Discuss and evaluate the difference between a sole proprietor and partnership based on this case study:

Case Study

JBS PTY Ltd v CIMC MBS Ltd (formerly Verbus Systems Ltd) [2019] - making sure milestone payments are compliant with the Construction Act

In August, the Court of Appeal considered the relationship between milestone payments agreed between the parties and the requirements for a payment mechanism to be compliant with s109 and s110 of the Construction Act.

JBS was the main contractor for the construction of a new Windfarm Concrete bases. JBS entered into a sub-contract with CIMC to design, supply and install 78 steel frames and rebar . The sub-contract between the parties incorporated the JCT Design and Build Sub-Contract 2011 edition, but provision for interim payment was replaced by various milestones some of which were said to be "on sign-off", this was also agreed verbally by one of the directors for JBS whom passed away.

During the execution of works, the parties disagreed what "sign-off" meant.

In the Court of Appeal Chief Justice disagreed with the decision of the TCC and held that the contract did in fact contain adequate payment mechanisms. He concluded that an objective interpretation of "sign-off" meant when the units were done and in a condition where they could be signed off (that is, they complied with the contract specification). He rejected a subjective interpretation that payment was not due until the date sign-off actually occurred.

As part of the commercial agreement, JBS required CIMC to have bank guarantees , the court verdict changes the guarantee requirements, CIMC needs more bonds in order for contract to continue since JBS feels they won't have funds to meet milestones, this entails credit application with the Bank

Comparing Sole and Partnership :

We are the legal department giving advice to JBS, we should review the contract of CIMC

1. Directors responsible to sign the contracts, how many(minimum )directors must sign contracts .

2. How does Credit background affect contract agreements

3. How many directors can facilitate contract amendments

4. What happens to the contract if a director passes on compare the two types

5. Are bonds affected by type of company

6. How long it takes to register a company for either type

7. How does a criminal case against any director affect the contract

8. How does a marital status affect directors of the companies in case give an example how a divorce will affect the contract