(i) The extent to which the answer identifies relevant partnership law and company law issues and sets out sound reasoning in support of the discussion. (ii) The extent to which the answer demonstrates knowledge and understanding of relevant topics of partnership law and company law, including having references to relevant sections of the Partnership Act 1891 (SA), the Corporations Act 2001 (Cth) and applicable case law. (iii) Whether the answer is easy to read and understand. Students should use relevant headings and sub-headings to assist ease of reading. The headings and sub-headings do not count in the word-count. (iv) As Question 1 is a research question, you are expected to show evidence of greater reading and knowledge beyond the textbook, Course Readers, lecture slides and materials for the course. Page 2 of 4 QUESTION 1 (Candidates must answer both questions 1 and 2) Discuss the advantages and disadvantages of conducting a business using the business structures of a partnership and a corporation. As part of your answer, give examples of where using one of these structures would be preferable to the other structure. Explain your answer using relevant sections of legislation and relevant case law. (20 Marks) QUESTION 2 (Candidates must answer both questions 1 and 2) Bronte and Emily are music producers and huge fans of Justin Bieber and want to organise a tour to Adelaide by their favourite performer. They contact Justin and he is very excited about the opportunity to tour. Bronte and Emily want Justin to tour to Adelaide. They decide to call the tour the \"What Do You Mean? Tour\" and begin looking for suitable stadiums to hold the huge crowd that will attend each concert. Bronte and Emily approach the Adelaide Oval and explain that they are organising the \"What Do You Mean? Tour\". Bronte and Emily show the Adelaide Oval manager the plans for the huge temporary stage that they want built on the Adelaide Oval surface to hold the amazing music and light show Justin is famous for. The Adelaide Oval agrees to hold the concerts. Bronte and Emily have $50,000 each to run the Tour. The cost of building the temporary stage and use of the Adelaide Oval will be $100,000. Bronte, Emily, Justin Bieber and the Adelaide Oval enter into a \"What Do You Mean? Joint Venture Agreement\" which stated that: (i) Bronte and Emily would contribute $50,000 each, the Adelaide Oval would allow the use of the Oval and build the temporary stage and Justin Bieber would perform four concerts. (ii) The business name \"What Do You Mean? Tour\" would be jointly owned by all four parties. The Adelaide Oval would retain sole ownership of the Oval but would allow \"the Joint Venture\" to use the Oval at no cost. The Adelaide Oval would be the sole hirer (a hirer is someone who hires or rents equipment) of the temporary stage and again allow \"the Joint Venture\" to use it at no cost. (iii) Adelaide Oval staff would be responsible for building the stage and the Adelaide Oval would supply the ticket sellers, ground staff and security staff for the concert venue. Bronte and Emily would be responsible for the production of tour merchandise, the arrangements for flying Justin, his band and dancers to Adelaide and the accommodation. QUESTION CONTINUED ON NEXT PAGE Page 3 of 4 (iv) All decisions relating to the Joint Venture would be made by Bronte, Emily, Justin and the Adelaide Oval together. The Adelaide Oval was appointed \"as agent\" for the Joint Venture to build the stage and to maintain safety of the stage and the concert venue. The safety of the stage and venue was the sole responsibility of the Adelaide Oval. (v) The four parties would share profits equally but there was no mention of losses. (vi) Justin, who owned the copyright in the words and music of the songs (including the right to perform the songs), would transfer ownership of the copyright \"to the Joint Venture\" so that all the parties would hold the copyright equally. (vii) The Adelaide Oval would provide a \"loan\" of $100,000 \"to the Joint Venture\" to cover building the stage and the use of the venue. The loan was to be repaid in full out of the profits of the sales of tickets and merchandise before any profits would be distributed to the four parties. Explain whether or not the above facts give rise to a partnership and, if so, who are the partners? As part of your answer, refer to relevant sections and rules of the Partnership Act and relevant case law. Note: use the Partnership Act and case law to identify the arguments in favour of a partnership existing and the arguments against. assess the strengths and weaknesses of these arguments and identify which they believe to be stronger or weaker and their view of the likely outcome. (10 Marks) Running Head; Partnership 1 Insert Student's Name; Insert Name of the Institution; Insert Date of Submission; 2 There are various advantages and disadvantages that come along with using business structure that incorporates a partnership and a corporation structure. The advantages of a corporation are a number in relation to a partnership. A partnership has a restricted number of members that could join the partnership. The law has outlined that for a new partner to join a partnership business and they were not there at the initial forming of the partnership, the partnership has to be dissolved and the new members get their details taken to the registrar, this is in accordance to the Partnership act 1891. On the other hand a corporation has no restriction in terms of anyone joining the company. This can easily be done through the stock exchange market that is through the sale of shares and one gets to own part of the company. The corporations have a large source of raising funds in comparison to the partnership; this is due to the numerous avenues that are created such as selling shares of the company which the partnership is limited to[Leg171]. The funds to run the partnership have to be sourced and raised by the partners themselves without interference from outsiders unless the partnership gets from financial institutions[ELa17]. In addition to the advantages of a corporation, it has a continuous life. The company can operate for as long it is suitable and it is making profits. The numbers of shareholders in the company are not limited and the company can as well as forms other subsidiaries and also merge in its lifetime. This has given companies the big advantage over partnerships, since for the partnerships they get dissolved once they attain their objective as set out in the partnership agreement. On the other hand, a partnership has the advantage over a corporation since it requires less funds to start a partnership in comparison to a corporation. The registrar of companies has set out the 3 least amount that a company can start over with which is much less compared to a partnership. This has made it much easier and quicker to establish a partnership. More to that is that a partnership has a specific objective which is outlined in their partnership agreement, this becomes an advantage in the sense that they can easily get to raise funds from the banks and other money lending services since their objectives and the reasons as to why the funds are being accessed have been outlined and highlighted by the agreement. However, unlike the corporations they can get to use the funds that they have accessed for other reasons which are not outlined in the company's objective clause. In conclusion, a partnership can get to use the expertise that other partners have instead of having to outsource for the skilled labor. This will get to save the business the operation costs and the consultation charges that they would have to use on the business. Unlike a corporation due to the large scale of operation, the company is needed to have the highly skilled labor which is going to advise and guide the company on the right steps to take in order to achieve their desired objective. However, in the case of having a skilled member handle the affairs of the partnership they will be held liable for the mistakes they commit as was outlined in the case of Polkinghorne vs Holland where by one of the members was charged for being misrepresentation. More to this the investment by a partner will be used in paying for the debt. In reference to the partnership between Emily, Borne, Justin and Adelaide Oval have met the needed requirements to form a partnership, the fact that the Emily and Borne agreed to partner with Justin Bieber and Adelaide Oval to form the \"What Do You Mean Tour\" which was formed due to the huge fan base that Justin Bieber gets to enjoy from his Australian fans. The fact that they got to form a tour for Justin this is an indication that the partnership had an objective which 4 is very key requirement in forming a partnership, the aspect of having defined the number of members into the partnership has also been satisfied, the share capital and the input by each member has been set out by the members, the duration in which the partnership is going to last has been indicated by the members. The objective and the features needed in forming a partnership have been met by the members who have indicated that they are ready by the requirements outlined. The aspect that they have not indicated on how they will sharing the costs however does invalidate the partnership since incase of a disagreement the parties will uphold the regulations outline in the partnership act of 1981[Att17]. The weakness of the partnership is that the partners that are Justin, Bronte, Emily and Adelaide Oval they did not indicate for how long the partnership will be running despite Adelaide having to construct the performance stage for Justin. The likely outcome of the partnership is that they will be able to organize the event despite having to walk on a tight rope in the case that they get to deal with loses from the events. In the event that they get to make loses they will have to use the partnership act in order to resolve the issues and the problems that might arise. REFERENCES; 5 Department, A. G. (n.d.). Government of South Australia . Retrieved September 08, 2017, from Government of South Australia : https://www.legislation.sa.gov.au/LZ/C/A/PARTNERSHIP%20ACT %201891.aspx E-Law. (n.d.). E-Law . Retrieved September 08, 2017, from E-Law : https://www.elaw.bc.ca/art_corpstructure.html Legalzoom. (2017). Legalzoom . Retrieved September 08, 2017, from Legalzoom: https://www.legalzoom.com/knowledge/corporation/topic/sole-proprietor-corporationpartnership-comparison