Hi there, I need help answering this case scenario before my lectures next week.

Jim and Layla have been friends since they studied together at the University's Business School. In 2009, they formed a partnership to provide accounting and business advisory services to small Auckland businesses. They each contributed $50,000 in cash and agreed to share the profits equally. Their business grew steadily over the following 10 years and by 2019, the partnership was worth $1,500,000. Jim and Layla know this because Jim had the business valued so he could borrow $500,000 from the bank to buy a new family home in October 2019. To approve the lending, the bank needed to know what assets and liabilities Jim had.

By January 2020, the partnership employed 12 staff, including senior accountant Bambi and office manager Solomon. The March-April 2020 lockdowns were an extremely busy time for the partnership as the staff (Bambi in particular) worked tirelessly to support their stressed clients. When they were back in the office, in August of 2020, Bambi started asking Jim and Layla about becoming a partner of the firm.

Bambi is aware of what the partnership was valued at in 2019. She does not have much money to buy into the partnership, as she is desperately saving to buy a house. However, she is prepared to risk only $100,000. Jim is very excited about growing the firm and Layla is excited about an injection of funds into the partnership. Jim and Layla agree to dissolve the existing partnership enter into a new partnership with Bambi whereby Bambi would risk no more $100,000.

Shortly after the new partnership agreement was signed, Solomon developed concerns regarding the firms finances. One day while he was transferring money between accounts to pay the upcoming wages bill, he realised the savings account was almost empty!

Layla admits to Solomon her interest in online gambling had become an addiction for her during the lockdown. She breaks down saying I have lost my life savings and even my house!

Layla then confesses that she has been withdrawing money from the partnerships accounts to gamble, in an attempt to recover her lost money. Bambi and Jim are immediately informed of the problem.

Using your knowledge of partnership law, what does this crisis mean for Jim, Layla, Bambi and Solomon respectively?