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Mr Barry organises the goods to be delivered to the new companys (Cheap Roofs Pty Ltd) premises without informing Mrs Luke. Cheap Roofs Pty Ltd undertake several jobs in Bali and returns a profit of $1.5m. In addition to this Cheap Roofs Pty Ltd commences tendering for contracts that would usually have been won by No.1 in Roofs Pty Ltd.
Steel4u Pty Ltd requests No.1 in Roofs Pty Ltd pay the outstanding contract of $2.5m. Mrs Luke, responsible for the accounts payable, responds to Steel4u Pty Ltd saying No.1 in Roofs Pty Ltd has no record of these goods and will not be paying the outstanding account.
Problem Based question
1. Explain whether Steel4u Pty Ltd can enforce the contract against No.1 Roofs Pty Ltd. Consider whether it can rely on the assumptions in s129 of the Corporations Act. and whether an exception to the assumption by way of s128(4) is applicable. Refer to case law to explain your conclusion.
2. Briefly discuss whether Mr Barry has breached any director duties in establishing the new company and approaching clients.
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