Commercial Law

Commercial Law Order Description Question 1. Materials Ltd (“ML”) sell buildin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing materials and sold 200 tonnes of gravel to Builders Ltd (“BL”) for a price of £8000. BL bought the bulk of the gravel to use in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">in the construction of a new warehouse for Olicana Ltd (“Olicana”) on a site owned by Olicana. BL agreed to sell 25 tonnes of the gravel bought from ML to Patel Builders (“Patel”) for £1750. The 200 tonnes of gravel was delivered to the Olicana construction site from ML’s storage facility contain" rel="nofollow">in" rel="nofollow">in" rel="nofollow">inin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing 20,000 tonnes of gravel. The contract between ML and BL provided that payment was due within" rel="nofollow">in" rel="nofollow">in" rel="nofollow">in 14 days of the in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">invoice which was sent to BL on delivery. BL are in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">in fin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">inancial difficulties and even though BL received an in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">interim payment under their contract with Olicana towards on- goin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing costs of construction in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">includin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing materials, BL failed to pay ML for the gravel. Payment to ML is now 3 months overdue. BL has become in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">insolvent and there is no money to pay ML. 50 tonnes of the gravel has already been used in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">in the construction of the foundations on the site; another 50 tonnes has been mixed with dry cement ready for use in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">in the construction. The remain" rel="nofollow">in" rel="nofollow">in" rel="nofollow">inin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing 100 tonnes of gravel is on the site separated in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">into 2 piles. A smaller pile of a 25 tonnes has been set aside for Patel who paid BL for the gravel, but the gravel is bein" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing stored for them by BL on the site for collection by Patel. Followin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing several downpours of rain" rel="nofollow">in" rel="nofollow">in" rel="nofollow">in, the 2 piles of gravel have spread and grass and weeds have started to cover the small 25 tonne pile of gravel makin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing it very difficult to remove. ? The contract between BL and Olicana for the construction of the warehouse in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">included a clause statin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing that ownership of any buildin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing materials on the site passed to Olicana immediately on payment of the first in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">interim payment under the construction contract. The contract between ML and BL contain" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ined a clause statin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing that ownership in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">in any goods supplied by ML does not pass unless and until the goods are paid for and in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">in the case of any sub-sale, ML have the right to any proceeds of sale. Due to BL’s in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">insolvency, Olicana have employed new contractors to fin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">inish the work and say all the gravel on the site, in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">includin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing that mixed with the cement, belongs to Olicana. Patel say that the pile contain" rel="nofollow">in" rel="nofollow">in" rel="nofollow">inin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing 25 tonnes belongs to them as they have paid for it and ML say that all the gravel in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">includin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing that mixed with the cement and the proceeds of sale belong to them under the terms of their contract with BL. The liquidator for BL is arguin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing that all the gravel belongs to BL and that the clauses in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">in the contracts with ML and Olicana are in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ineffective. A) Advise ML as to the ownership of the gravel. In particular, whether they are entitled to remove the remain" rel="nofollow">in" rel="nofollow">in" rel="nofollow">inin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing gravel in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">includin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing that mixed with the cement and whether they can claim the proceeds of the sale to Patel. (1500 WORDS) Question 2. William and Mary are brother and sister and together operate an estate agency busin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">iness, “Homes R Us”. William started the busin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">iness on his own 5 years ago and in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">initially Mary worked as his part-time secretary. For the last 3 years, Mary has had a greater in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">involvement in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">in the busin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">iness dealin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing with clients, suppliers and placin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing adverts on behalf of the firm. Mary receives a 25% share of the profits by way of a salary. They verbally agreed Mary would not spend over £1500 on behalf of the firm without William’s approval. Without consultin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing William, Mary recently contracted in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">in the name of the firm to buy a digital camera for £4000 to take photos of properties the firm were sellin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing and a fur coat for £3000 to keep her warm when escortin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing buyers on property viewin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ings. In addition, Mary has been placin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing adverts with a local paper owned by her boyfriend and, unknown to William, has been receivin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing a 5% discount on all adverts which she has retain" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ined for herself whilst the firm has paid the full price. 3 weeks ago, William sold 2 laptop computers that he had advertised in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">in the local paper as “nearly new, only 2 years old” to Ivan who has a part-time busin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">iness re- furbishin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing and sellin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing computers for £300. The computers had been used by William and Mary for both personal and busin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">iness use. Ivan has complain" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ined that he wants his money back as one of the computers is not workin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing at all and cannot be fixed and that the other is in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">in fact 5 years old and this has been confirmed by an in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">independent expert. Nothin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing was specifically agreed about the quality of the computers. B) Advise William as to whether or not a partnership exists and, if it does, as to his take again" rel="nofollow">in" rel="nofollow">in" rel="nofollow">inst Mary in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">in respect of her actions.liability and the liability of Homes R Us in" rel="nofollow">in" rel="nofollow">in" rel="nofollow">in relation to the contracts and what action, if any he can (750 words) C) Advise William as to the liability of Homes R Us to Ivan regardin" rel="nofollow">in" rel="nofollow">in" rel="nofollow">ing the sale of the computers. (10%)(250 words)