C2031575_Business Law 1 Coursework
Word Count: 2000
C2031575_Business Law 1 Coursework
Section A: Email
Subject: Jana Navratilova – La Huerta General Partnership
Date: [4 January 2022]
The contract of Notox binds with La Huerta. To be legal and more proficiency, the contract is valid because it contains two elements (‘Notox and La Huerta’). The parties had mutual agreement in which La Huerta was ordering organic wine in most cases. The contract binds because from the scenario it appears that all parties had agreed about the offer made from each side. Notox had agreed and accepted an offer made by La Huerta in that La Huerta is able to order organic whine without necessarily paying on the spot. Something of value (‘organic whine and cash’) were exchanged to make the contract running. From the case, La Huerta pledged organic whine to be paid later. Also, Pili ordered the wine because the contact binds each party.
Notox has the capacity to sue both of them. It is an agreement which is legally enforceable and if La Huerta will not abide by it, Notox has the capacity of suing them. La Huerta must fulfil their end of bargain so that Notox woud not sue them. There is a clear indication that the two parties (‘Notox and La Huerta’) were entitle to agreement knowingly. Member of La Huerta (Jana, Pili, and Carmen) could order organic wine minus any compromises because Notox knew the payment will come later. Parties are entitled responsible actions which were described in the contracts which binds the two parties. Depending on the nature of the case, the contract was either verbal or written. There are certain reference state law from the letter written by Notox. Schmitthoff vs Clive contends that there have been social problems in business1. These problems should be solved as a whole. The letter directs Notox to sue La Huerta because the contract seems to have reference state laws. The contact binds because it seems to have obligations and conditions in which one party (‘Nortox’) can take legal actions against (‘La Huerta’). Also, the contact seems to have performance in which each party should uphold their ends of the contract.
Although there was no formal agreement between you (Jana) and the two (Pili and Carmen) but the binding agreement of Notox and La Huerta must be respected. The contract include the three and each member has to give his and her share to pay for the debts. The illustration is enhanced in Sazonova and others, Synergy of Business2. Despite you (Jana) giving your shares to La Huerta (Pili and Carmen) there no documentation hence there is the need to raise 1,000 euros to be paid to Notox. Payment terms are clearly stipulated in the binding agreement hence there is the need for Notox to recover a total of 1,000 euros from Jana to settle the debts. Payment terms described in the contact include the three (Jana, Pili, and Carmen) despite you leaving La Huerta. The contract entail legal consequences which calls upon La Huerta to pay the debt. Each member must contribute an equal share of 1,000 euros to settle the existing debt of Notox. La Huerta must recognize and must keep in mind that it is required by the law to follow the terms of agreement. Failure to follow the terms of the agreement, legal actions must be enforced.
Competition in the market is something that exist on its nature. Carmen and Pili have no capacity and they are not entitled to claim compensation and profit from you (Jana). On the basis of the business given that it is a free world and a free business, there is no room for the two to claim profit and compensation. It is the nature of any business to face competition. It is something that exist itself in the free market pride and it is experienced in different circumstances. Given that you (Jana) are entitle to your own business there is no connectivity and obligation between you and the two (Carmen and Pili). Carmen and Pili could only entitled to profit and compensation if you were working with them and you decide to open business of same nature nearby. Since it is your own entity there is no use for Carmen and Pili to claim for profit and compensation. Profit and compensation could only be suitable if and only if you (Jana) had physically interfered with their business. According to the Mazumdar vs Shreya (2018) 10 AC 12, 2. There is no contractual duties binding Jana and the two people. On the merit of faith, Jana can only owe fiduciary responsibility if working together and remedies that flow from breach of such responsibilities. Since this is not the case, such obligations cannot work.
Section B: Report
Fee earner: Timor Connors
Client: TrucVerts Ltd
Matter: Rex Garrison
File No: TC/TVL/002
Date: [04 January, 2022]
Jana is the one liable to the Supplier. Rex could only be liable if exclusion clause was included in the contract. Jana refused to pay for liability insurance. Rex is not liable to the supplier. Lability in this case is something that a company (TVL) which is headed by Jana has full responsibility to pay the supplier. The office held by Jana has the mandate and the responsibility and to act accordingly in order to pay the supplier. Other members are only eligible to liability if insurance liability is included in their contracts. Jana is legally and obligated responsible in this case given that the wine that was bought could affect the reputation of the company. Generally, any member of the company can be liable to any loss or damage. There is a binding force and agreement between the company and the suppliers. The illustration is enhanced in Triana, containing misuse in conducting perspective legal business3. Jana should be liable since she had not provided insurance liability to Rex. Quality actions and responsibilities must be taken by the company headed by Jana to avoid any damage to the discerning customers. Under law and regulation it is required of Jana to take full responsibility of the action. Also, senior management and owners are liable to supplier. They are the one that makes laws within the firm.
Voluntarily association must be formed to avoid affecting the reputation of the company. Incorporation is a necessary tool that distinguishes a company from partnership. Senior membership must take crucial actions to settle the debts if insurance liability is not offered to the members. A company should have entity different to its members. This implies that a company should be liable if it did not offer insurance liability to the members. And if it offered insurance liability each member is held liable for the actions. Lability is invariably limited to certain members of the company. Rex is liable to the company (TVL) for gross misconduct. He is answerable to Jana for buying wine without tasting. The whine that was bought could have affected the reputation of the company.
Despite of his arguments of being in a hurry while ordering the whine it does not validate his actions and he is answerable to the Jana and senior management. Rex should take full responsibilities of his actions. The situation is supported with Wallinga, liability to compensate for investment losses for breach of conduct of business rules4. Despite his refutable actions, he should have been given any legal measures to correct his wrongs. To prevent further happening quality measures could have been implemented against him.
Section C: Memo
To: Supervising solicitor, Timor
From: New trainee in the Corporate Department of the firm
Subject: Addressing resolutions
Date: January 4, 2022
I am writing to inform of the resolutions that were made during the meeting. The first resolution was that Nova Read should be given a loan of 30,000 euros. It was agreed that Nova should be given the loan to enable her buy a flat in London. The resolution has an error in that it does to provide vivid explanation of loan to value ratio. It appears that the error was made during the meeting. In every state, there is usury law which measures the degree of dependency. The resolution should have followed the California law which measures loan to value ratio in regard to the intended purpose. Despite the error made it is so clear that the resolution is so effective. It will enable Nova Read to grow overall. It will help her be able to settle quickly because she had sold her London flat due to COVID-19 lockdown. According to the Harding and others, (2019) 10 AC 253. The resolution made is valid to help Nova Read adapt to the changing circumstances easily. It is of a great deed to honour it and adhere to it to make the company work effectively.
The other resolution made in the meeting was to remove Rex Garrison as a director of the Company with immediate effect. Rex Garrison was purchasing director and his work has been deemed to be ineffective. He makes decisions without acknowledging the power and efficiency of the product. The board has decided to do away with him. According to employment equity act, it is required of the company to comply with the shareholders agreement. This part was omitted hence the resolution can be deemed ineffective. It is in support with Nietsch, corporate illegal conduct and directors’ liability: An approach to personal accountability for violations of corporate legal compliance5. Despite Rex not being effective in his work but proper procedure was not followed for him to be removed. Rex was very correct on the point he made. Jana and Nova did see the need to multiply the votes of Rex. This was an invalid argument that Jana and Nova made. They could have multiplied the votes to help the situation.
The next resolution made by the board was to convene the general meeting. The general meeting was arranged minus listening to what Rex was saying. It could have been wise to listen before proceeding to the next step. According to basic condition act, each shareholder views must be adhered to before further steps. The implementation to convene the general meeting could have been done after cross-examining the case of Rex. It is of a great idea to always consider the argument of any person before proceeding to further steps.
The next resolution that was implemented during general meeting was to change the articles of the company. It is a special resolution that aimed to increase the efficiency of the company. The scenario is supported by Frost and others, changing structure of the company for financial intermediation 6. The resolution had several errors in that it limited directors not to enter the contracts which exceeds 5, 000 euros. According to the Labour relation Act, one can enter into a contract upon measuring value against ratio. No one should be limited in any case. Another error is that every director should vote given that the resolution does not violate the interest of the company.
In contrary it is advisable to bring an argument if any director feels that the resolution will not meet long term goal of the company. The status of the article is that a director is not eligible to a contract exceeding 5,000 euros. The director is only eligible to enter into the contract exceeding 5.000 euros with the consent of board of directors. A director is supposed to be part of voting only if the resolution is within the interest of the company. The company is in the position of issuing any share for a price which is less than the aggregate of its normal. Another status of the article is that every member has equal rights of voting. The last status of the article is that a director should have a total of five poll votes for every share held for him or her to be removed from being a director.
The last resolution made was to instruct Nova Read to attend to the internal administration and external administration. Nova Read is supposed to operate as immediate conduct in giving the direction of the company. The resolution has no error or omission. It is effectively stimulated to help Nova Read reach the ultimate goal of the Company. She will be subjected to dealing with any arising problem and regulation within the firm. She will in most cases represent the Company in other activities outside the firm. The effectiveness of the resolution is to ensure that long term objectives of the firm are safeguarded. She will ensure internal controls to protect assets and minimize risks.
1Schmitthoff, Clive M. “International business law: a new law merchant.” In Current Law and Social Problems, II, pp. 129-153. University of Toronto Press, 2020.
2Sazonova, I.V., Mazhaeva, V.S., Potkin, A.A. and Kuznetsova, M.A., 2021. Synergy of Business, Law and Economy in the Smart-Contract Implementation. In SHS Web of Conferences (Vol. 110, p. 01015). EDP Sciences.
Mazumdar, Shreya. “Discharge of Contract by performance and Contingent Contract.” Journal of Corporate Governance and International Business Law 1, no. 1 (2018): 9-17.
3Triana, Y., 2018, July. Impact of Contract Constructions Containing Misuse In Conducting Perspective Legal Business of Pekanbaru City. In IOP Conference Series: Earth and Environmental Science (Vol. 175, No. 1, p. 012062). IOP Publishing.
4Wallinga, M., 2019. Why MiFID & MiFID II do (not) matter to private law: liability to compensate for investment losses for breach of conduct of business rules. European Review of Private Law, 27(3).
Harding, E.L., Vanto, J.J., Clark, R., Hannah Ji, L. and Ainsworth, S.C., 2019. Understanding the scope and impact of the California Consumer Privacy Act of 2018. Journal of Data Protection & Privacy, 2(3), pp.234-253.
5Nietsch, M., 2018. Corporate illegal conduct and directors’ liability: An approach to personal accountability for violations of corporate legal compliance. Journal of Corporate Law Studies, 18(1), pp.151-184.
6Frost, J., Gambacorta, L., Huang, Y., Shin, H.S. and Zbinden, P., 2019. BigTech and the changing structure of financial intermediation. Economic Policy, 34(100), pp.761-799.