You are to assume that you are a junior associate working in a law firm and one of the senior partners has asked you to research and provide legal advice in the form of memorandum of advice  in relation to a client that they have interviewed. read the fact scenario below and then answer the question/s asked of you. 

 

To:       Junior Associate

From: M.Ng@legallyprofessional.au

Subject: Client: Kevin Lidcombe

 

Hi Junior Associate,

I’ve just been on the phone to a new client. His name is Kevin, and he wants to see a lawyer for legal advice. I’ve made an appointment for tomorrow but prior to that I need you to do some research on the matter for me as I am stretched for time.

Here are some notes I managed to take down on my telephone conference call with Kevin this morning:

Kevin is a 32-year-old baker and up until recently he lived with his elderly parents. He is still grieving their loss as both passed away within 2 weeks of each other late last year. He thought his luck had changed three months ago when Michaela, a woman he has always had strong feelings for, said that she would move in with him. Kevin has inherited his parents Brighton home and all their savings so when Michaela said that she too had feelings for him and needed a place to live, Kevin believed that it was love and that they would live happily ever after. Kevin has cystic fibrosis which affects his lungs. He can manage the disease but felt vulnerable when his parents passed away as they always took care of him. He said that he cannot thank Michaela enough as she now helps him with all his medical appointments, medications and even helps him organise his finances.

Kevin has advised that Michaela is a fashion designer. He has loved her since the day he met her when they were only 18, but Michaela has always said that she did not feel the same way. Kevin said that he has never had a girlfriend because his heart was always with Michaela and he had always told her that he would “wait for her.” 

 

Kevin said that not long after Michaela moved in with him, she told him about a new idea she had for her fashion business. She had an idea for a new fabric for bathers that will dry almost immediately when a swimmer gets out of the water. She wanted to make stylish bathers with this new fabric, but she needed funds for the equipment to make a prototype and import the fabric from overseas. Kevin said that Michaela told him that she had struggled financially for a few years and does not have a good credit rating, and because of this the bank has rejected her last two attempts for a loan unless she has a guarantor who would be willing to put up $1 million as a guarantee. He said that she asked whether he would consider putting up his parents’ home, of which he is now the title owner, as guarantee for her loan.

Kevin said that Michaela told him that her idea and the new bathers would make her millions and it would be enough money to look after them both for the rest of their lives. He said that she even told him she would pay for a big wedding for them once she made money on this idea. Kevin said that he was hesitant to use his parents’ home as guarantee but that he trusted Michaela, so he signed it. He said that a man from the bank (Star Right Bank) attended his home. His name was Trent and he was also a good friend of Michaela’s. Trent told Kevin that the guarantee was nothing to worry about and he should have faith in Michaela because this is a great idea. Kevin signed the contract with Star Right Bank and became guarantor for Michaela’s loan for $1 million.

Kevin is distraught and currently seeking medical help for severe anxiety and depression. He has advised that Michaela’s spent a heap of money on the new fabric, equipment, and marketing for her new idea, but the idea didn’t work out. Last week he received a letter from the bank advising him that they were going to enforce the guarantee for $1 million dollars. He also said that Michaela had left him and told him that she no longer has feelings for him and that she is in love with Trent from the bank.

Kevin is also concerned over the sale of his parent’s old car which he was trying to sell to give Michaela some extra cash to kick off her new idea. He said that he placed an advertisement in the local newspaper on 1 May to sell his parent’s BMW for $10,000. He got a telephone call from a woman called Janice Johnson on 3 May who asked if she could purchase the car for $9500. Kevin says that he accepted that price but told Janice that she must pay the money and pick the car up by 10 May or he will sell it to somebody else. Janice replied, “No worries – see you on the 10^th”. Today is 12 May and Kevin has not heard from Janice. He says that he no longer wants to sell the car because Michaela has left him.

Kevin is coming in for an appointment tomorrow, so I urgently need you to draft a memo of advice.

 

Kevin wants to know about the strengths and weaknesses of his case and what his chances are if he should proceed with litigation. In your memo of advice, could you therefore please address the following:

1. If we proceed to litigation, critically consider Kevin’s legal options in relation to Star Right Bank pursuant to both common law and statutory law. I will need to know all relevant case law and legislation so please refer to this in your argumentation.

2. Critically consider what Kevin’s legal rights are in terms of the car? I will need to know all relevant case law and legislation.