Assignment:
Over the last five years, Zack a bank manager operated a Fish & Chips business 'on the side'. He sold delicious and "mouthwatering" fish and had developed a large clientele particularly in the resort section of Negril. Zack operated his business from a property he owned on Negril Drive, in Negril City. Encouraged by his customers, he quit his job and decided to incorporate a private limited liability company, namely, Fish & Chips Company Limited. Zack, his sister Rachel, and three other family members owned shares equally in the company, with Zack being the sole director and Rachel, the company secretary.
Zack sold the property which was bought for $6,000,000 to the company for $10,000,000 upon incorporation of the company. Rachel and the other subscribers were led to believe that Zack had paid $10,000,000 for the property. Rachel has recently discovered the original price Zack paid for the property and wants to take legal action.
Penny, one of Zack's customers bought a Fish & Chips meal from the Company and became severely ill after consuming the meal. She is contemplating bringing legal action against the company. However, Zack is contending that Jack his employee who had prepared the meal should be held personally liable and not the company.
1. Advise Zack on all Issues arising from the case using the IRAC principle
2. Advise Zack on the following:
a) The difference between a Fixed and a Floating and ONE advantage of each
b) What is Inside Dealings and its implications