law
Research Paper MPA701 CORPORATIONS LAW Freddy and Fiona Freehill are officers and shareholders of Freehills Antiques Pty Ltd. The company specialises in expensive estate jewellery. The company has a credit facility with Prudent Bank Ltd, which the company uses regularly in its business. The company has a constitution that provides that any borrowing beyond the credit facility limit with the company’s bank (in this case Prudent Bank Ltd where the limit is $500,000.00) must be approved by a resolution of the company. Further, the constitution provides any loan documents must be executed by affixing the common seal, irrespective of the law. Freddy is the managing director. Fiona, however, makes all the essential business decisions and has been doing so for some years. After an argument between Freddy and Fiona, Fiona storms off and leaves for the annual London Antiques Fair. She tells Freddy that she won’t be back for two months. Some weeks later Freddy is at the Bendigo Antique Fair and learns of an old colonial settler’s estate coming on the market. The estate consists of a large homestead and outbuildings on 20 hectares of land. It contains antique furnishings, paintings and jewellery. Freddy is very excited and he approaches Prudent Bank Ltd for a loan $1.25 Million to purchase the property. Paul the manager of Prudent Bank Ltd prepared the loan documents. Freddy and his daughter Felicity attend his office to sign them. Freddy explains that as Fiona was overseas for a while they had temporarily removed her from her position and that Felicity was the new director/secretary and was authorised to sign the documents. Freddy and Felicity signed the loan documents and affixed the company seal. Felicity revelling in her new position at Freehills Antiques Pty Ltd decides to lease a new Ferrari for a month and she signed the lease as secretary of Freehills Antiques Pty Ltd. Needless to say Felicity was never appointed the company secretary. When Fiona returns from London she discovers what has happened. The estate bought by Freddy turns out to be worth about half of what the company paid for it. When Freehills Antiques Pty Ltd defaults on its loan Prudent Bank Ltd threatens to bring legal proceedings. a) Fiona informs Prudent Bank Ltd that the loan is not enforceable against the company because the loan documents were not executed by persons authorised by the company and was contrary to the provisions of the company constitution. b) Fiona also tells the Ferrari dealer that Felicity was not the company secretary and had no authority to enter into the contract. Advise Prudent Bank Ltd and the Ferrari Dealer whether they can enforce the contracts. Students are expected to discuss the relevant common law and statutory provisions applicable to this problem in their answer. (Total of 30 marks) SUGGESTED REFERENCES: Lipton, P., and Herzberg, A., Welsh, M, Understanding Company Law, 20 edition Thomson Reuters 2020. Students should remember to look at the Lipton and Herzberg website. www.lipton-herzberg.com.au Harris, J. Hargovan, A. Adams, M. Australian Corporate Law LexisNexis Butterworths 6th edition, 2017. Austin R.P. & Ramsay, I., Ford's Principles of Corporations Law, Butterworths, Australia, 17th edition, 2018. Baxt, R., and Fletcher, K.L., Fridman, S., Corporations and Associations Cases and Materials on, Butterworths, Australia, 10th edition, 2008. Bottomley S, Hall K, Spender P, and Nosworthy B, Contemporary Australian Corporate Law 1st edition 2017 Sydney Cambridge Parker, Clarke, Veljanovski, Posthouwer, Corporate Law, Palgrave 1st edition 2012 Hanrahan, P., Ramsay I., Stapledon G., Commercial Applications of Company Law. CCH 20th edition 2019 Redmond, P., Companies and Securities Law - Commentary and Materials, Law Book Co., Sydney, 5th, 2009. Ciro T, Symes C, Corporations Law in Principle LBC Thomson Reuters, Sydney, 9th edition 2013 Harris, J. Corporations Law, LexisNexis Study Guide 1st edition 2008 Harris, J. Butterworths Questions and Answers Corporations Law:, LexisNexis, 3rd Edition Sydney 2009. Latimer, P, Australian Business Law CC, 2019 Edition. Fitzpatrick, Synes, Veljanovski, Parker, Business and Corporations Law; LexisNexis 2nd edition 2017 · See chapters 5 in Lipton, Herzberg & Welsh 20th Edition Submission: Essays must be submitted on or before Thursday 8th October 2020 by 11.00pm. No extensions will be considered unless a request is made in writing, before the due date, stating the reason for the request. Presentation Readable connected prose NOT point form summaries Accurate spelling, grammar, punctuation, paragraph construction. Proofreading Effective use of HEADINGS Consistent and accurate acknowledgment of sources using a recognised style – both in relation to in-text referencing and bibliography (Note the warning about plagiarism below). Referencing In law, the preferred referencing style is footnoting. Students are reminded that they will lose marks if they merely reproduce passages copied word for word from texts and other references without attempting to convey information and express ideas in their own words. Of course this does not preclude the intelligent use of relevant quotations in respect of which proper references are given. It should be noted that the references must be given in respect of all material included in the essay. References are not to be confined to situations in which the writer is citing a particular case or using a direct quotation. For example, if the writer is putting forward a legal proposition or using a statement or idea drawn from a specific source, that source must be acknowledged by reference. It is essential that references be properly acknowledged at all times and marks will be deducted if this is not done. References may be acknowledged by numbering them consecutively throughout the essay and by giving details of the references by way of numbered footnotes at the bottom of the relevant page, or by way of a list at the end of the essay. Note carefully that the edition and page numbers of references must be given: it is not sufficient to merely give the name and author of the work. When referring to cases, the full case citation must be given. In addition, a bibliography should always be included at the end of the essay. Students should contact the lecturer if they are in any doubt as to the requirements for the giving of references. Referencing: Footnotes or end-notes must be used to acknowledge the source or sources of information contained in the assignment. Footnotes are preferred, but either will be accepted. In regard to the acknowledgment of references and matters of style and presentation, students are referred to: 1. Australian Guide to Legal Citation. For all referencing questions for your assignment or any legal writing See: Australian Guide to Legal Citation: Also see Monash Legal Abbreviations for abbreviations of legal publications. See: http://www.lib.monash.edu.au/legal-abbreviations Students are required to pay careful attention to spelling, expression, and legibility in the writing of their essays. There should be a margin on the left hand side of each page. Students should keep a copy of the essay submitted. Plagiarism Plagiarism is taking another person’s ideas and presenting them as your own, that is, without acknowledging the original source. You must acknowledge your sources of information including both direct and indirect quotations. A direct quotation must always be in inverted commas or in another style that indicates that it is a direct quotation. Your assignment must not consist of quotations only. Plagiarism is regarded as a form of theft or cheating. It is a serious offence and will be dealt with seriously, including a fail grade in this subject. Students should use the Turnitin software to check their assignments for poor referencing and plagiarism. Software such as “turn it in” and others are available. Format · Typed preferably and 1.5 -spaced · Title page with student name and number, Subject code and name, topic · A4 paper · Sequential page numbering · No folders Assignments must be typed (word processor), using one side of the page only and leaving a wide margin. The word limit is 2,000 words. Submission of Late Assignments Assessment items that are submitted after the due date without an approved request for extension will be penalised at the rate of 5% of the mark awarded per day for a total of ten working days. If the assessment item is received after this time or not submitted, the item will not be marked and attract a fail grade The assignment will have a value of 30% for final assessment.