The extent to which the answer identifies relevant partnership law and company law issues and sets out sound reasoning in support of the discussion.

(i)     The extent to which the answer identifies relevant partnership law and company law issues and sets out sound reasoning in support of the discussion.

(ii)     The extent to which the answer demonstrates knowledge and understanding of relevant topics of partnership law and company law, including having references to relevant sections of the Partnership Act 1891 (SA), the Corporations Act 2001 (Cth) and applicable case law.

(iii)    Whether the answer is easy to read and understand.  Students should use relevant headings and sub-headings to assist ease of reading.  The headings and sub-headings do not count in the word-count.

(iv)   As Question 1 is a research question, you are expected to show evidence of greater reading and knowledge beyond the textbook, Course Readers, lecture slides and materials for the course.






Page 2 of 4


(Candidates must answer both questions 1 and 2)



Discuss the advantages and disadvantages of conducting a business using the business structures of a partnership and a corporation.  As part of your answer, give examples of where using one of these structures would be preferable to the other structure.  Explain your answer using relevant sections of legislation and relevant case law.



(20 Marks)





(Candidates must answer both questions 1 and 2)



Bronte and Emily are music producers and huge fans of Justin Bieber and want to organise a tour to Adelaide by their favourite performer.  They contact Justin and he is very excited about the opportunity to tour.  Bronte and Emily want Justin to tour to Adelaide.  They decide to call the tour the “What Do You Mean? Tour” and begin looking for suitable stadiums to hold the huge crowd that will attend each concert.

Bronte and Emily approach the Adelaide Oval and explain that they are organising the “What Do You Mean? Tour”.   Bronte and Emily show the Adelaide Oval manager the plans for the huge temporary stage that they want built on the Adelaide Oval surface to hold the amazing music and light show Justin is famous for.  The Adelaide Oval agrees to hold the concerts.  Bronte and Emily have $50,000 each to run the Tour.   The cost of building the temporary stage and use of the Adelaide Oval will be $100,000.

Bronte, Emily, Justin Bieber and the Adelaide Oval enter into a “What Do You Mean? Joint Venture Agreement” which stated that:

(i)                   Bronte and Emily would contribute $50,000 each, the Adelaide Oval would allow the use of the Oval and build the temporary stage and Justin Bieber would perform four concerts.

(ii)                 The business name “What Do You Mean? Tour” would be jointly owned by all four parties.  The Adelaide Oval would retain sole ownership of the Oval but would allow “the Joint Venture” to use the Oval at no cost.  The Adelaide Oval would be the sole hirer (a hirer is someone who hires or rents equipment) of the temporary stage and again allow “the Joint Venture” to use it at no cost.

(iii)                Adelaide Oval staff would be responsible for building the stage and the Adelaide Oval would supply the ticket sellers, ground staff and security staff for the concert venue. Bronte and Emily would be responsible for the production of tour merchandise, the arrangements for flying Justin, his band and dancers to Adelaide and the accommodation.


Page 3 of 4

(iv)               All decisions relating to the Joint Venture would be made by Bronte, Emily, Justin and the Adelaide Oval together.  The Adelaide Oval was appointed “as agent” for the Joint Venture to build the stage and to maintain safety of the stage and the concert venue. The safety of the stage and venue was the sole responsibility of the Adelaide Oval.

(v)                 The four parties would share profits equally but there was no mention of losses.

(vi)               Justin, who owned the copyright in the words and music of the songs (including the right to perform the songs), would transfer ownership of the copyright “to the Joint Venture” so that all the parties would hold the copyright equally.

(vii)              The Adelaide Oval would provide a “loan” of $100,000 “to the Joint Venture” to cover building the stage and the use of the venue.  The loan was to be repaid in full out of the profits of the sales of tickets and merchandise before any profits would be distributed to the four parties.

Explain whether or not the above facts give rise to a partnership and, if so, who are the partners?  As part of your answer, refer to relevant sections and rules of the Partnership Act and relevant case law.

Note:  use the Partnership Act and case law to identify the arguments in favour of a partnership existing and the arguments against. assess the strengths and weaknesses of these arguments and identify which they believe to be stronger or weaker and their view of the likely outcome.