Contract and Partnership in Business and Corporations Law

This presentation discusses contract law issues such as liability, enforcement, termination, and frustration, as well as partnership law issues such as existence, liability, duties, identification, and dissolution. It provides relevant rules and applications in the context of business and corporations law.

Business and
Corporations Law
CONTRACT AND PARTNERSHIP

Contract Law Issue
 Whether Gary can be held liable for the performance of the contract to
supply the apartment developer.
 Whether the apartment developer has any rights to enforce the terms
of the contract.
 Whether the contract has been terminated.
 Whether this can be treated as frustration of the contract.

Contract Law Rule
 A contract that has been validly formed creates a legally enforceable obligation of the
parties to the contract to perform their part of the terms of the contract.
 Termination or discharge in relation to a contract implies a situation under which these
obligation that have accrued because of the contract may be extinguished or ended.
 The contract law provides for six ways that can enable a termination of the obligation
and the rights of the parties that has evolve owing to a contract.
 A contract can be discharged or terminated by the performance, for a term of the
contract, express agreement, breach, operation of law and frustration.

Contract Law Rule
 A contract will become automatically discharged and all the obligations and the rights of the
parties to the same can be brought to an end if the parties make performance of their part of
the contract.
 A discharge of a contract can also be effected in case a term of the has contained any
condition for the discharge of the contract.
 Contracts are formed by virtue of agreements that has been made between the parties. If both
the parties to the contract can come to an agreement for the discharge of the same, they are
entitled to terminate the same and will be discharged from liability of performing the contract.
 A contract can also be discharged by breach of the any condition or term contained in the
contract by a party to the contract.
 There are certain statutory restrictions that may discharge a contract by rendering the same
to be in violation of the law.
 A contract can also be discharged by the operation of law under the doctrine of frustration.

Contract Law Application
 One month prior to the commencement of the work under the contract it has been
informed to Gary by his landlord that the state government has acquired the property
that Gary has been holding on lease for their new East-West Tunnel Link project owing
to which the premises needs to be vacated within six months.
 This has made Gary to have consider other place to set up his factory, which will
require him another three to six months to set up the factory. Prior to the setup of the
factory he would not be able to produce the metal frames as required under the
contract.
 This can be treated to be an event, which would not have been foreseen by the
parties. The event has also made the performance of the contract by Gary to be
impossible.
 As the manufacture of the metal frames will be impossible without the factory being
setup.

Contract Law Application
 This would require render the contract to be frustrated by the operation
of law and the same will be discharged.
 However, a new contract can be formed between Gary and the other
person if a extension of time be allowed.

Contract Law Conclusion
 Gary cannot be held liable for the performance of the contract to supply
the apartment developer.
 The apartment developer has no rights to enforce the terms of the
contract.
 The contract has been terminated.
 This can be treated as frustration of the contract.

Corporation Law Issue
 Whether Lucy, Koo and Seamus are running a partnership business.
 Whether Koo and Lucy will be liable to make contribution towards the
purchase with respect to the ride-on mower.
 Whether Lucy has breached any of her duties as a partner owing to her
weekend work that she has been continuing.
 Whether the individuals under the business name LuSeKo can be
identified by FastCut for proceeding with legal action.
 Whether the partnership will be affected in any way for the demise of
Seamus.

Corporation Law Rule
 Section 6 of this Act defines the term partnership. It mentions the partnership to be a
relationship that exists between two or more persons who are running a business common to
all of them and has the motive of earning profit.
 The powers in relation to make binding transactions for the firm by any of the partners has
been provided under section 9 of this Act.
 A partner is under an obligation to disclose genuine and appropriate information and account
that may affect the firm or any other partners under section 33 of the Act.
 Every partner are under an obligation to make disclosure of any personal benefit that he
might have accrued without the authorisation of the firm or without the knowledge of other
partners utilising the property belonging to the firm or the business of the firm or the name of
the firm under section 34.
 A restriction has been imposed upon a partner from running a business identical to the firm
for the purpose of competition under section 35 and any profit accruing from such business
needs to be shifted to the name of the firm.
 The consequence of the demise of a partner has been contained in section 38 of the Act. in
the absence of any contradictory agreement, the demise of a partner results in the
dissolution of the firm.

Corporation Law Application
 Koo, Lucy and Seamus have registered a business under the firm name of LuSeKo to run a
business.
 A contract has been instituted by Seamus with FastCut for the purchase of ride-on mower with a
view to be used in the business.
 A separate business has been run by Lucy and she has been serving the regular clients of
LuSeKo.
 In Australia, every business is regulated by the ASIC. Hence, FastCut can decipher the identity of
the individuals indulged under the cover of LuSeKo with the help of ASIC for availing legal action
against them.
 Seamus has died and there has been no contract among the partners of LuSeKo in relation to
any arrangement to be followed on the demise of any of the partners.
 In case of absence of any contract with respect to the same, the said demise will have the effect
of the dissolution of the firm. In this case, the firm will be dissolved for the death of Seamus.

Corporation Law Conclusion
 Lucy, Koo and Seamus are running a partnership business.
 Koo and Lucy will be liable to make contribution towards the purchase with respect to
the ride-on mower.
 Lucy has breached any of her duties as a partner owing to her weekend work that she
has been continuing.
 The individuals under the business name LuSeKo can be identified by FastCut for
proceeding with legal action.
 The partnership will be affected for the demise of Seamus.
 Koo and Lucy may identify the property belonging to the partnership by enquiring their
purpose for which the same has been used and whether those properties has been
used by the firm and owned under the name of the firm. These properties belonging to
the firm can be utilised to mitigate the losses incurred under the name of LuSeKo.