The prosecution of James Phang Wah and Jackie Hoo Choon Cheat directors of an insolvent company, Sunshine Empire - Essay Example

Media report Analysis The article reports on the prosecution of James Phang Wah and Jackie Hoo Choon Cheat’ directors of an insolvent company, Sunshine Empire, a multi-level marketing company that sold packages while promising higher returns. Criminal Law The firm swindled investors who bought lifestyle packages. The firm also promised investors returns which were not from genuine profits but were actually funds recycled from new members joining the scheme. These two scenarios constituted criminal law. Another case is where Phang’s wife was paid a commission of nearly 950,000 US dollars for her work as the company’s group sales director, a job she never had or did. Corporation Law Sunshine empire was a corporation. Therefore all its operations were governed by the corporations’ law that existed. Some of the requirements of this law are proper maintenance of books of accounts. This company never kept proper books of account. On the other hand, a company is normally formed with the sole object of not dealing in illegal trade. The company also breached this by processing uncensored and obscene films. All these cases led to the breach of corporations’ law. Property law The company is being wound up. Therefore, the Commercial affairs department has seized about twenty-one million US dollars and will establish how these funds should be disbursed to the firm’s creditors. This constitutes property law. Contract Law The directors’ intention of selling 26,000 packages and earning 180, 000 US dollars was unacceptable. They knew that the scheme would fail. An important aspect of Law of contract is ‘acting in good faith.’ The directors breached this provision. On the other hand, Phang’s wife is also being fined for falsifying payment vouchers. This constituted a breach of contract law. How the Law helps in the following Situations Allows people to Organize and Plan Law in itself can help people organize and plan their future actions. In the case of Sunshine Empire, investors are applying the provision of the law to plan their future actions. This is evidenced by the fact that they buy packages from Sunshine Empire with the hope that they will get higher returns. There was a risk though with such investment as the company could collapse in the future leading to heavy losses to investors; and true to this, the company eventually went under receivership. How Law Encourages or discourages Particular activities Law can act to encourage or discourage certain activities. The prosecution of directors is a common example where the law doe not permit swindling of investors money through fraudulent activities. The directors defrauded the public of their through false investment activities, hence had to pay for their illegal acts (Howitt, p68). The law also acts to encourage compensation in cases of losses being suffered by a given party to a contract. This is seen when the commercial affairs department of company sets aside money to disburse to the firm’s creditors. How Law Creates Rights and Duties that can be enforced The contract between Sunshine Empire and its investors is a clear indication of a situation where law can create rights and duties which can be enforced. The investors invest their funds in the hope of higher returns in the future. The company gets wound up and the Commercial Affairs Department sets aside funds to settle creditors’ claims. By settling the creditors claim, a right of compensation in case of damages or loss is being enforced. How Law Provides remedies when Rights are interfered with or duties are not discharged In this case, creditors are being given funds set aside to cover for their losses as the company goes into liquidation. This clearly shows how law can be used to provide remedy in case of interference with somebody’s rights or where duties in a contract are not fully discharged. Why it is Important to know the law in the circumstances described in the Media report Members of the public at large should know the provision of the law for any unscrupulous people not to take advantage of their ignorance. In the case of Sunshine Empire, the directors formed a company with the aim of swindling money from innocent investors who wanted to make a fortune out of their investments in form of returns. The directors’ actions did not go unpunished as criminal proceedings were leveled against the thus landing them in jail. If the people were not aware of their rights in as far as the law was concerned, may be these two directors could have gone scot- free. At the same time, knowing law would help one be aware that in case of breach of contract by a party to a contract one can get remedy for such losses in form of compensation. This is seen where the creditors get compensated when the company becomes insolvent. PART B Clarke Vs University of Lincolnshire 1) The reported case was decided in the Court of Appeal, Civil Division 2) No. This is because the common law rules that apply in the United Kingdom are different to those that apply in Australia. Secondly, no judicial precedent is cited touching on any Australian cases. 3) Name of Judges who heard the Case- The judges who heard the case were Mr. Lord Woolf and Mr. Ward Sedley Lj. 4) What were the full names of the parties? What are those parties called and why? C was Miss Clark. She was called an appellant because of bringing an appeal against her former university after the abandonment of her plagiarism case earlier. 5) Material Facts of the Reported Case The claimant, Miss Clark, bought a legal suit against the university. She was disputing her examination mark, after being awarded a mark of zero on the basis of plagiarism in her work. The university also claimed that she was late in submission of her work. She disagreed with these reason given since she claims the plagiarism case had been sorted out and that she had also informed her tutor the reasons for her late submission of work. On that basis, she decided to go to the courts for justice. 6) Main Legal issue to be decided The main legal issue to be decided was whether the contractual dispute between the student and higher education corporation was within the mandate of the courts to handle or not. Secondly, the court should determine whether there was an abuse of of the universty’s processes in as far as dealing with the students cases was concerned. Decision of the Court The court allowed Miss Clarke’s appeal to the extent of restoring the action. It was decided that both parties should sit down and dialogue, thus giving mediation a chance. A written agreement was also reached on how the university will handle the matter. This entailed the circumstances in which if at all, the action may further be prosecuted. 1) Expressing Ratio Decidendi of the Reported Case The rationale behind the court’s decision was clear. Clark made a mistake which was common to all as she failed to back up a copy of her work and on the last day before the deadline, all her stored work were lost from the hard disc. The university board of examiners also failed her for plagiarism and awarded her a mark of zero despite her explanation to her tutor so that examiners could be informed. Secondly, the academic board also failed to comply with the decision of the governor’s appeal body on remission. 2) Number of Precedents that can be identified. There are sixteen precedents. These help give a point of reference for cases that were earlier decided and are similar to the current cases. Reference Howitt, Dennis. Crime, the media, and the law. Chichester [England: Wiley, 1998. Print. Read More