BUMAN103A Business Law; Michael and Kate have decided to open a new restaurant together in Parramatta. They have each contributed capital to get the business established, as well as equipment and contacts within the food industry that will benefit the enterprise

BUMAN103A Business Law; Michael and Kate have decided to open a new restaurant together in Parramatta. They have each contributed capital to get the business established, as well as equipment and contacts within the food industry that will benefit the enterprise 150 150 Affordable Capstone Projects Written from Scratch

Answer all three (3) questions using the IRAC method detailed in your tutorials:

I = ISSUE. This should be a one or two sentence statement about the legal issue in question in the scenario. Do not restate the facts of the scenario here.

R = RULE. A detailed explanation of what is involved in the issue you have identified. This should include a thorough discussion of definition, either statutory or common law, as well as remedies or defences for the issue in question. Do not state the facts of the scenario in this part.

A = APPLICATION. Apply the points you have identified in the Rule stage to the facts in the scenario

C = CONCLUSION. Use your rationale and findings from the Application stage to present a logical conclusion on the issue. Your Conclusion should address the points you made in identifying the original issue.


Your answers need to be based on the sound legal principles that you have discussed in class, not on your opinion. It is also recommended that you strongly support your answers with either statute or case law precedent, although there is no requirement to explain the facts of a precedent case.

Make sure you use correct legal formatting when you cite legislation or case law:

  1. With a statute, italicise the name and year of enactment of the legislation, and ALWAYS include the jurisdiction to which the Act or Regulations apply;
  2. With case law, italicise the names of the parties. At first mention, include the full legal citation, either in your text or footnotes. You may abbreviate the case name for subsequent mentions.


Michael and Kate have decided to open a new restaurant together in Parramatta. They have each contributed capital to get the business established, as well as equipment and contacts within the food industry that will benefit the enterprise.

They will both be actively involved in the restaurant. Michael will be responsible for purchasing food and other items needed for the business, as well as overseeing the marketing that will need to be done. Kate will concentrate on keeping the books of the business in order and recruiting of staff. They will share the responsibility for training their staff and operating the restaurant.

Michael and Kate agreed that they would share all costs equally and calculate profits monthly. Any profits would be split 50:50 between them.

Their restaurant, Salamander, opened on 2 July 2018. Whilst it was not a raging success, turnover was sufficient to be encouraging for them.

On 11 September 2018, Michael ordered a shipment of truffles for the restaurant from Australian Truffle Delicacies in Tasmania. He placed the order without consulting with Kate, as it was a sudden and unexpected opportunity to cash in on a rare and valuable luxury food item that he had long wanted to include on a menu.

Two days later, Michael received a telephone call telling him that his father was terminally ill, and so he left immediately to be by his father’s bedside at his home in outback Queensland. He told Kate that he would return as quickly as possible, however he would be out of contact for the time he was away because of the remoteness of his family home.

Kate received a letter on 28 September 2018 from Australian Truffle Delicacies stating that the truffles were sold on 7-day trading terms, and that the full $9,000 is now due. Michael is still away and not contactable, and the supplier is now threatening to take Kate to court to claim full payment from her.

Using IRAC, advise Kate of whether she would be considered a partner in the business, and her personal liability for the $9,000 owed to Australian Truffle Delicacies.

Make sure you support your response with relevant case or legislative authorities.


Damien decides that he wants to but a new motorcycle. He goes to the local dealership and is met by Cassandra who asks if she can help him and whether he is looking for anything in particular.

Damien says that he has his heart set on a motorbike that was made in Japan, as he had heard that they were extremely well-made and that custom parts are readily available in Australia. Cassandra tells him that all of the Yamaha, Suzuki, Kawasaki and Honda bikes in the dealership are made in Japan. He also mentions that he has long wanted a midnight blue Honda but has been unable to find one in this colour at any other showroom.

Cassandra shows him a black CBR1000 model, and is informed that it is available in midnight blue but that it would need to be ordered in. Damien is told that the price is $17,000 including stamp duty, and that this is an extremely popular model, and a fantastic bike at this price.

On the basis of this information, Damien agrees to buy the base model, in midnight blue, along with a matching helmet. Delivery is to be made by Friday the following week, so that he has the entire weekend to use it. He makes full payment and provides his address for delivery.

The bike is delivered on Saturday afternoon, and Damien notices immediately that it is the black bike that he was looking at in the store. He also lifts up the seat and sees a metal label that says “Made in USA”. The helmet is also missing.

He finds an old helmet and takes the bike for a ride. Although he likes the way the bike rides, he is disappointed with the seat and finds it uncomfortable to sit on for longer than 15 minutes. Having ridden many different bikes, he does not believe this one to be a “fantastic bike” as it was described, even at that price.


Advise Damien of the terms of this contract, and classify each of the terms you have identified, supporting your answer with relevant legal authority where appropriate.


Sarah operates a boutique patisserie and bakery in Paddington. Following the trend in the area, she has recently started selling a wide range of gluten free products and has been searching for a reputable local supplier of gluten-free flours. She finally locates Vincent Lee Milling, a small operation that has branched out into these specialty flours.

Last Monday Sarah telephoned Vincent Lee and informed him that it was very important that the flour have absolutely no traces of gluten, as Sarah’s customer base included many people with a severe gluten intolerance, including patients in local hospitals. Vincent assures Sarah that the rice flour will be suitable and so Sarah orders 50 sacks, and asks that it be delivered on Tuesday night before 8:00pm as she has orders for gluten-free bread to meet for the following day.

The flour is delivered at 7:30pm on the Tuesday night. When Sarah’s senior pastrycook goes to open the bags at 3:00am the next morning to start baking he notices inside the sack a tag that states that the flour is processed on machines that are used for other grains and may therefore contain traces of gluten. Sarah makes the decision not to use the flour and proceeds to just bake her regular products.

The next day Sarah informs Vincent that she is terminating the contract for supply of the special flour, and is claiming $6,000 in damages, being the anticipated profit she expected to make from:

  • supply of 800 loaves of gluten-free bread to four major Sydney metropolitan hospitals in the area ($2,500);
  • supply of 200 loaves of gluten-free bread to general customers in the area ($500);
  • profit from supply of a special order for a gluten-free wedding cake for a local celebrity who he is not allowed to name. ($3,000)

to the local hospital ($500) and for the profit for a special order for a gluten free wedding

cake for a local minor celebrity who he is not allowed to name ($2500).


Advise Vincent Lee whether Sarah is entitled to the remedies she has claimed. Be specific in your advice and support your answer with relevant legal authority where appropriate.