8.

After inheriting a large sum of money Ade decided to indulge his passion for swimming and entered into a contract with Bath Ltd to construct an outdoor swimming pool in the garden of his house. The pool was to be 25 meters long by 10 meters wide by 2 meters deep, and was to be cleaned by a special non-chlorine based filter system. The pool was due to be finished in March and Ade entered into another contract with Colin to landscape his garden starting on 1 May. Bath Ltd finished the pool on 15 March. However, when Ade came to try it for the first time he found that it was only1·80 meters deep. In addition, Bath Ltd had not installed the non-chlorine filter system but had instead used an ordinary chlorine based system. As a result, Ade, who unknown to Bath Ltd was highly allergic to chlorine, suffered severe reaction and had to take a week off his work and as a result lost a potentially lucrative contract. On 1 April, Colin informed Ade that he was too busy to do his garden and that he would have to get someone else to do it. The only person available, however, will charge Ade £500 more than Colin agreed for doing the work.

Required: Analyses the scenario from the perspective of the law of contract, advising Ade: (a) Whether he can require Bath Ltd to reconstruct the swimming pool in order to make it the agreed depth, and if not, what alternative action is available to him? (4 marks) (b) What, if any, action can he take against Bath Ltd as a consequence of their failure to fit the chlorine free filter? (4 marks) (c) Whether he can require Colin to undertake the work on the garden, and if not, what alternative action is available to him? (2 marks) (10 marks)

9. Three years ago Norm, a wealthy retired accountant, agreed to become a director of his son Owen’s company, Push Ltd, which had been established three years previously. Owen told Norm that he only wanted his name amongst the directors in order to give Push Ltd increased credibility. Norm never actually took part in the management of the company and never attended any company meetings. Norm has now learned that Push Ltd is insolvent and owes considerable debts. Owen has confessed to

000 to both Philip and Givet. who had dealt with the partnership for some five years. Required: Advise Norm in regard to the following: (a) the common law duty of care owed by directors to their companies. The first one was with a longstanding customer Philip.213 of the Insolvency Act1986. Adam. Unfortunately the business assets will only cover the first £85. The second contract was with a new customer Givet.214 of the Insolvency Act 1986. (4 marks) (10 marks) 10. (10 marks) . (3 marks) (b) any potential liability on behalf of himself or Owen for fraudulent trading under s. Both believed that Chris was still a partner in the business. Required: Explain the potential liabilities of Clare. Last year Chris an retired from the partnership.000. and Eve for the partnership debts. Chris and Jones formed a partnership 10 years ago. Dan. although Adam was a sleeping partner and never had anything to do with running the business.000 to £300. (3 marks) (c) any potential liability of himself or Owen for wrongful trading under s.Norm that he had deliberately hidden the fact that Push Ltd has been insolvent and carried on trading for the past two years. in which time Push Ltd’s debts have increased from £50. Both contracts have gone badly wrong leaving the partnership owing £85.000 of the debt. Jones has subsequently entered into two large contracts.

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