Nir and John run a small florist shop called Flower Paradise. Nir does not take an active role in the day-to-day management of the florist shop and so Nir and John have agreed that Nir will only receive 30 per cent of the profits while John will receive 70 per cent. They have also agreed that Nir will only be liable for 30 per cent of the costs of the business. No one but Nir and John is aware of this arrangement. After some success, the business has suddenly failed and closed down. John has withdrawn all the cash from the Bank and gone to Italy. Before leaving, John also borrowed $10,000 from a finance company, Quick Loans Ltd, at very high interest rates. John told Quick Loans Ltd that he was authorised by Flower Paradise to borrow the money for the purpose of expanding the business. This was not true. However, John borrowed money on two earlier occasions which were duly paid back from Flower Paradises account. The money disappeared along with John. Quick Loans Ltd now wants Nir to repay the $10,000. Nir claims that he is not responsible as the money was used for Johns own purposes. Alternatively, Nir claims that, if he is liable, his liability is limited to $3,000 (that is 30 per cent of the loan amount).

Required:

Discuss whether the Flower Paradise can be considered as a partnership business. Advise whether Nir is liable to Quick Loans Ltd; and, if he is, how much he must pay to Quick Loans Ltd. You should support your answer with reference to relevant sections of the Partnership Act and, where relevant, to cases laws.

Hey legend need this ASAP!!

Will like and comment for genuine answers! Thank you