La Trobe University
School of Law

LST 2 LBA: Law of Business Association
2011

Assignment

Instructions:

1. This assignment is due in by 4pm on Friday 23 September. Submit your work by pushing a hard copy through the slot in the labelled essay submission box outside the Faculty Student Services Office on Level 2 of the Donald Whitehead Building.

2. Do not hand in or mail your essay to your tutor or lecturer.

3. You may mail your work to David Wishart, School of Law, La Trobe University, Bundoora, 3086, provided it is received on or before the due date and time. This means that your essay may be a casualty of the vagaries of the postal system, and may arrive late or not at all. If so, you will receive a reduced mark, or no mark at all.

4. In addition to the hard copy submitted via the essay submission box, submit a digital version through the assignment submission tool in the LBA LMS system. The hard copy will be the original and will be marked. The digital version will be referred to in order to verify submission times and in the case of the hard copy going astray

5. Ensure your name and student number are clearly visible on the cover page. Please also provide your tutor’s name on the cover page. State that it is the Law of Business Association Assignment.

6. Please ensure that you fill in, and sign a Statement of Authorship form. The PDF of this form is provided in the LMS below this assignment. Attach the filled in form to your assignment.

7. If you are unable to submit your essay by the due date you should consult your tutor beforehand to see if there are grounds for an extension. Extensions will only be given for very good reasons, normally only medical grounds or other serious interruptions in your ability to work. They are not granted for reasons that should be dealt with by a better organisation of your time and work practices. Nor are they given for reasons that were reasonably foreseeable at the time of enrolling in the subject. To apply for an extension, fill in an Application for Extension form and have it signed by your tutor. The form is available below this assignment in the LMS. Do not forget to attach the approved Application for Extension form to your work.

8. An essay submitted after the due date without an extension having been granted may be penalised by the deduction of one half of one of the marks awarded for each day or part thereof by which it is late. (Saturdays and Sundays are each one day.)

9. No marks will be given for an essay handed in after any response to this assignment has been marked and returned to any member of the class.

10. This assignment counts for 20% of your final marks in this subject.

11. Your response to the question should be no longer than 1000 words. This is an over-estimate of the number of words necessary for a perfect answer. Responses of more than 1000 words may be penalised by the deduction of up to one half of one of the marks awarded for every 250 words by which the response exceeds the limit. There will be no reward given for short answers, other than the good will of the marker.

12. Attention to presentation, expression, and the correct citation of cases, statutes and secondary sources will be rewarded. Footnote your responses on a page-by-page basis. Do not include a bibliography.

13. Plagiarism will be heavily penalised. Plagiarism is defined and discussed in the Academic Misconduct Policy available on the LMS.

14. Keep a copy of your work for your records.

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Assignment

Glamour Developments Pty Ltd (Glamour) is a large proprietary company that constructs multi-level unit developments in inner Melbourne. Glamour has five directors: Jane, Mark, Po, Lim and Afshin. Mark is currently the Managing Director but has indicated to the company his desire to step down due to ill-health within the next month. It is anticipated that Jane will take over as Managing Director when he does so. In fact, the company has already provided Jane with new business cards which identify her as Managing Director for use once the formalities of her appointment have taken place.

Sarah is an architect, known for her avant-garde architecture and use of environmentally-friendly materials.

Jane loves Sarah’s work, which she reads about in New Design magazine. She makes an appointment to meet Sarah, giving Sarah her business card and introducing herself as the Managing Director of Glamour.

Jane then enters negotiations with Sarah to design a new unit development for a site owned by Glamour. Sarah’s fee for the design is $70,000. Jane approves of the price, and Jane and Sarah draw up and sign a written contract.

Sarah completes her design and sends it to Glamour, along with her invoice for $70,000.

Glamour, however, is having financial difficulties due to a downturn in the property market and the other directors, who intensely dislike Sarah’s style of architecture, are furious when they find out about the transaction.

Glamour refuses to pay Sarah, and claims the contract is invalid. It alleges that Jane had no authority to make the contract in the first place and that, under the company constitution, any contract over $40,000 requires the approval of a majority of directors.

Can Sarah enforce the contract?

Would your answer be different if Jane had not negotiated and signed the contract; rather, Po had done so? Jane had asked Po to negotiate the contract, but had told Po that she was not to enter into any contract for more than $40,000. Po was the style advisor for the business and Sarah knew this, but she had never dealt with Po before. Sarah had telephoned Jane to see whether she could deal with Po and Jane had confirmed that Po was to negotiate the contract.

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For some clues and hints, see next page.

Some hints as to how to (1) prepare for and then (2) to answer these questions

First, revise your understanding of how to answer problems. This has been extensively considered in Tutorials.

Then, from your lecture notes and your readings of textbooks etc,:

1. Make a list of the ways by which companies can make contracts.

2. Make a second list of the techniques law uses to deal with issues arising in the making of contracts (e.g, fraud, forgery, acting outside authority, failures to appoint)

3. On your first list, indicate which techniques in the second list are used in what circumstances.

4. For each such circumstance, work out what procedure the law uses to resolve the issue. Some books provide suggested procedures.

5. Check what you have found out by looking what some different textbooks say. Check that you have correctly understood sections in the Act and whatever cases might be relevant.

6. Read one of the questions and work out the story (what happens).

7. Choose which way of making a contract is involved.

8. Determine what issues in that way of making a contract are raised in the question.

9. Use the procedure you have worked out for that issue to indicate how a Court might resolve the problem.

10. Write a response to the question using your procedure.

11. Go back over the answer and check you have all the elements of a good answer: a defined issue, a statement of the relevant law, an application of the law to the facts and a conclusion assessing what a Court might do.

12. Repeat steps 5-10 for the next part of the question.

13. Check expression, citation etc. Ensure there is nothing in your answer which could be thought of as plagiarism.

14. Proof read your response, comply with all formalities (Cover Page has required details, Statement of Authorship is attached, Extension form is attached if necessary) and hand in the assignment according to the Instructions.