Trev is a furniture restorer. He has a workshop in an industrial complex on the

outskirts of Victor Harbour. Trev has been working in the area for 20 years and is

well known as a skilled craftsman. His wife, Victoria works part time in sales for the

local spa and swimming pool supplier and is skilled at general office work,

bookkeeping and the use of computers. Victoria spends some other time each week

COMMLAW 2500 Commercial Law II

Take-Home Class Test

working at the workshop performing general office duties, bookkeeping, preparing the

Business Activity Statement (BAS) return for the Tax Office and meeting with

business's accountant. Trev and Victoria have one adult son, Zenon who still lives at

home. Zenon attends University where he studies Engineering Drawing and Computer

Aided Design. Zenon helps Trev during University breaks and on weekends when the

workshop is particularly busy.

Trev's brother Wayne, has been working with Trev full time for the last three years.

When Wayne first started working with Trev he brought his own band saw, hand

tools, brushes and mitre gauges. Trev splits the income from the business evenly with

Wayne. Wayne contributes to costs such as electricity, water and rent. There is no

documentation which formally recognises any contributions or rules of the business.

One Saturday morning, Trev asks Zenon to find out how much it would cost to buy

new band saws for the business as Trev is very busy trying to complete some jobs

before the holidays. Zenon thinks that it would be good for the business to replace all

three existing band saws. Accordingly, he orders three Hafco Woodmaster W955

bandsaws at $799 each from Machinery House Pty Ltd for immediate delivery.

Driving to work last December, Wayne suffered a brain aneurism and was

hospitalised for several months. It now appears that he will no longer be able to work

as a furniture restorer.

Last Friday, Gladys, a long-time customer of the business, went to sit on her newly

restored Miner's Couch and one end completely collapsed causing her to fall heavily

and break her hip. She is in hospital for a replacement hip operation and has instructed

her lawyers that she wishes to sue.

Answer ALL of the following questions:

a. Is this business a partnership? If so, who are the partners in the partnership?

Use the Partnership Act and case law to support your argument (5 marks)

b. If Wayne is a partner what is to happen with his interest now that he cannot

participate?

Use the Partnership Act and case law to support your argument (5 marks)

c. Is the partnership liable to pay for the three bandsaws ordered by Zenon?

Use the Partnership Act and case law to support your argument (5 marks)

d. Who should Gladys sue? Can Wayne be included in the suit?

Use the Partnership Act and case law to support your argument (5 marks)