Law of Commercial Association
Case:
On 1 February 2009, Ajax, Sandra and Tanya entered into a partnership agreement to operate a seafood restaurant situated in a very advantageous position in a large shopping mall in Sydney. They leased the premises from West Wings Ltd, the shopping mall's owner. The lease was renewable every three years.
On 20 December 2011, Ajax had a spiteful argument with Sandra and Tanya, which led to the three partners' decision to terminate the partnership agreement. As a result, on 5 January 2012, the Supreme Court of New South Wales appointed a receiver for the purpose of winding up the affairs of the partnership.
On 31 January 2012, the lease on the premises expired. As Ajax was no longer talking to Sandra and Tanya, the three partners did not apply to have the lease renewed. Ajax quickly found himself new premises to carry on his restaurant business situated in another shopping complex a few hundred metres from the previous premises. However, West Wings Ltd permitted Sandra and Tanya to continue using the premises in the mall until they found alternative premises to which to move.
Meanwhile West Wings Ltd entered into a new three year lease with Kamal. According to the terms of the lease, Kamal would move in only when Sandra and Tanya found alternative premises. Three months later, Kamal sold the lease to Sandra and Tanya.
This development has angered Ajax who believes that Sandra and Tanya were in breach of their fiduciary duties owed to him.
Questions:
(a) Did Sandra and Tanyabreach their fiduciary duties owed to Ajax?
(b) What remedy, if any, may Ajax seek against Sandra and Tanya?
(c) Would your answer be different if Sandra and Tanyamoved out of the premises before they purchased the new lease from Kamal?