Jamie, Harrison and Raine are good friends and decided to start an online shopping website -JHRFashions.com (JHRF) - to sell second-hand designer clothing. They agreed to divide the profit equally amongst themselves. Jamies girlfriend Emma has signed an agreement with JHRF to help the start-up with $100,000 on the condition that JHRF would repay her out of the profits for the next five years. The friends decide that as Jamie and Harrison have an IT background, they will look into the technical side of developing the software and running the website. Raine, a fashion designer by profession, will buy second-hand designer clothing from selected suppliers in Melbourne. However, he is only authorised to buy clothing for up to $10,000 in each transaction.

During the Easter holidays, Jamie visits his sister, Katie, who owns a designer clothing shop near Sydney harbour. Katie shows Jamie an overstock of designer handbags and shoes in her shop and says to him, look, these shoes and handbags are new and in fashion. As they are overstock, I will give it to you at the cost price of $30,000, only because you are my little brother. When the stock and invoice arrive, Harrison, Raine and Emma are furious that Jamie did not consult them before buying. They refuse to pay the invoice. Raine, who knows fashion, thinks that the shoes and handbags are not fashionable and online shoppers visiting JHRFashion.com will not be interested in buying them.

A few weeks later, Harrison suffers an acute lung infection and dies. Other partners decide that they will provide Harrisons widow, Jill, a portion of the profits made in the business every year by way of annuity.

At around the same time, Ashton, a regular customer of JHRFashion.com, buys a Kucci shirt. After wearing the shirt, he suffers from severe itchiness in the skin (clothing dermatitis) and cannot work for several weeks. Tests show that dermatitis has been caused by dyes used in making of Kucci shirts. The supplier of Kucci shirts had asked Raine to wash them to remove any chemicals or dyes before selling to customers. However, Raine forgot to follow the directions. Ashton sues Jamie, Jill, Raine and Emma, seeking damages to cover the medical expenses, lost wages and pain and suffering.

Please refer to relevant sections of the legislation and appropriate cases to support your arguments when answering the questions below.

Answer the following questions:

Can we say that there was a partnership between Jamie, Harrison, Raine and Emma when they started the business (JHRFashions)? Please give reasons for your answer. [3 marks]

Assuming only that a partnership exists, who is liable to pay for the $30,000 invoice? [ 5marks]

Does Jill become a partner in JHRFashions after the death of Harrison? [2 marks]

Raine has no money or assets. Advise Ashton whether he can successfully sue (jointly/severally) Jamie, Emma or Jill. [5 marks]