LST 2 LBA: Law of Business Association
Semester 1 2017
1. This assignment counts for 25% of your final marks in this subject.
2. This assignment is due in by Midnight on Monday 1st May 2017.
3. An essay submitted after the due date without an extension having been granted attracts a penalty of 5% per day (or part thereof) of the marks available for the task. No marks will be given for an essay submitted after any response to this assignment has been marked and returned to any member of the class.
4. The Subject Learning Guide sets out the policy on the granting of extensions. Please note that 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 were reasonably foreseeable at the time of enrolling in the subject.
5. The total assignment word limit is 1500 words. Further, your answer for each of the two questions should be no more than 750 words. This is an over-estimate of the number of words necessary for a perfect answer. Responses of more than 1500 words in total may be penalised by the deduction of up to one-half of one of the marks awarded for every 100 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.
6. Attention to presentation, expression, and the correct citation of cases, statutes and secondary sources will be rewarded. Use a recognised and consistent referencing style. Do not include a bibliography.
7. Plagiarism will be heavily penalised. Plagiarism is defined and discussed in the Academic Misconduct Policy available on the LMS.
8. Assignments are to be submitted on-line via Turnitin on the LMS.
9. Ensure your name and student number is clearly visible on your assignment. Please also provide your tutor’s name on the assignment.
10. Keep a copy of your work for your records.
Students must attempt BOTH Questions.
Question 1 – 15 Marks
William is bankrupt and therefore cannot act as a director of a company. Nevertheless, he does so. Harry is the managing director of the same company. Harry gives William a letter addressed to the other party to the contract saying that that William has authority to enter into a contract. Harry, however, privately tells William that he is only to negotiate the contract, but is not to enter into it. Nevertheless, William signs the contract as agent of the company.
a. Is the company bound by the Contract? Provide reasons for your answer.
b. Would it make any difference to your answer if Harry were only acting as managing director, never having been appointed to the position?
Question 2 – 10 Marks
Maria is one of two directors and shareholders of a company. David is the other director and shareholder. Maria wants to borrow $100,000 for both the company and for private purposes from a bank. She borrows the money in her own name, but the bank wants a guarantee from the company. She knows David will refuse to do so, so she signs the guarantee ‘Maria, director’ and writes ‘David, director’ in writing that is dissimilar to her own. If Maria fails to meet payments under the loan agreement, can the bank enforce the guarantee against the company?
General Guidelines for Preparation of Your Answers For Questions 1 and 2
First, revise your understanding of how to answer problems. This has been addressed in Tutorials and resources are available on the LMS to support you.
Then, from your lecture notes, tutorial answers and textbook reading:
1. Make a list of the ways by which companies can make contracts.
2. Make a second list of the techniques the 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 question.
13. Check expression, citation etc. Ensure there is nothing in your answer that would be considered 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.