Business Law 笔记.docx

Section 5 of the PA defines a partnership as: “the relation which exists between persons carrying on a business in common with a view of profit”.(1) The answer to the question “does a partnership exist?” depends on the actual intention of the parties. 1. The normal practice is for the parties to enter into a written agreement prepared by professional advisers2. In the absence of a written agreement, the parties respective intentions surrounding their relationship will be crucial3. A partnership is contractual in nature a partnership can arise by a formal or simple contract,4. be oral and/or written, or implied from the conduct of the parties.(2)“Carrying on a Business” Definition: There must be a degree of repetition in the parties conduct. An isolated act or transaction will not be carrying on a business unless there is either a contrary intention or the parties intend that the act, transaction or venture will be repeated. Smith v Anderson (1880)(3) “In Common”1. Each party acts as an agent for the other. Agency means that each partner acts on behalf of the principal (which is the partnership) and has the power to bind the other partners to his or her actions (e.g. entering a contract). 2. The parties share rights and obligations so that each participant benefits from and is liable for partnership obligations. Kang-Kem v Paine (2004)(4) “With a View of Profit”The Partnership business must have been established with the intention of making a profit. Section 6:Rule 1: Co-ownership of PropertySection 6(1)(a) PA: The joint ownership of property does not itself create a partnership irrespective of whether the owners do or do not share in any profits made by the use of the property or whether the property is held as joint tenants or tenants in common.Rule 2: Sharing of Gross Returns Section 6(1)(b)PA:The sharing of gross returns does not of itself create a partnership, whether the persons sharing such returns have an interest in any property which is utilised to obtain the returnsCribb v Korn (1911)Rule 3: Sharing ProfitsSection 6(1)(c):The receipt by a person of a share of the profits of a business is prima facie evidence that the person is a partner in the business, but simply receiving such a share does not mean the person is a partner(a)Debts paid out of Profits. section 6(1)(c)(i)A person that is repaid a debt out of the business profits does not itself make the person a partner in the business Cox v Hickman (1860)(b)Payments to Employees and Agents. section 6(1)(c)(ii)The payment of a share of profits to an employee or agent of the business under a contract does not make the agent or employee a partner in the business(c)Payments of Interest. sections 6(1)(c)(iv) and 6(2)A lender of money to a partnership who receives interest based on the partnerships profits or a percentage of profits instead of interest, does not become a partner in the business, provided that the contract of loan is in writing and signed by the parties.Section 8 recognises that each partner is an agent of the firm and therefore bound to a partners actions within their actual authority. Further, there are four requirements to establish apparent authority:- 1.The transaction involved must be within the scope of the partnership business (“business of the kind”);2. The transaction must be effected in the usual way;3. The outsider knew or should have known that the partner had no actual authority; 4. The outsider must have known, or at least must have believed, that the person with whom he or she was dealing was a partner. Polkinghorne v Holland (1934)Mercantile Credit Co Ltd v GarrodSection 10: If one partner pledges the credit of a firm for a purpose apparently not connected with the firms ordinary course of business, the firm is not bound, unless the partner is in fact specially authorised by the other partners.Goldberg v Jenkins. Section 11 provides that the firm will not be liable for a partners actions which exceed those express restrictions if the other party to the transaction had actual knowledge of the restrictions.Section 12: Every partner in a firm is liable jointly with the other partners for all debts and obligations of the firm incurred while a partner.1. “Debts and obligations of the firm”: Does not apply to a personal debt or obligation, even if it is for the benefit of the firm.2. Joint Liability: Joint liability means that the partners (or firm) can only be sued in one legal action. If some of the partners are sued and found liable, the other partners cannot be sued later. Kendall v Hamilton (1879)Section 13: The partnership is liable in tort for the wrongful acts or omissions of any partner acting in the ordinary course of the firms business or with the authority of the other partners, where a third party suffers loss or injury.1. A wrongful act or omission;2. Committed by a partner;3. The partner was acting either in the ordinary course of the firms business or with the actual or apparent authority of his or her co-partners (dealt with in s8); and 4. The person suffered loss or injury. Proceedings Commissioner v Ali Hatem 1999 section 14 Liability of Partners for Misapplication of Money or Propertys14(1)(a): If a partner is acting within the scope of the partners apparent authority, receives money or property of a third person and misapplies itsection 14(1)(b): A firm in the course of its business receives money or property of a third person, and the money or property so received is misapplied by 1 or more of the partners while it is in the custody of the firm A firm in the course of its business receives money or property of a third person, and the money or property so received is misapplied by 1 or more of the partners while it is in the custody of the firmsection 15: Liability for misapplication of money or property is joint and severalsection 20: A partner is only liable for partnership liabilities incurred while a member of the firm:1. The partner is not liable for what happened before becoming a partner or what happened after retiring from the firm (subject to s39); and 2. Outgoing partners will continue to be liable for debts and obligations incurred whilst a partner (subject to obtaining a release or indemnity). 3. Retired partners will be liable for all debts and obligations incurred while a partner.Section 23 of the PA: “Assets that have become partnership property will belong to the partners collectively rather than to each partner individually”.Section 24 of the PA: “Property bought with money belonging to the firm is deemed to have been bought on the account of the firm”.Kelly v Kelly (1990)Section 27 (1)(a) of the PA: “The partners are entitled to share equally in capital and profits and each must contribute equally to make up the firms losses”. Kilpatrick v Mackay (1878)Section 27(1)(b) - Right to Indemnity: “The firm should indemnify partners for personal liabilities incurred in the ordinary and proper conduct of the business of the firm”.Section 27(1)(e) - Powers of Management: “Every partner may take part in the management of the partnership business”.Section 27(1)(f): Right to Wages or Other Payment “No partner is entitled to remuneration for acting in the partnership business”.Section 27(1)(g): Introduction of Partners “No person may be introduced as a partner without the consent of all existing partners”. Section 27(1)(h): Resolution of Differences “Any dispute arising as to ordinary matters connected with the partnership business may be decided by a majority of the partners. However, no change may be made in the nature of the partnership business without the consent of all the existing partners”. Expulsion of Partners- Section 28Section 28 of the PA：“No majority of the partners can expel any partner unless a power to do so has been conferred by express agreement between the partners”.Section 29 of the PA：“Where no fixed term has been agreed upon for the duration of the partnership, any partner may determine the partnership at any time on giving notice.” section 31 - Duty to Render Accounts：Partners must render (i.e. provide) true accounts and full information of all matters affecting the partnership. Law v Law 1905 Section 32 - Account of Profits：Partners must account to the firm for any benefit they obtain without the consent of the other partners from:1. Any transaction concerning the partnership2. Any use of partnership property, name or business connections. Birtchnell v Equity Trustees (1929)Section 33 - Competing with the Firm: A partner must not carry on a business of the same nature as and competing with the firm without the consent of the other partners.1. The partner must not carry on a business of the same nature as the firm (e.g. Aas v Benham ); and 2. That business must not compete with the firm. Section 34 - Assignment of Partnership Interest：Partners can assign (or in other words transfer) all or part of their individual shares and interests to others. Such assignments do not require the prior consent of their fellow partnersDissolution of Partnership(a) by agreement section 35(b) expiry of a fixed term partnership section 35 (c)notice of dissolution section 35(d) bankruptcy or death of a partner section 36 (e)if the partnership becomes unlawful section 37By the Court Order: section 38:where a partner has been declared to be of unsound mind; s 38(a) Gibbons v Wright (1954) 91 CLR 423.permanent incapacity; s 38(b) Payton v Mindham (1971) 3 All ER 1215.where a partner is guilty of conduct which, in the opinion of the court, is calculated to prejudicially affect the business; s 38(c). Jenkins and Joaquim v Bennett (1965) WAR 42.where a partner has engaged in willful or persistent breaches of the partnership agreement; s 38(d) Campbell v Blair (1873)when the business can only be carried on at a loss; s 38(e) Jennings v Baddeley (1856)where it is just and equitable: e.g. guilty of misconduct; breach of mutual trust and confidence; continual disagreement between the partners: s 38(f) Knight v Bell (1887; Cayron v Rusell (1897).NEGLIGENCE FRAMEWORK (GENERAL) (i) Did Defendant (D) owe Plaintiff (P) a duty of care recognised by law? Law: Foreseeability: An objective test would a reasonable person have foreseen that harm may result from Joels parents actions? The question can also be put this way: “what class of people might possibly be at risk of loss, injury or damage by the defendants actions?” (Chapman v Hearse) Plaintiff must be in a sufficiently proximate relationship with the Defendant (Jaensch v Coffey). (a) Reasonable Foreseeability: Objective test can be considered in two ways:Nova Mink Ltd v Trans Canada AirlinesHay (Bourhill) v. Young 1943 Would a reasonable person have foreseen that harm Harm includes (but is not limited to) personal injury, property damage and economic loss may result from Ds actions? Did P come within a class of people that might possibly be at risk of harm by Ds actions?(b) Proximity: Is P and D in a sufficiently proximate (or close) relationship?Jaensch v Coffey (1984) Physical proximity space or time between the person or property of P and the person or property of D; Circumstantial proximity exists in particular circumstances (e.g. employees and employers, professionals and clients) Causal proximity closeness or directness of the relationship between Ds act / omission and Ps harm.(ii) Did D breach the duty of care? If yesLaw: The risk of harm must be foreseeable (section 9(1)(a) CLA), not be insignificant (section 9(1)(b) and a reasonable person in the position of the Defendant would have taken the precautions against the risk of harm (section 9(1)(c). In deciding the third issue, the Court considers the following factors:- The probability that the harm would occur if care were not taken (section 9(2)(a); The likely seriousness of the harm (section 9(2)(b); The burden of taking precautions to avoid the risk of harm (section 9(2)(c); and The social utility of the activity that creates the risk of harm (section 9(2)(d) (a) Was the risk of harm foreseeable? (section 9(1)(a) CLA). The risk is what D knew or ought to have known based on an objective test (i.e. reasonable person in position of D).(b) Was the risk not insignificant? (section 9(1)(b). (c) Would a reasonable person in the position of D have taken the precautions against the risk of harm? (section 9(1)(c). 4 Factors: (1) The probability of harm if care were not taken (section 9(2)(a) Lower probability = reasonable person less likely to take precautions(2) The likely seriousness of the harm (section 9(2)(b) Greater seriousness of harm, greater the precautions that are required of D. Does P have a vulnerability that D has special knowledge of? If yes, D is required to take greater precautions to minimise risk of harm than to the general public (3) The burden of taking precautions to avoid risk of harm (s 9(2)(c) What is the expense and inconvenience of removing the risk of harm? Small expense and little inconvenience = reasonable person likely to take the precautions. (4) The social utility of the activity that creates risk of harm (s 9(2)(d) If relevant, how useful is the activity to society? Weigh utility against probability and seriousness of harm (iii) Did P suffer harm as a result of the breach of duty? If yes Law: Two relevant legal areas under this issue:- Factual causation the Ds breach of duty in fact caused the Ps harm (section 11(1)(a). If it is relevant to factual causation, the Court may apply the “but for test” would the P have suffered harm but for the Ds negligence? (section 11(3). P must prove on the balance of probabilities that D in fact caused Ps harm; Scope of Liability It is appropriate for the scope of the Ds liability to extend to the harm caused (section 11(1)(b). The issue is: should the D be responsible for the harm (section 11(4) or is the harm too remote a consequence of the Ds negligence? (e.g. Wagon Mound cases). (a) Factual causation: Did Ds breach of duty cause Ps harm? (s11(1)(a) But for test (if relevant): Would P have suffered harm but for Ds negligence? (s11(3) Common sense test: Can P prove on the balance of probabilities that D in fact caused Ps harm? Wiegold v State Rail Authority Is there a Novus Actus Interveniens? If yes, the answer to (iii) is no. An event which is not reasonably foreseeable and breaks the chain of causation between Ds negligence and Ps harmYates v Jones 1990(b) Scope of Liability: It is appropriate for the scope of Ds liability to extend to the harm caused (section 11(1)(b) Should D be responsible for the harm (section 11(4) or is the harm too remote a consequence of Ds negligence? Would a reasonable person have foreseen the kind of harm suffered by P? If no, the loss is too remote. (iv) Can D rely on the defences of contributory negligence or voluntary assumption of risk? If NoLaw: Contributory negligence is when the Plaintiff is at fault and that contributes to the Plaintiffs harm. The Court applies the breach of duty factors under the CLA when determining contributory negligence (s 23). The Court will calculate the total damages payable to the Plaintiff if there was no contributory negligence, then apportion liability between the Plaintiff and Defendant in percentage terms (Ingram v Britten). (a) Contributory Negligence: P partially at fault which contributed to Ps harm. Apply the breach of duty factors in (ii) above using P, not D (s 23); If there is contributory negligence, Court will apportion liability in % terms between P and D; Court can apportion liability 100% to P if it considers just and equitable to do so (s 24). (b) Voluntary Assumption of Risk: Is the risk caused by a dangerous recreational activity? Dangerous Recreational Activity: An “activity engaged in for enjoyment, relaxation or leisure that involves a significant degree of risk of physical harm to the person” (section 18)Dangerous Recreational Activity Test (section 19) Ps harm was suffered as a result of the materialisation of an obvious risk. P was engaged in a dangerous recreational activity Obvious risk relates to the dangerous recreational activity.Any activity with the exception of a dangerous recreational activity Was P aware of the risk of harm caused by D? If a risk is obvious, a person is deemed to be aware of the risk unless P proves, on the balance of probabilities, that P was not aware of the risk (s14(1); Obvious Risk: A risk that, in the circumstances, would have been obvious to a reasonable person in the position of P (section 13(1): Includes: Risks that are clear or common knowledge (section 13(2), and may be obvious even if the probability of the risk occurring is low (section 13(3) or if the risk is not “prominent, conspicuous or physically observable” (section 13(4). Does not include: A risk created by Ds failure to properly operate, maintain, replace, prepare or care for a thing (s 13(5) Did P consent to participate in the activity that created the risk? This is a question of fact determined by P and Ds evidence (in your case, the facts of the hypothetical) (v) Court to assess P damages Consumer ProtectionSection 18 Misleading or deceptive conduct : “A person must not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.”(1) First, there must be conduct on the part of a corporation(2) Second, the activity mu