You are to take the role of a legal adviser to each of the clients described in the five situations given below. To each client you should advise: • What kind of business structure or entity is most appropriate for the client’s needs, and the specific reasons for this

You are to take the role of a legal adviser to each of the clients described in the five situations given below. To each client you should advise: • What kind of business structure or entity is most appropriate for the client’s needs, and the specific reasons for this 150 150 Affordable Capstone Projects Written from Scratch

LAW610 Company Law Assignment
DUE: Friday September 28, 5pm.
To be submitted via Moodle in Microsoft Word format.
WEIGHTING: 30% of your final grade.
To be marked out of 60.
INSTRUCTIONS: This assignment contains two parts. You need to answer BOTH parts, following the instructions given under each part.
Learning Outcome 1:
Recognise the categories of business entities in New Zealand.
Learning Outcome 2:
Illustrate the legal consequences of the choice of each of the common business entities (company, partnership, trust and sole trader).
Learning Outcome 3:
Recognise the law relating to partnerships (formation; legal consequence of organisational structure; liability in tort and contract; rights, powers, and duties of partners).
Learning Outcome 4:
Outline the documentation required for forming a company.
Learning Outcome 7:
Illustrate the organisational structure of companies, and the consequent legal implications.
PART A: Legal Advice (30 marks)
You are to take the role of a legal adviser to each of the clients described in the five situations given below. To each client you should advise:
• What kind of business structure or entity is most appropriate for the client’s needs, and the specific reasons for this
• All the steps and documentation, if any, necessary to establish and operate the business or entity, including:
o The links to any forms that need to be completed
o The name and section numbers of any relevant legislation
Note: When stating legal principles or requirements you should reference any relevant statutory provision by section number, but you should NOT copy out passages of legislation. Instead, explain the practical application of any relevant legal provision, e.g.:
“In accordance with section 22 of the Companies Act 1993, you will be required to apply for reservation of the name of your proposed company…”
• Any ongoing reporting or other regulatory requirements
• Any potential disadvantages, challenges, or consequences that people need to be mindful of when operating under the advised business structure or entity.
Your combined answers to the five situations in Part A should be 1,000-1,500 words IN TOTAL. However, some answers will need to be more detailed than other answers and will naturally require more words. You will be awarded a mark based on how well you answered the five situations OVERALL, rather than each situation being worth the same number of marks. It is up to you to determine which of the situations require more details due to the greater complexity involved.
Situation 1
Bernard is a businessman who, along with his wife Sylvia, has worked hard for more than 40 years to build up a large plumbing business. Bernard and Sylvia have accumulated significant wealth and are very comfortable financially, but are simple folk at heart and have no wish to buy fancy cars or go on luxury holidays. Instead they want to use what they have to help their four teenage grandchildren, who they feel will have a tough road ahead given the high cost of both education and housing. They have three tenanted investment properties, and a share portfolio worth over $500,000. They want to use this for their grandchildren to get a good education and then to help them get a deposit for a house. Bernard would like to have some say in how the investments are managed and any significant sales or purchases of these investments, but wants to leave most of the day-to-day running and requirements to professionals.
Situation 2
Rick is an American billionaire who loves New Zealand and has spent a lot of time in the country over many years. After gaining NZ citizenship, he has purchased a huge property bordering the Mt Richmond Forest Park. Rick is a great mountain-biking enthusiast and wants to create a private mountain-biking park on his property which will cater to high-paying clients. Rick wants to keep a very low profile and does not want to bother with any day-to-day management or promotion of the business, he really just wants to be able to go mountain-biking when he feels like it. Through a mutual friend he has met a local man named Jim who will take care of the management of the mountain bike park, in return for both a modest wage and a share of profits in the venture.
Situation 3
Petra is a widow in her early 70s who is a long-time potting enthusiast. She lost her husband Brian six months ago after looking after him through a long battle with cancer. She now wants to keep herself busy and loves making pottery, so she has recently made enquiries about selling her pottery items at local markets and shops, and received a positive response. She would like to make an income of approximately $10,000 per year from selling her pottery to supplement her superannuation. She wants as little hassle as possible in terms of any reporting or regulatory requirements.
Situation 4
Erica, Joe, Charles and Gina are software programmers and graphic designers who have come up with a big idea for a new app. They are reluctant to share too many details about their idea, but they believe that if it goes well it could make millions of dollars. They want to ensure that each of them have an equal share of ownership in the business initially, but with the ability to vary the ownership proportions or sell a share of ownership in the business to potential investors in the future.
Situation 5
Jeremy and Andrea both have considerable experience in environmental planning and resource management roles, and have decided to go into business together as planning consultants. They will offer a wide range of services in relation to planning and development. They believe their skills and knowledge are complementary, and given they have similar levels of experience and have earned similar salaries in recent years, they are happy to share equally in the proceeds of the business for the first three years, and then re-evaluate after that time. Andrea is willing to contribute $30,000 of her own savings toward the costs of setting up the business, and they have agreed that money will be repaid to her over the first two years of the business, with an appropriate rate of interest. Jeremy and Andrea hope to be able to pay themselves a set figure of $1,200 per week each, and then share in any profits at the end of the year.
PART B: Essay (30 marks)
Write an essay which provides a critical evaluation of the following paragraph:
“Law and accounting firms historically operated as partnerships and for many years were prevented by law from incorporating. The changes in law that have allowed them to incorporate are significant developments for these professions. The benefits of operating as a company considerably outweigh those of operating as a partnership and it is inevitable that the company will become the default legal structure in these professions”.
Your essay should include discussion of the following:
• The reasons that law and accounting firms used to be prevented from incorporating
• The changes in law that allowed law and accounting firms to incorporate, and the stated reasons for these
• The legal and practical advantages and disadvantages of incorporating in comparison to operating as a partnership, including both external regulatory requirements and any implications for internal management
• The proportion of legal and accounting firms which actually have incorporated, and the reasons firms have stated for their choice in this matter
Note: When critically evaluating a passage of writing, you should:
• Focus strongly on the key words and phrases used in the passage and incorporate them into your answer
• If the passage is made up of more than one claim or assertion, examine each one separately
• Always consider and discuss both supporting and opposing arguments for each claim, even if you do not agree with them
• Reach a clear conclusion about which argument you believe is stronger
Your essay should be approximately 1000-1,500 words.
You should consult and reference A MINIMUM OF 10 EXTERNAL SOURCES as part of your research for this essay, and acknowledge all sources where appropriate using APA referencing.
Do NOT quote long passages of text from external sources. The purpose of using quotes should only be to illustrate words or phrases which have come to have particular significance in the context of the topic, NOT as an easy way to explain a point. Even if you enclose a passage of text “in quotation marks” and reference it properly, you will NOT be given any credit simply for copying and pasting. Endeavour to paraphrase as much as possible.