This is company law subject

AN IMPORTANT NOTE: You should refer to relevant sections in legislations and case law when answering the following questions.

Question 5

Bridge Architects Ltd (Bridge) is a public company based in Sydney. It specialises in high-level modelling and drawing that is used for blueprint purposes for a variety of structures. To perform these functions, Bridge uses the MD 101 program from Model Draw, which is expensive but considered to be the premium software on the market. However, because the business started to slow down, John, the General Manager of Bridge, held discussions with Chris, the CEO of Model Draw and proposed that Bridge would like to become the exclusive distributor of Model Draws software in Australia in addition to Bridges architectural work. Last month, both businesses entered into an agreement entitled Contract for Exclusive Distributorship. The contract includes the following terms:

1. Bridge Architect Ltd (Bridge) is appointed as the distributor by Model Draw and granted exclusive distribution rights of Model Draws software during the term of this agreement.

2. Bridge and Model Draw are not partners and do not intend to be partners.

3. Bridge hereby assigns to Model Draw one-third of its interest in the distribution business, including the right to receive one-third of Bridges profits from the business.

4. Bridge shall keep Model Draw informed as to the affairs of Bridge and shall consult with Model Draw before taking any major decisions concerning the business.

5. To avoid any conflict of interest, Bridge shall not transact with any competitor to Model Draws business and shall not enter into any distribution agreement with any similar software business. The contract has proved to be beneficial for both businesses and Model Draw has received considerable profits from it. However, Model Draw received some anonymous information recently that Bridge leaked Model Draws trade secrets in relation to the design of algorithms in the software to a generative artificial intelligence company called Hyperion under a secret deal for which Bridge would receive a considerable amount of money. Chris became furious after learning about this leak and immediately called John to inform him that Model Draw would like to commence legal action against Bridge.

Answer the following questions by referring to relevant statutory provisions under the Partnership Act 1892 (NSW) and case laws,

a) Explain whether there is a partnership between Bridge and Model Draw in relation to the distribution business.

(b) Explain whether Model Draw can bring action against Bridge for a breach of Bridges duties as a partner?