Trixie and Katya have been friends since $2007.$ They decide to join their talents and open a party planning business. Katya gets the necessary documents together and submits them to the CIPC. The proposed name of the company is YouStay $($Pty$)$ Ltd$.$ The Trixie and Katya will be the only two directors of the company.

Trixie becomes aware of an opportunity to purchase items that will help them get their business going. The items are being sold by Michelle, who is retiring from the business. The items for sale include chairs, tables and linen. She and Katya discuss it and agree that they will ask Ru to purchase these items in the name of their party planning company. Ru agrees to do this.

Ru and Michelle enter into the following contract:

Contract for purchase of furniture and linen

It is hereby agreed that Michelle will sell furniture and linen to the value of R$150000$ to YouStay $($Pty$)$ Ltd which is not yet incorporated. In the event that the company is not incorporated, Ru agrees to pay the R$150000$ to Michelle and take delivery of the furniture and linen.

Signed

Ru $1$ April $2023$

$($on behalf of YouStay $($Pty$)$ Ltd$)$

Michelle $1$ April $2023$

Answer the following questions:

$1.$ Is this a valid pre$-$incorporation contract? Motivate your answer. $(5)$

$2.$ The company is incorporated on $5$ April $2023.$ Trixie realises that the R$150000$ they agreed to pay is way too much. She and Katya therefore decide to reject the contract entered into by Ru and Michelle.

Who is liable to pay the R$150000?(3)$

$3.$ Before they rejected the contract, Michelle had actually delivered the furniture and linen to Trixie and Katya, who have been using the items for their business. They are refusing to pay R$150000,$ as they have rejected the contract. Ru is very unhappy about this.

Advise Ru whether there is anything she can do against Trixie and Katya in these circumstances. $(5)(13)$