Question 1 (estimated time: 55 mins)
Sam, John and Rob are experienced plastic surgeons who operate a very successful surgery in partnership known as Snip Tuck. Each partner initially contributed the same amount of capital to the partnership. The partnership agreement does not make any mention of expulsion powers, profit sharing, dissolution or duration of the partnership. They have an excellent reputation in the industry, so much so that television personalities, leading musicians and wealthy entrepreneurs travel from overseas and interstate to be operated on by the surgeons. The partners orally agreed to purchase a new laser machine for the surgery from LaserBod Pty Ltd (who the partnership had regular previous dealings with).
There was a misunderstanding about which laser machine the partners agreed to purchase. Sam, using the partnership account, ordered a $100,000 “buttocks” laser machine on credit from LaserBod Pty Ltd. Rob and John are certain that the agreement was to purchase the “hips and thighs” laser machine.
Things then turn nasty. Whilst Sam is in his office discussing surgery options with a famous Australian actress, Rob confronts Sam about his “stuff up” with ordering the machine. “You’re a hopeless surgeon!” shouts Rob. In retaliation, Sam picks up a silicon implant on his desk and throws it at Rob, hitting him in the head. Rob then orders two security guards to escort Sam from the surgery. Sam is refused entry back into the premises. Two days later, Sam sells his interest in the partnership to Pat. John and Rob refuse to pay for the laser machine.
(a) Advise the partners of Snip Tuck as to whether they are liable to pay LaserBod
(b) John no longer wishes to be in a partnership with Sam. Advise John what he can do under the Partnership Act 1891 (Qld)
Continuing from the above facts, the partnership is dissolved. After partnership property is sold, there remains $210,000 in unpaid debts. John has $80,000 in personal...