QUESTION 1. Dilara and Aysha have inherited a winery fr

Added on - 21 Sep 2019

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QUESTION 1Dilara and Aysha have inherited a winery from their Great Grandfather Ankit, called“Ankita”. Dilara and Aysha have continued to run the winery as a going concern. Theyshare profits equally.As the years progressed, it had become apparent that Dilara and Aysha did not have enoughworking capital to keep the winery going. In addition, given Great Grandfaher Ankit wasrather old and liked “old things”, the winery became run down, and large amounts of moneyneed to be spent to restore the winery.Dilara and Aysha are approached by Polat, a well-known French winemaker, who wishes tobuy part of the Ankita Winery and work there as a chief winemaker.Dilara and Aysha are excited as both Polat’s money and expertise are desperately needed atAnkita. Dilara and Aysha visit your office and ask your legal advice as to:a)what type of business organisation are Aysha and Dilara currently operating; and[5 marks]b)whether their current business structure is the most suitable vehicle for selling part ofthe Brothersglen Winery to Polat or whether they should consider another form ofbusiness structure, and, if so, which one?[10 marks][Total Marks: 15 Marks]
QUESTION 2Leo purchased two shares in Thomas The Tank Engine Pty Ltd for $500,000 in total.Thomas The Tank Engine Pty Ltd makes and builds trains which they manufacture and sell toretail stores. Leo, now a non-executive director of Thomas The Tank Engine Pty Ltd, isunhappy with the state of affairs of the company. The following occurred:Thomas The Tank Engine Pty Ltd revenue has increased 300%Leo has received no dividends to date and Ruby and Amanda, the two executive directors ofThomas The Tank Engine Pty Ltd, have decided to pay no dividends this year. Ruby andAmanda have voted themselves a large pay rise and bonus. Ruby and Amanda have arrangedfor Thomas The Tank Engine Pty Ltd to lease two expensive cars for their exclusive use. Leoattends his first directors’ meeting and questions the dividend policy and asks that heobjection to the lease of the cars be recorded.Amanda and Ruby decide to remove Leo from the board. They hold a members’ meeting andremove Leo from the board.Advise Leo as to his rights as a shareholder/member.[TOTAL MARKS: 10 Marks]
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