QUESTION 1 (10.5 MARKS) Sarah, Jane and Ziela were partners of an engineering firm. The firm was managed by Sarah while Jane and Ziela contributed capital only and shared in the profit distribution. A year ago, Sarah bought a piece of land using the firm's money to set up a laboratory to run the firm's research project. Sarah hired Aidi & Associates to complete the construction of the laboratory within 3 years with a construction cost of RM250,000. Payment would be made in stages according to the progress of the project. Five months ago, Sarah retired as a partner when she sold all of her shares in the firm to Jimi and he was accepted as a new partner. Recently, Aidi & Associates demanded all the partners including Jimi to settle the progress payment of the laboratory construction project which had been 30% complete but failed to be paid by the firm. Sarah denied liability on the ground that she was no longer a partner while Jimi refused to be liable on the ground that he was yet a partner when the laboratory construction contract was entered into and was not involved in the matter. Determine whether Sarah's and Jimi's assertions are true. Discuss as well the partner's liabilities under the contract. Support your answer with three (3) statutory provisions and two (2) case authorities

Q2.

Kimi, Reena, Lina and Lim have set up a limited liability partnership called 'Kremil and Partners LLP' (firm). Their firm runs the business of selling electrical goods and computer hardware. According to the partnership agreement, Kimi is responsible to manage the firm's finances, Reena is responsible to order the goods for the business while Lina is responsible for customer's orders. Lim, on the other hand, only contributes towards the capital and does not participate in the administration of the firm. One day, Lim ordered on credit 200 units of electrical goods and 100 units of computer hardware worth RM250,000 from EPCOM Sdn. Bhd. However, the claim for payment made by EPCOM Sdn. Bhd. was rejected by all the other partners who did not agree to make the payment. EPCOM Sdn. Bhd. intends to sue the firm and all the partners. Discuss the claim by EPCOM Sdn. Bhd. and the liabilities of the firm and its partners in connection with the claim. Support your answer with two (2) statutory provisions.