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Questions: Whether Ringo would be successful in recovering the claims of $6,000 as rent in arrear from Elena, or not? Whether or not Albert is under the obligation to pay the promised sum to George? Whether or not Albert has any remedies under the contract law? Which business structure is the most suitable for Harry, based on the facts given in the case study? Answers: 1.Misrepresentation is amongst one of the vitiating factors under a contract, the presence of which gives the aggrieved party an option to rescind the contract. In cases of misrepresentation, one party is induced or forced into getting into the contract and this allows the contract voidable at the option of the uncured party (Mulcahy, 2008). In Smith v Land and House Property Corp (1884) 28 Ch D 7, the claimant had purchased a hotel and one of the tenants had been described as being the most desirable one by the seller. This was done even when the seller was aware of the fact that the tenants rent was outstanding and that he was on the verge of being declared a bankrupt. The court held that this was a statement of fact and not a statement of opinion, owing to fact that the seller was in such a position to have known these facts (E-Law Resources, 2017a). In the case of Bisset v Wilkinson [1927] AC 177, the statement was made regarding the estimate that the land would carry two thousand sheep. Relying upon this statement, the land was purchased by the claimant and when this estimate turned wrong, an action for misrepresentation was brought to the court. The court held that this was not a statement of fact, but merely an opinion and so, the action for misrepresentation could not be upheld (E-Law Resources, 2017b). And as a case of fraudulent misrepresentation was found to be present in Car Universal Credit v Caldwell [1964] 2 WLR 600, Caldwell was allowed to rescind the contract (E-Law Resources, 2017c). Another crucial concept under the contract law is promissory estoppel. Promissory estoppel is a doctrine of estoppel, based on which, the individuals are estopped from going back on a promise made by them to another party, where the other party relied upon the promise which had been made. On the basis of this concept, an individual is stopped from making a u-turn on the promise which has not been supported by consideration (Blum, 2007). In order to show that a case of promissory estoppel is present, there is a need to show that there was a pre-existing contractual obligation which had been amended. This has to be coupled with the clarity in the unambiguous promise and a resulting change of position. Lastly, it has to be inequitable to permit the promisor to take back the promise which had been made (Helewitz, 2010). Central London Property Trust Ltd v High Trees House Ltd [1947] KB 130 or otherwise known as the High Trees case is the one where this concept was born as an obiter statement. In this case, the trust had given a block of flats on rent to High Trees for a sum of 2,500 as ground rent. Owing to the war time, the flats remained vacant and a decision was reached between the parties to reduce the rent by 50%. When the war got over, the trust asked for management of the full rent. This was allowed by the court (Atkins, 2015). However, Denning J did not stop here and stated in his obiter statement that in case the trust had applied for the full rent for the period from which it was reduced, instead of the full rent from the period when the war got over, the trust would have failed in their action. This was due to the reliance made by High Trees on the changed promise and the doctrine of promissory estoppel (Mitchell and Mitchell, 2008). Application In the given case study, Ringo approached Elena to see if she would be interested in getting his prime location store. In order to get her to lease the store, he stated that a range of brands had signed the long term lease and this included different high end fashion shops and even a cinema. On hearing this and the fact that Ringo would do the fitout for her, she decided to enter into a 5 year-lease at $3000 for each week. However, she later discovered that the claims made by Ringo were all false and that in reality no leases had been signed with big brand and that the cinema construction was delayed by a year. Based on these facts, she can make a claim of misrepresentation against Ringo. For this, the case of Smith v Land and House Property Corp proves helpful. Ringo was in a position to know that the cinema construction was delayed and that the leases with big brands had not been done. So, based on this case, Ringo would be guilty of misrepresentation. Also, when the facts of this case are compared to the case of Bisset v Wilkinson, it becomes clear that unlike the latter case, the statement here was of fact and not opinion. And so, on the basis of Car Universal Credit v Caldwell, Elena would be able to get the lease rescinded owing to the misrepresentation of Ringo. Ringo on hearing that Elena was considering the termination of lease claimed the reduced rent. However, he would not be successful owing to the principle of promissory estoppel. A promise had been made here to change the preexisting obligation. There was clarity to decrease the rent by $1,000 and this would result in changed position of both Ringo and Elena. Also, if Ringo is allowed to go back on the promise, it would be inequitable for Elena as Ringo was already giving lease at half the rates to new businesses. Applying the obiter statement given in Central London Property Trust Ltd v High Trees House Ltd, Ringo would not be allowed to go back on his promise. Hence, it can be concluded that owing to the misrepresentation of Ringo, Elena will be successful in getting the lease terminated and the applicability of promissory estoppel would stop Ringo from claiming the reduced rent as rent in arrears. 2.In order to form a contract, a promise has to be made between two or more parties, where one side pays consideration and other party does something based on the promise which has been made (Clarke and Clarke, 2016). For creating a contract, there have to be certain essential elements for creating a contract. These include offer, acceptance, denoting the agreement, followed by intent, consideration, legality, capacity and lastly, genuine consent (Ayres and Klass, 2012). Genuine consent is a major condition for forming a contract, which denotes that the parties have entered into the contract with their free will and in a free manner. Different factors can affect the presence of genuine consent in a contract and these include duress, mistake, undue influence, misrepresentation, and unconscionability (Turner, 2014). Unconscionability can be shown when a party is at a special disadvantage while the other party is dealt with, due to different reasons like impaired facilities, inexperience, ignorance, illness, financial needs or the other situations and it can affect the ability of looking after the interest of the second person (McKendrick and Liu, 2015). For establishing this, it has to be shown that dominating party had the knowledge regarding the weaker partys disability, and was also having the knowledge regarding the presence of an opportunity, through which an advantage can be taken for creating a contract with the weaker party by the dominating party. So, through this concept, the dominating party can take unfair advantage of the weaker party. When unconscionability can be shown to the satisfaction of the court, the aggrieved party can get the contract rescinded (Emanuel, 2006). Commercial Bank of Australia v Amadio (1983) 151 CLR 447; [1983] HCA 14 is one of the cases where unconscionability was established. In this case, the business debt of the son of an elderly Italian migrant couple was guaranteed by the couple to the Commercial Bank (Swarb, 2017). When the mortgage was being executed, the bank manager had the knowledge of the precarious financial position of the son and was also aware that Amadios could not speak proper English. Yet they were not informed about this and the bank even did not explain the entire situation to them nor did they suggest the Amadios to get an independent advice. Owing to these reasons, the court upheld that there was unconscionability in the conduct of the Commercial Bank (Australian Contract Law, 2013). A contract can be discharged in different manners, one of which is the termination of contract. When one of the parties under the contract, fails to perform their side of obligation under the contract, the aggrieved party, which is the non-breaching party, can make a claim against the breaching party for a breach of contract. And in such cases, the remedies can be applied by the aggrieved party, which are in the form of equitable remedies and the monetary remedies (Andrews, 2015). Application In the given case study, the elements of unconscionability in the conduct of George can easily be seen. George full well knew that Albert had poor English and that he did not have the correct knowledge of which plan was best for him. This is very clear from statement made by Albert to George that he should be told the best suited plan and that he wanted only something which was cheap and small. The position of George was such that he dominated in the relationship which was between him and Albert. Even then, George suggested him the plan which was the most expensive one, stating that this was the cheapest plan. Based on the case of Commercial Bank of Australia v Amadio, the taking of advantage on part of George, of the weaker position of Albert shows the unconscionability of George. Owing to these reasons, the contract can be rescinded by George; and in such a case, Albert would not be required to pay anything to George. In this case, when Albert refuses to undertake his part of the obligation a claim can be made against him by George for the breach of contract as Albert refuses to pay his part of promise, i.e., the consideration amount. However, in such case, Albert can highlight the lack of quality in the work which has been done by George. Even after he promised to undertake quality work, he did not discharge his side of the promise in the promised manner. And owing to these reasons, the claim of George would fail. Hence, Albert would not to be required to pay the promised sum to George. The remedies which can be applied by Albert would include the amount which he had to get the work properly done by another party. This can be claimed in addition to the amount which he had to pay to the consultancy firm. And lastly, even the cost of renting the apartment can be claimed by Albert. So, he would get a sum of $75,000 for fixing the slab, a sum of $75,000 for consultancy firm, and a sum of $360,000 ($300 per week for 12 weeks), which would mean a total sum of $510,000 can be claimed by Albert as the remedies for the unconscionability in the conduct of George. Further, he can also claim that he amount claimed by George, to the sum of $250,000 is not required to be paid to Albert due to the unconscionability in the conduct of George and the work being done at subpar quality. Hence, on the basis of discussion which has been carried above, it is clear that there was unconscionability in the conduct of George. Due to these reasons, Albert is under the obligation to pay the promised sum to George and can also get the contract rescinded, apart from claiming damages for the breach of contract in maintaining quality work on part of George, which would be a sum of $510,000. 3.In Australia, there are different forms of business structure in which the business can be run and operated. This includes sole trader, partnership, trust and company. Making the choice of business structure is a crucial decision as each structure comes with its own characteristics and restrictions (Gibson and Fraser, 2014). In a partnership form of business structure, there is an association or a group of people who come together for a common purpose of running the business of the firm and where the profits are distributed between them in an equal manner. In Australia, each jurisdiction has its own Partnership Act, which is applicable on the partnerships of that region. So, for instance, in New South Wales, the Partnership Act 1892 is applicable and in Victoria, the Partnership Act 1958 is applicable (Department of Industry, Innovation and Science, 2017). The setting up and operating of partnership is quite inexpensive in comparison to the other business structures. In a partnership, the income and losses are shared, along with the control of the business. It is not obligatory to draw up a partnership deed for the partnership to exist; though, it helps in removing any ambiguities which can be raised in the future. The partnership deed contains the details on the manner of distribution of profits and los ses and also the manner of control over the business. Under partnership, the partners are not deemed as the employees; however, workers can be employed in it (Australian Taxation Office, 2017a). There are various strengths and weaknesses in a partnership form of business structure. The strengths include: More skill set in comparison to a sole proprietorship due to two heads being better in comparison to a single one; The startup costs are low and the business is easy to establish; Availability of higher capital in comparison to sole proprietorship; Availability of higher borrowing capacity; Employees with high caliber can be made partners; The income and losses can be spilt, which results in tax savings, which is not possible in sole proprietorship; The business affairs of the partners are private; There is also a limit on the external regulations; The legal structure of the firm can also be changed in desired circumstances (Tasmanian Government, 2017a). However, all is not good in partnership form of business, and there are quite a few weaknesses in this business form. These have been summarized below: The biggest drawback of partnership is unlimited liability of all the partners. This means that in case of any loss, the partners are severally and jointly liable for the debts of the partnership. And in order to pay the debts of the company, the personal property of the company can be used to discharge these debts. There can be cases where there is friction or disagreement between the management and the partner; The partners are deemed as agents of the partnership and for their actions, all the other partners are liable; In case a partner decides to leave or join, the partnership has to be revalued, which proves to be a costly affair (Tasmanian Government, 2017a). Moving on to the other famous form of business structure, company, it is leading choice of business structure in the nation. A company has the status of a separate legal entity, which means that is different from the people who run it. The setting up company is a costly affair and also has a number of reporting requirements, which are not present in the other forms of business structures. The Corporations Act, 2001 (Cth) is applicable on all the companies formed in the nation and are governed by the ASIC, i.e., Australian Securities and Investments Commission (Cassidy, 2006). The directors of the company run the company, which is owned by the shareholders. Broadly, there are two types of companies in the nation, i.e., the proprietary limited company and the public companies. The proprietary limited companies are not allowed to raise money from the general public; though it can still issue shares and the public companies, do not have such restriction (Australian Taxation Office, 2017b ). The company form of business also has different strengths and weaknesses. The strengths of the company include: The shareholders have a limited liability; The ownership can be easily transferred by selling the shares of the company to another party; The shareholders can also be employed by the company; The companies can freely trade in the nation; The rates of taxation are quite favorable; A wider skill and capital base can be accessed in this structure (Tasmanian Government, 2017b). As is with any other business structure form, the companies also have certain weaknesses, which have been summarized below: The maintenance, establishment and even the winding up of the company is a very costly affair; There are a range of compliances which have to be followed and which complicates the entire process specially for such individuals who work in sole proprietorship form; The financial affairs of the company are a public matter; The directors of the company can also be made liable in personal capacity, where they fail in keeping their lawful obligations; The profit which is distributed amongst the shareholders is taxed (Tasmanian Government, 2017b). A trust is also amongst the business structures which can be adopted in the nation. In this, a trustee is given the responsibility for the operation of trust. However, this business structure is not often selected by the individuals owing to its complexities (Australian Taxation Office, 2017c). In the facts of the case study, it is clear for Harry that he wants to raise capital for his business and also wants to retain control over the businesss direction, along with keeping the right employees. Based on these requirements, a partnership form of business structure is best suited for Harry as he can raise capital by adding partners, hire the right employees and by stating in the partnership deed that he has the absolute control over the direction of the business, can retain the control. This would not be possible in a company business structure, as the company runs for the shareholders of the company and the control is with directors, which includes executive and independent directors. So, even though higher capital can be raised in company business form, the control over the direction of the business would have to be shared. Further, even a proprietary company would not suit him as he does not have close family members, through whom he can raise the required capital. On the basis of this discussion, it can be concluded that harry should opt for a partnership form of business. References Andrews, N. (2015) Contract Law. 2nd ed. UK: Cambridge University Press Atkins, S. (2015) Equity and Trusts. 2nd ed. Oxon: Routledge. Australian Contract Law. (2013) Commercial Bank of Australia v Amadio. [Online] Australian Contract Law. Available from: https://www.australiancontractlaw.com/cases/amadio.html [Accessed on: 08/08/17] Australian Taxation Office. (2017a) Partnership. [Online] Australian Government. Available from: https://www.ato.gov.au/Business/Starting-your-own-business/Before-you-get-started/Choosing-your-business-structure/Partnership/ [Accessed on: 08/08/17] Australian Taxation Office. (2017b) Company. [Online] Australian Government. Available from: https://www.ato.gov.au/Business/Starting-your-own-business/Before-you-get-started/Choosing-your-business-structure/Company/ [Accessed on: 08/08/17] Australian Taxation Office. (2017c) Trust. 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