Agency and Partnership: A Comparative Analysis

The report concludes that agency and partnership are two forms of law in which parties form contracts with each other. Agency involves a principal and an agent who follows instructions provided by the principal, while partnership is a legal term where two or more partners agree to share profits and losses. The scenario presented highlights Tina appointing Brad as her agent to conduct a contract with other parties, but Brad ignores Tina's instruction to discontinue the contract. This scenario raises questions about liability and responsibility in agency relationships. In contrast, the partnership scenario involves four members - Simon, Mary, Sara, and George - who form a partnership to purchase storage drives from other companies. However, when Simon makes purchases without the consent of the other partners, it highlights issues with decision-making and accountability within partnerships.

BUSINESS AND
CORPORATION LAW

Table of Contents
INTRODUCTION....................................................................................................................................................3
TASK 1 ....................................................................................................................................................................3
TASK 2.....................................................................................................................................................................5
CONCLUSION .......................................................................................................................................................7
REFERENCES.........................................................................................................................................................8

INTRODUCTION
Corporation stated that there are two or more parties who are comes in the contractual
relationship with each other. They have to comes in the legal contract which must be signed
by both parties and they are able to fulfil their duties. In the present report, if employer
appoint employee for any specific reason then employees have no power to make contract
with other person without prior consent of principals. According to Agency law two parties
name called agent principal comes in the contractual relationship with each other and try to
fulfil their duties as well (Hamilton and Freer, 2010). According to partnership act, 1890, all
members are willingly come s in the contractual relationship with other for share profit or
losses equally. In the given scenario, there are four parties who agree to share profits in which
all member form for one or one person perform for all.
TASK 1
According to agency law there are two parties who comes in the contractual
relationship with each other and try to fulfil their duties in timely and efficient manner. These
parties name called agent and principals. They both singed legal agreement which is in the
written form. Agent is the person who act on behalf of their principals and try to meet their
set of target. They are not able to form any type of agreement without prior consent of their
principals. On the basis of given scenario, Tina owns independent garage for the stated
purpose. For the same reason she appoint Brad in order to frame contract at time when she is
not well. She contract fever, during four months she is off work. She tells to Brad for order
Petrol while she is sick. For this period he frame contract with Caltex for receiving petrol.
While she return from illness, tells Brad that he may no longer frame contract with Caltex.
But he enjoyed the increased status and continue to order and ignore instruction which is
provided by the Tina to him (Clark Jr and Babson, 2011). According to Agency law agents
are nor able to frame contract with other party without consent of their principals. Some
liability and duties of agents are as aligned below:
Duties
 They have to follow instruction of their principles.
 Needs to fulfil condition which are mentioned under the legal agreement of
agency.

 Act on behalf of their principals.
 Able to discharge duties with appropriate care.
 He should not able to run any transaction with his own name.
 He should proper accounting record which are important to be kept or use in
future time.
 Not able to make secret profit by using reputation of their principals.
 Able to maintain property of principal.
Liabilities
 Terms of contract of legal agency can create personal liability of agency.
 If principals are cannot be sued then people are able to file case against agent.
 In case agents perform function on behalf of foreign then agents are personally
liable for any act which is done by them.
So that, in the above case study Brad is not able to continue contract with Caltex if
Tina instruct him for not able to continue same contract (Strine Jr, 2010). But according to
vicarious liability, principal is liable for the act which is done by his agent but there is
exception that the contract which is framed by his agent is comes to his knowledge first.
When Caltex deliver fuel then Tina refused to accept it because she clear that there is
no legal contract among them. On the basis of given scenario, Tina is not liable for the act
which is done by her agent without her prior consent.
On the other hand, Tina appoint Paul as salesman who have various years experience
in the second hand vehicle market. She appoint Paul for the marketing of used vehicle. Tins
has large number of vehicle for sale on display which are including Holden Commodore
Wagon, which priced is 19,000 dollar. But Paul is sale this vehicle to Fred who is the
neighbour for 25,000 dollar. In the given scenario, Fred is not done any illegal contract
because she comes in contractual relationship with Fred for sales second vehicle and the same
act is done by the him so that there is no illegal act which is done by the Fred (Horrigan,
2010). According to principal, the price of vehicle is 19,000 dollar she doesn't realise that that
could be fetch to 25,000 dollar. And the Fred done same thing on the basis of contract which
is created among them.

TASK 2
Partnership is the legal term in which to or more partners are comes in the contractual
relationship with each and agree to share profit whatever they earn in the firm. Act if
performed by all or any of them is perform on behalf of other. In order to start this type
business there must be at least two or person for the same purpose. Firm must be incorporated
for some stated purpose (Schaltegger and Burritt, 2010). Sharing profits and losses inn ratio
which they decided with mutual consent. A written document in which define various types
their rights and duties and also their profit sharing ratio has been mentioned is known as
Partnership deed. All partners having some rights which are as aligned below:
 Every member is able to participate in overall management of the firm.
 They are entitled to share profits or losses equally.
 Able to maintain entire books and accounts of the firm which are important to
be maintained by them.
 Having right to continue in the partnership.
 Every members having to retire from the firm as per mentioned under the
partnership deed or mutual consent of other partners.
 They are able to protect firm at the loss but they have to perform reasonably.
 Not able to earn secrete profit or not accept profits from third party.
According to Partnership act, 1890, in which define various types rules and responsibilities
which are framed by the act of parliament of United Kingdom. There is a contractual
relationship which is created among two or more partners. This firm created through oral or
written agreement. The registration of this firm is an optional for them. They may or may not
be register company but it is beneficial for them to be register them (Heutel, 2012). On the
basis of this act if any partner perform any action on other members behalf then all are
equally liable for the same act.
On the basis of given scenario, Simon, Sara, Mary and George, all are willingly come
in the contract and form an partnership firm (Business and Corporations Law, 2017). Every
partner have authority to enter into the transaction on behalf of their IT firm which is known
as Computer Solution. In this case study, Simon order 500TB storage drive from Sunstar
computer hardware Ltd for the price 12,000 dollar. And he also purchase second hand ute
from You Beaut Ute Ltd for costing 9,000 dollar. But rest of partners are refused to accept

both the drives. On that case, both companies has file case against firm. So that, for the same
reason all four members all liable for the act which is done by the Simon. Because according
to Partnership act, 1890 all partners act on behalf of one person or one partner can perform
for all partners. If they can do so then all members are equally liable for the act which is
perform by one person. If Sunstar computer hardware Ltd and You Beaut Ute Ltd file against
then they have to pay prices of storage drives because according to law they are responsible
for the same act. It has been stated in the partnership deed that act of one person is having
impact on the performance of entire firm (Khurana, 2010). If individual perform task for rest
of the partner so that they are equally liable for the same act. On the basis of this act some
which are applied on this case are as aligned below:
 Follow all rules and regulation which are mentioned under the partnership
deed.
 Deed must be in the written form which is signed by all the members as well.
 They are responsible to take consent of other members while taking any
effective decision regarding business (Business and Corporations Law, 3rd
edition, 2016).
 They must share profit or losses equally or as per the written in the partnership
deed.
 They have to decide their profit sharing ratio at the initial stage of partnership.
 If any file against them then all partners are equally liable for the same
process.
 Partnership deed has been properly stamped.
 Needs to follow proper procedure in order to settlement of dispute between
members.
According to this, act or an activity which is performed by the Simon on behalf of rest of the
members, for the same reason if other companies are sued to them they are equally
responsible for the act and they collectively try to resolve the problem and found effective
decision in order to resolve the conflicts (Stout, 2012).
CONCLUSION
On the basis of above report it has concluded that, agency is the form of law in which
two parties are involve and form contract with each other. Two parties name called agent and

principals. Agents is liable to follow instruction which is provided by his principal. On the
basis of given case study Tina appoint Brad for conducting contract with other parties in her
absence. But one day She tells him to discontinue the contract which he used to frame in her
absence. But Brad ignore instruction of Tina and continue their contract as well. On the other
hand, partnership is legal term which is framed by two or more partners and they are willing
agree to share profits or losses. Also they needs top framed partnership deed which is have to
stamped by all the partners and they Are try to fulfil all the rules which are mentioned it. In
the given scenario, there are four members Simon, Mary, Sara and George who comes in the
partnership contract. Simon purchased storage drives from other companies on behalf of them
and rest of the partner refused to accept. In that case rest of the partners are also liable for
case which file against them by the other companies.

REFERENCES
Books and Journals
Clark Jr, W.H. and Babson, E.K., 2011. How benefit corporations are redefining the purpose
of business corporations. Wm. Mitchell L. Rev.. 38. p.817.
Hamilton, R. and Freer, R., 2010. Hamilton and Freer's The Law of Corporations in a
Nutshell, 6th. West Academic.
Heutel, G., 2012. How should environmental policy respond to business cycles? Optimal
policy under persistent productivity shocks. Review of Economic Dynamics. 15(2).
pp.244-264.
Horrigan, B., 2010. Corporate social responsibility in the 21st century: Debates, models and
practices across government, law and business. Edward Elgar Publishing.
Khurana, R., 2010. From higher aims to hired hands: The social transformation of American
business schools and the unfulfilled promise of management as a profession.
Princeton University Press.
Schaltegger, S. and Burritt, R.L., 2010. Sustainability accounting for companies: Catchphrase
or decision support for business leaders?. Journal of World Business. 45(4). pp.375-
384.
Stout, L.A., 2012. The shareholder value myth: How putting shareholders first harms
investors, corporations, and the public. Berrett-Koehler Publishers.
Strine Jr, L.E., 2010. One Fundamental Corporate Governance Question We Face: Can
Corporations Be Managed for the Long Term Unless Their Powerful Electorates
Also Act and Think Long Term?. The Business Lawyer. pp.1-26.
Online
Business and Corporations Law, 3rd edition, 2016. [Online]. Available
through:<https://store.lexisnexis.com.au/product?product=business-and-
corporations-law-3rd-edition&meta_F_and=9780409343311>. [Accessed on 2nd
May 2017].
Business and Corporations Law, 2017. [Online]. Available
through:<https://studentvip.com.au/textbooks/isbn/9780409336887>. [Accessed on
2nd May 2017].