Corporate Law Financial Statements

Question: Discuss about teCorporate Lawfor Financial Statements. Answer: Explanation of How a Partner can be sued from the Operations of the Partnership Partnership is a business that involves two or more partners to share the business operations together with the share in profitability and liabilities. Partnership business is conducted as per the regulation of Partnership Act and Corporate Law of Australiathat regulates profit sharing, partners liability along with the recognition criteria for the purpose of preparing financial statements and taxable income (Austlii.edu.au. 2017). The business of partnership is conducted as per the consent between the partners as well as according to the partnership deed in compliance with the principles of Partnership Act. Accordingly, the regulations of Partnership Act also provide liability of the partners which is considerably large as all the partners in partnership business are jointly and severally liable. As per the principles of section 10 under Partnership Act, partners are liable for any wrongful activities or omission of activities of partner during the ordinary course of business that c auses loss or injury to the firm as well as to the other partners (Hurt 2015). The ordinary course of business has been clarified by considering the decided case of Polkinghome v Holland (1934) 51 CLR 143 that provides the identification of the nature as well as on the scope of the partnership business. Accordingly, section 10/11 provides that the liability of the partners incorporate misapplication or misutilization of money or misapplication of property then the partner can be sued from the business operations. In case of Mann v Hulme (1961) 35 ALJR 153, the issue involved was making investments in the firm therefore prepared a will assuring the safety of the investments. However, it was found within the firm that the partners misused the funds received by continuing the solicitor practice within the partnership firm (Rubin, Whiteway and Finkelstein 2014). Observing the facts of the case and regulations of Partnership Act, the partner was held liable for misapplication of money. Further, a partner can be sued under the partnership liability if the partner fails to maintain proper records of accounting for the purpose of taxation system or if the partner fails to operate the business assets as per the agreed shareholding, referring to the case of Bowman v Bacon (1897) 18 LR (NSW) 1 2 (Amankwah-Amoah and Debrah 2016). In addition, liability of the partner extends to the outsiders that is liability to the clients and government that incorporates liabilities with respect to the debts or obligations. The regulation of Partnership Act provides that if a partner contravenes the requirements of section 9/10/11 of Partnership Act or fails to act in a good faith to pay off the debts or liabilities as per the contract, then the partner can be sued (Siffert et al. 2015). Moreover, if the partner misapplies the money or property or any other receipt of investment money from the clients, then the client is entitled to sue the accused partner from the operations of business. In case of Ingot Capital Investments Pty Ltd v Macquarie Equity Capital Markets Ltd (2007) NSWSC 124, court held that the firms partner conducted wrongful transactions resulted in loss to the client as well as to the firm hence, the partner was sued from the business operations (Austlii.edu.au. 2017). Corporate Liability and Legal Actions Corporate Liability Pizza Plus Pty Ltd can be Exposed Because of Bettys Actions According to the regulations of Corporation Law, limited companies are exposed to the liabilities as per the value of the shares held by the members of the company. However, in case the company is private limited company having one director, the company will be exposed to certain liabilities if the actions of member cause loss or injury to the clients or consumers. The director of the company owes fiduciary liability to the consumers in terms of causing serious injury to the consumers. Further, failure of director to act as per the requirements of the Corporations Act together with the actions of shareholders exposes the directors as well as the company with the liability of fiduciary duties and statutory duties (Austlii.edu.au. 2017). The given case states that the actions of Betty in terms of pizza delivery by drone used by Pizza Plus Pty Ltd caused serious injury to its consumer due to the fall of drone during the service. Accordingly, Pizza Pty Ltd would be exposed under the corporate liability of fiduciary obligations and statutory duties since Betty has been a member provided secret information of her company Dominos. Similar to the case of Andar Transport Pty Ltd v Brambles Ltd (2004) 28, the company as well as the director of the accused held liable under fiduciary obligations since it caused serious injury to the plaintiff due to the actions of its shareholders. Further, Pizza Plus Pty Ltd would be exposed to the corporate liability with respect to the Contractual Liability since directors is personally liable for the injury caused by the services provided by the company. Contractual liability would be imposed on Will as a director since he is the only director of the company and was responsible for the ne w service conducted to deliver pizza to the consumers (Jones 2015). The injury caused to Jill involved proceedings under Personal Injuries Act as the service incorporate by Pizza Plus Pty Ltd falls under the act of negligence, which is similar to the case of Rainham Chemical Works Ltd v Belvedere Fish Guano Co. Ltd (1921) 2 AC 465. In addition, Pizza Plus Pty Ltd would be exposed to the statutory liability due to the actions of Betty, companys shareholder and a director of Dominos Australia Ltd. It has been mentioned that Betty entered into unlawful actions by providing the secret details of Dominos to Will; therefore, the company will be exposed to the statutory liability as it is illegal to ascertain secret details of other company. In case of Hamilton v Whitehead (1988) 166 CLR 121, court held that the defendant held liable under statutory liability since the services availed by the person caused serious injury to the plaintiff which was copied illegally from other sources. Accordingly, Pizza Plus Pty Ltd would be exposed to statutory liability together with the other liabilities under Corporations Act (Beale 2016). Legal Actions and Explanation of Areas of Law that may be Involved As the business services provided by Pizza Plus Pty Ltd caused serious injury to the consumer, Jill, he is entitled to take legal actions against the company as well as against the Will since he is the only director in the company. Other than the exposure of corporate liability, Pizza Plus would be exposed under the regulations of Australian Consumer Law (ACL) that associates with the consumers rights and obligation (Austlii.edu.au. 2017). The given situation states that the delivery services provided by Wills company Pizza Plus that included delivery of Pizza by using drones which fell on the head of Jill and caused serious injury. Therefore, Jill is entitled to take legal actions against Pizza Plus under the regulations of Australian Consumer Law against consumer guarantees applicable to the business services. It is essential for the business organizations to provide the services with due care and skills and within the reasonable time. Accordingly, Jill can take legal actions under personal injury and sue the company together with the claim on compensation charges for the injuries that caused as a result of services problems (Leenders and Gabbay 2013). Similar to the case of Andar Transport Pty Ltd v Brambles Limited, liability on the defendant imposed under common law since defendant for lack of reasonable care and consumers protection through the business services. In the present case, services of Pizza Plus caused injury to Jill that incorporates the regulations under corporate law as well as Consumer law with respect to the rights and obligations for consumers. Corporate law incorporate legal actions against the personal injury to the consumers due to the personal injury including the fiduciary liability for providing negligent service to the consumers. Moreover, the present situation also involves the liability under common law for not considering due care and skills to provide the delivery services of pizza to the consumers. It has been observed that Pizza Plus contravened the regulations of Corporations Act together with the Consumer Act for not complying the services in consideration with the safety of the consumers. Similar to the case of Briggs v James Hardie (1989) 16 NSWLR 549 in which court held that there was no clear and unambiguous doctrine present and harmed the clients, hence the company held liable under corporate law (Austlii. edu.au. 2017). Further, regulations of Consumer Law would be applied on Pizza Plus since the company contravened the principle on considering consumer guarantee with respect to maintain the quality that caused significant loss to the consumers. Therefore, Jill has the right to take actions against Pizza Plus Pty Ltd under corporate law for contravention of principles in terms of personal injury, contractual liability while legal action under consumer law in terms of consumer obligations. Reference List Amankwah-Amoah, J. and Debrah, Y.A., 2016. Toward a construct of liability of origin.Industrial and Corporate Change, p.dtw021. Austlii.edu.au. 2017.Australasian Legal Information Institute (AustLII). [online] Available at: https://www.austlii.edu.au/ [Accessed 1 Feb. 2017]. Beale, S.S., 2016. The Development and Evolution of the US Law of Corporate Criminal Liability and the Yates Memo.Stetson L. Rev.,46, p.41. Hurt, C., 2015. The Limited Liability Partnership in Bankruptcy.Am. Bankr. LJ,89, p.567 Jones, M.R., 2015. The Alien Tort Statute and Corporate Liability: Rebutting the Extraterritorial Presumption Post-Kiobel.Ga. St. UL Rev.,32, p.699. Leenders, R.T.A. and Gabbay, S.M. eds., 2013.Corporate social capital and liability. Springer Science Business Media. Rubin, B.D., Whiteway, A.M. and Finkelstein, J.G., 2014. Proposed Partnership Liability Allocation Regulations: An Unworkable Solution in Search of a Problem.J. Passthrough Entities,17, p.31. Siffert, J.S., Rakoff, J.S., Reiss, S.A., Loughlin, W.P. and Allen, S.W., 2015. Corporations and Corporate Liability.Modern Federal Jury Instructions-Civil,4.