understood from the case of Kelner v Baxter (1866) LR 2
CP 174. If there has been no time or duration agreed upon or specified then it needs to be done
within the time, which might be reasonable after the contract or the agreement has been entered
into. Under section 131(2), the person or the individual is considered to pay for the damages to
each of the parties who are there for the pre-registration of the contract even if the company is
not considered to be registered and did not ratify the contract. It can be understood from the case
of Commonwealth Bank of Australia v Australian Solar information Pty. Ltd. (1987) 5 ACLC
124.
Application
In this particular scenario, it can be understood that Kellie has gathered a few friends so
that they can start up a new business, which would import goods from various parts of the world.
Kellie’s friends agreed and promised to pay 10,000 dollars individually with a proposed capital
for 40,000 dollars, which would be in order to establish the new company. Kellie had
commanded and instructed the local solicitor to establish and provide with the necessary
documents, which would be helpful. She had an order, which had to be delivered to her home
address. In addition to such, Kellie had also contracted a local designer to form or create a logo
for the company. After a while, none of the friends were considered to have contributed any
money for the company due to certain problems faced by those individuals except Kellie. The
solicitor had informed Kellie that the company was considered to be ready for the registration

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and provides a bill for the work. The baskets were also considered to arrive and the local
designer needed to be paid. The company had not been registered yet and the registration of the
company was considered to be doubtful in the future. According to the above-mentioned rule, it
can be understood that any individual has the authority to enter into a contract on behalf of a
company before its registration and ratify such contract within a prescribed period, which has
been agreed upon by the parties to such contract. It has also been understood that the company
would be bound by the contract and need to perform the conditions, which have been specified in
the contract. Therefore, in this scenario, even if the company had not been registered the
company was bound by the contract, which had been entered into even if such contract had not
been ratified. The above rule also states that an individual or a person is bound to pay for the
damages even if there has been no ratification of the contract. As it has been discussed in the
case of Commonwealth Bank of Australia v Australian Solar information Pty. Ltd. Therefore,
from the above scenario, it can be understood that a contract can be entered into without any
registration. If any contract has been entered into on behalf of the company then for any non-
performance the company would be bound by such contract and the individual needs to pay for
the damages even without any kind of ratification. Kellie in this scenario was liable to pay for the
claims on behalf of the company before the registration had been formed. The company would
be able to enter into contracts even after being registered. Therefore, in this particular scenario,
Kellie would be liable for the several amounts along with the company. Secondly, if Kellie
registers the company she would still be liable for the contracts entered into on behalf of the
company.
Conclusion
Therefore, it can be understood from the scenario that

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 Kellie would be liable to pay for the damages for the contracts, which are entered on
behalf of the company.
 Kellie would be liable for contracts entered into on behalf of the company and along with
such even after registration.

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References
Commonwealth Bank of Australia v Australian Solar information Pty. Ltd. (1987) 5 ACLC 124.
https://www.thinkswap.com/au/canberra/7024-corporations-law/corporations-law-notes.
Corporations Act 2001 (Cth). https://www.legislation.gov.au/Details/C2017C00328.
Kelner v Baxter (1866) LR 2 CP 174. https://lawcasesummaries.com/knowledge-base/kelner-v-
baxter-1866-lr-2-cp-174/.