Partnership in Restaurant Business
1.Issue: it has to be seen if there is a partnership between Michael and Kate. And as a result, Kate is bound by the liabilities of the business that have been incurred by Michael.
Rule: the relationship of partnership is present between the persons who are carrying on a business; in common; and with a view to profit. In case of a partnership, there is an agreement between two or more parties performed legally binding relationship. Essentially this relationship is conceptual in nature. In Green v Beesley (1835), the partnership has been described as a mutual participation yet the participants don’t form a legal entity, while creating a partnership. In this way, and not in a partnership can be described as a partnership that comprises of definite individuals who are bound jointly by contract created between themselves for jointly working for common objective, either during pleasure or for a limited time. Essentially, partnership comprises the persons who have generally entered into the contract with each other (Smith v Anderson, 1880). According to the partnership act, the three elements that are essential for establishing the presence of a partnership can be described as follows:-
- Carrying on of the business;
- In common;
- With a view to profit.
On the other hand, if any of these elements is not present, the relationship between the parties cannot be described as a partnership. The law provides that the partners are jointly and severally liable for the debts and obligations of the business.
Application: In the present case, Michael and Kate are running the restaurant business jointly. Each of them had contributed capital for the establishment of the business. Both of them are equally and acted the involved in the business. It was agreed between them that all costs of the business will be shared equally by them. Similarly, any profit will also be divided equally between them. Under these circumstances in order of a shipment of truffles was made by Michael. He had placed this order without consulting Kate. Two days later, Michael had to go, as his father was ill. While Michael could not be contacted, Kate received a letter from Australian Truffles Delicacies claiming the price of the truffles. Considering the effects of the present is, it can be said that Michael and Kate were running the business as a partnership. Therefore, they can be held liable to pay for the truffles.
Conclusion: in this case, Kate is liable to pay for the truffles that have been ordered by Michael. The reason is that they are considered to be running the business as a partnership.
2.Issue: The issue here is related with the terms and conditions of the contract created between Damion and Cassandra.
Rule: Every contract has key terms. These terms fall into different categories. The parties made expressly agree regarding the terms of the contract, orally or in writing. At the same time, terms may also be implied by the law in a contract or from the conduct of the parties, custom, previous dealing or the intention of the parties.
In this context, the terms of a contract can be described as conditions, warranties and innominate terms. This can be specified by the parties and the contract or implied by the nature of the or implied by law.
Terms of Contract for Motorbike Purchase
A term of the contract can be described as a condition if in case of a breach of the term, the other party gets the right to either terminate the contract or performing. At the same time, in such a case, the aggrieved party also has the right to claim damages.
On the other hand, in case of a breach of warranty, the other party does not get the right to terminate the contract. Therefore in case of a breach of warranty, the aggrieved party only gets the right to claim damages. In this way, a term can be described as a condition if it is a basic term of the contract and goes to the root of the contract. Conversely, a statement or an assurance made regarding a factual matter will generally be considered as a warranty. The difference between the two can be explained with the help of famous cases of Poussard v Spiers (1875) and Bettini v Gye (1875).
In case of innominate terms, the remedy for the breach of contract depends on the effect of the breach. Therefore, if the breach has substantial effect on the eve party, it will be considered as a basic term and give a right to such party to terminate the contract. If this is not the case, the aggrieved party may only claim damages.
Application: in the present case, it was a condition that the bike should be made in Japan. Another condition was that the bike should be of midnight blue color. However, it was a warranty that it was a fantastic bike.
Conclusion: in the present case, there has been a breach of condition. This provides the right to Damien to terminate the contract.
3.Issue: The issue present in this question is, if Sarah is entitled to recover the expectation damages from Vincent Lee?
Rule: expectations loss can be described as the usual measure of damages that may be awarded by the gays in case of a breach of contract. Expectation damages refer to the loss of a bargain suffered by the innocent party, like the profit that would have been expected to be made by such a party in the contract was performed properly, less the cost. That would have been incurred by the party to earn such profit. The purpose behind awarding expectations loss damages is to raise the innocent party in a similar position where it would have been if the contract was performed properly. Expectation loss has to be contrasted with reliance loss, which is also a measure of damages awarded in case of breach of contract and generally known as wasted expenditure.
In Hadley v. Baxendale (1854) the crankshaft of the steam engine of the mill broke down. A replacement was ordered from a supply would require that the broken shaft should be provided for making sure that the replacement was fabricated to correct dimensions. Under these circumstances, Baxendale was hired for delivering the old shaft supplier by a particular date. But there was a delay in the delivery. Consequently, Hadley was delayed in receiving the replacement shaft. During this time the mail cannot be operated and he lost business. Therefore he sued Baxendale for lost profit.
The Court has stated that the lost profits were not the reasonably foreseeable consequence of the failure of Baxendale to perform the contract on time.
Application: because in the present case, Sarah had not informed Vincent Lee regarding the orders with the local hospital and the special orders for glutton free wedding cake, she cannot be allowed to claim these damages from Vincent Lee.
Conclusion: Sarah may claim damages for the breach of contract from Vincent Lee but she cannot be allowed to claim expectation damages for the loss of profit suffered by her as a result of the breach of contract.
References
Bettini v Gye (1875) L.R. 1 QBD 183
Green v Beesley (1835) 2 Bing N C 108
Hadley v Baxendale [1854] EWHC J70
Poussard v Spiers (1875) L.R. 1 QBD 410
Smith v Anderson (1880) 15 Ch D 247
Order an Essay Now & Get These Features For Free:
Turnitin Report
Formatting
Title Page
Citation
Outline
