LSBF Business Law Project Assignment
Bagwell Office Renovation & Bagwell, Scofield & Franklin Partnership
Scofield asked Burrows, a contractor to do the following renovations for his new office:
(i) to paint the wall
(ii) to lay marble tiles for the floor and
(iii) to install a multi-spilt air conditioning system
Taking into consideration the labour charges, the total cost of the renovation came to $100,000. Scofield paid a 25% deposit to Burrows for the renovation package.
At the end of the three weeks when the renovation was over and before Scofield had made the remainder payment to Burrows, Scofield realised that the air-conditioning the unit was not cooling most of the rooms effectively and that some of the marble titles seem to be cracked and discoloured. The paint job on the wall seems fine except that kind of paint Scofield specified to Burrows was a better quality Nippon paint.
However, Burrows had used a cheaper type of paint from Taiwan. This Scofield came to find out when he saw the discarded paint container left to be disposed of after the renovation. Scofield felt that the work done by Burrows was unsatisfactory and as such he refused to pay him the remaining sum of money outstanding. Burrows threatened that he will sue if does not get what was due to him.
In meantime, Scofield was a senior partner in a firm dealing with bird’s nest soup. The partnership consists of two other persons, Bagwell and Franklin. The firm has been making a steady profit and the partners realised in order to meet the demands of the customers there was a need to upgrade the computer system to help them track customers’ orders.
It was decided that as Bagwell had superior knowledge, Bagwell will be allowed to purchase the computer. The next day, Bagwell went to Sim Lim Square and as he was shopping around for an appropriate computer system that would meet the firm’s needs, he bumped into Malone, who was Bagwell’s brother-in-law. Bagwell realised that Malone had a shop specialised in selling high-end computers. Bagwell told Malone that he was looking for a good computer system and Malone asked him to check out the models that he had in his shop.
In particular, Malone recommended a specific computer model which he said was ideal for small businesses. This system cost $ 7000 and it came with a five-year warranty and an all-in-one scanner, copier and printer. At first, Bagwell was apprehensive as the price tag for the model was way above what he was authorised to purchase.
However, Malone pointed out to Bagwell that if he was looking at one within the price range of $ 5000 was not effective as the one recommended by Malone. In fact, Malone showed him another computer system that cost $ 4999 but was half efficient as the $ 7000 model. Convinced by this Bagwell agreed to purchase the $ 7000 model. Convinced 2 by this Bagwell agreed to purchase $ 7000 computer and told Malone that he should bring in the computer system the following day and set it up in his office.
As the day was coming to a close, Malone decided to close the shop and invited Bagwell for a drink as he had not seen his brother-in-law for a long time. Both of them decided to go to a Karaoke Lounge where Malone ordered a bottle of Remy Martin XO Cognac. During the bout of singing some karaoke classics, Malone inquired after Bagwell’s wife who was his sister.
Bagwell said she was expecting and the baby was due in a couple of months. Malone was extremely pleased with this information and when they decided to go home Malone thrust into Bagwell’s hand a small envelope which he said was a small gift from him for Bagwell’s new addition to the family. Initially, Bagwell refused but later he accepted the envelope which contained $ 500. The following day, Scofield was discussing the possibility of converting their partnership into a limited liability company.
Bagwell had called in earlier stating that he was taking a day’s leave as he had a terrible hangover. Whilst Scofield and Franklin were in the midst of their discussions, Malone came in with the new computer system and spent two hours setting it up. In the end, he passed the invoice to Scofield who had rude shocked that the computer cost $ 7000. Both Scofield and Franklin were upset with the price of the computer and refused to pay for it. They told Malone that he could jolly well unhook the system and take it back. Malone said that the system was already sold to them and as such, they had to pay for it.
When Scofield told him that he had not given Bagwell permission to purchase a computer at that price, Malone said this was not his concern. He also told Scofield and Franklin that because Bagwell was his brother-in-law, they got the computer system cheap at that price. Both Scofield and Franklin also came to realise what happened between Malone and Bagwell the day before. They were naturally upset with Bagwell’s action.
Case Study Assignment
1 What are the legal issues that could be raised in both case studies?
2 Advise each of the parties in both of the cases what are the actions they could take to redress the actions done to them.
3 Quote relevant cases in your answers.
Case 1
1 Overall what is the areas of focus: renovation of office and SGA
2 Focus on each individual area
(a) painting of wall / laying marble tiles floor
– what was the specification?
– what was the end product?
– what areas of law are involved?
– what are the evidence?
– what cases are relevant?
(b) – what are causes of action can Bagwell can take to rectify the workmanship
(c) What cause of action has Burrows has against Bagwell for refusing to pay for work already done?
Case 2
1. Overall what is the areas of focus: partnership and power of partner in awarding the contract to a related person and the possibility of converting partnership to limited liability company
2. Business dealings Between Bagwell & Malone
– What was Bagwell’s authority in committing funds for the new computer system?
– Did he have to consult Franklin & Scofield in incurring an additional $2,000 for the computer system?
– Was there any wrong in Bagwell awarding the computer system to Malone who is his brother-in-law?
-Was Bagwell wrong in accepting the lunch and $500 gift for his unborn child from Malone?
Quote the relevant law and cases.
3. Dealings between Malone & Franklin and Burrows
– Can Franklin & Scofield reject the computer systems bought by Bagwell?
– Can they ask Malone to take out the system installed?
3. Dealings between Malone & Franklin and Burrows
– What cause of action has Malone against the partnership for rejecting the computer system it has purchased?
4. Discussion between Franklin and Scofield on the conversion of the Partnership to Limited Liability Company.
– Should Franklin and Scofield included Bagwell in the discussion?
– What are the advantages and disadvantages of conversion from a partnership to a Limited Liability company?
