CS 4: Elements plc is the parent company in a group of companies operating in the production and distribution of water-sports equipment in the United Kingdom.

Elements plc holds the majority of shares in Aqua Ltd, which supplies the watersports equipment to local sellers. The remaining shares are held by two directors of Aqua Ltd, both of whom were appointed by Elements plc.

Swimmers Ltd is one Aqua Ltd's major suppliers and creditors. It has been striving to obtain payment for deliveries supplied to Aqua Ltd. However, it has recently learnt that Aqua Ltd has ceased trading. Moreover, it seems that in the last five months, materials delivered to Aqua Ltd, and orders received by Aqua Ltd, were all passed on to Waterfalls Ltd. Waterfalls Ltd is a wholly-owned subsidiary of Elements plc, and was only recently incorporated.

With reference to the UK common law:

Advise Swimmers Ltd whether it can obtain payment from either Elements plc or Waterfalls Ltd in respect of the debts of Aqua Ltd.