PDCV101: Foundation Legal Knowledge- Property Convencying- Case Study Assignment Help

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Added on: 0000-00-00 00:00:00Order Code: Question Task Id: 0

Internal Code: TV316
Case Study Assignment:

Task:

Instructions:
Answer the following problem question.  Remember to clearly identify the relevant legal issues and support your answer by reference to the relevant legal principles and authority. Your answer should be presented in essay format and should present a clear and coherent argument.

Word limit: not to exceed 1500 words. Marks will be deducted for excess length.

Scenario:
Arya, a skilled seamstress and dressmaker, decides to start a business with her friend Rory.  When Arya talks to Rory, she says that she will run the day to day of the business, and Rory would only need to be at the shop if Arya was on holiday. Rory agrees to provide the money to start up the business, including the initial costs of fitting out the shop, entering into the lease and buying stock. Arya agrees to keep Rory informed about the decisions she will make in the business and progress. They agree that Rory will be paid back half of his initial investment, then both Rory and Arya will share in the profits. They establish a small business called “Needles and Pins” and Arya makes dresses, alterations and repairs to clothing. Through hard work, the business grows and Arya starts selling clothes of her own designs.  Arya and Rory employ more staff to help out.  Arya and Rory continue to meet regularly to go over the books, talk about staffing and discuss expansion of the business. Rory comes in to manage the shop every month for a few days at a time.

One new staff member, Joy, is very assertive and assumes a lot of responsibility. Arya notices that Joy has added the title “Customer relations manager” to her emails and other correspondence with suppliers but Arya doesn’t say anything to Joy about it because she actually finds it amusing and doesn’t want to discourage Joy. Joy knows that when a business sells gift cards, then customers will come in and generally spend more than the gift card is worth. She orders 500 pre-printed gift cards for $10 and arranges for them to be distributed in the area.

John is one of Arya’s suppliers. One day, when Arya is away, John calls the shop and speaks with Joy.  John convinces Joy to agree to John supplying goods to the business ‘exclusively’ for the next four years at a set price of $30,000 per year, which must be paid in two instalments in the first year. John tells Joy that this is the best way of securing a good deal for Needles and Pins. Joy confirms in an email to John that “Yes, this is a good deal. We would be happy to go ahead.” Joy thinks Arya should be impressed that she has saved the business money over four years and secured a good supplier.

Unfortunately, the printer made a mistake in printing the gift cards and they are printed for $100 each.  Customers start coming to the shop to present the gift cards. John makes the first delivery of goods and Joy gives the first instalment invoice for $60,000 to Arya. Arya is very unhappy with the decisions that Joy has made and tells Joy that she did not have any authority to make these decisions.

Questions:
1. Advise Arya about the basis of her legal relationship with Rory and with Joy
2. Is Arya bound by Joy’s actions and if so, in what capacity?
3. Who is responsible for the purchases from John?
4. Does Rory have any liability for the debt to John or to honour the gift cards?
5. Is Joy liable for the debt to John or for the gift cards? If so, to whom?

Uploaded By : jack
Posted on : February 13th, 2018
Downloads : 3

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