Re Meeband Case Study

Question One

Introduction

Nowadays, trading between people and country become easier and easier. With the boom of economic, a consideration of starting a new business is very important. Common business structures including Sole Trader, Partnership, Joint Venture, and Corporations. Among those structures, partnership and corporations are the most popular structures for creating a business. This essay will discuss all of them point by point.

Cost-Effective

When we say that partnership is easy to establish, the first thing comes out is that partnership doesn 't need to be registered. Which means partners don 't need to fill paper works, or spend money on legal formalities. There is one exception, if the partnership use a business name, then

Re Ruddock (1879) indicate that “ to determine the real nature of the business relationship the court will look at the agreement itself, the parties itself, the whole course of the dealings between the parties”. Compare with Re Megeband case, both of cases are sharing the profits equally. But the difference is that in Re Megeband case, there was a loss sharing agreement while in this case they did not mention of losses. It’s hard to determine that if there is a partnership between Adrian, Bob and Charlotte, Dennis. However, according to Buckingham case, if there are more characters like partnership than not a partnership, it should be a partnership. Basis the analysis on step 2, it’s more likely be a partnership between Adrian, Bob and Charlotte, Dennis.

Default Rules as to Interests and Duties as Partners:

Section 24(1)(a) indicate that “Partners share equally in capital and profits and must contribute equally to losses”, Adrian, Bob,Charlotte and Dennis agree that they would share profits equally, but they didn’t mention about the loss. Therefore, all of them four will share the losses equally. Section (1) (e) gives all parties the right to management the business. Thus, even Adrian, Bob,Charlotte and Dennis are taking charge for different section of the business, all of them are decision makers. However, any