Answer the following questions using the ILAC method of problem solving.

Question 1 [15 marks]

• Manuel Schmick graduated from the National University of Hairdressing with a major in hairstyling for spunky lads. After attending his graduation, Manuel watched a youtube video that inspired what he deemed to be his true calling; opening and owning a chain of hairdressing salons in Western Sydney specialised in male grooming.In early 2019, Manuel decided to expand his business across New South Wales.He scheduled and attended a meeting with Loren Knowsitall, an accountant and financial adviser, for the purpose of discussing his financial position and the prospects of business expansion. They discussed Manuel's expansion plans and Loren agreed to business plan for Manuel and his alleged hairdressing empire. Loren advised Manuel that he was in a sound position to expand the business and recommended that he borrow money to set up five salons in Sydney's Eastern suburbs. Manuel relied on Loren and acted on his advice. In July 2019, he borrowed $2,500,000 from Ripoff Credit, a small credit union that provided a loan and overdraft facilities. Manuel then signed five three-year leases, bought hairdressing equipment, employed two international celebrity hairstylists, and hired Tracey's Designs & Graphics to design a webpage for his growing business. Then things went sour and financial tragedy stroke. Loren admitted that she had not adequately factored in Manuel's pre-existing debts, had underestimated the significant establishment costs associated with setting up businesses in Sydney's Eastern suburbs. Loren explained to Manuel that in addition to reviewing his financial position, she also consulted her tarot cards on the matter and the reading showed that Manuel's business would reach financial glory. Manuel has suffered great losses as a result of this advice and is unable to pay Ripoff Credit. Advise Manuel on any rights and liabilities arising from these facts, citing relevant statutory and case law authority, using the ILAC format of legal problem solving.