Advance documentation + questions + answers + exam tips and pointers. Note, while I got a pass mark on the OWE, my Part A was a higher mark, and with SBAQs at 90/100, I achieved a commendation on the module. My answer contains tips on how to up the OWE mark in retrospect.
Total Mark for Contract OWE: 51/100 (my total on the module was 63/100; you can
still get an overall commendation if you do well on the SBAQs. Contract law OWE is
definitely a tricky one for most students.)
My top tip for all the OWE exams is make sure you have model answers ready
for each topic with EXCAT references, and every part of the actual law
SPELLED out in full. In addition to that, if, given the law, the fact pattern could
lead to either outcome A or B, the examiners expect you to mention both of
those, even if B is the correct outcome, you will still need to explore A (with all
references, explanation, etc). Your answer should use up nearly all the word
count allowance; mine clearly didn’t and I lost a lot of marks because of that.
Plus, because I spent so much time adding meat to my Part A answer, I didn’t
have the time to complete Part B properly which I completely flopped.
PART A
Lewis Wynn is a former director of Wynn Digital Ltd (“WDL”). The company was set
up by Lewis, with seven other investors. Lewis owned 30,000 shares in the company
and the seven other investors owned 10,000 shares each.
In April last year Lewis decided to sell some of his shares in WDL to raise capital to
set-up his own company, CloudSolutions Ltd, advising small businesses on technical
support issues. Lewis would like your advice in relation to matters arising in
connection with both the sale of his shares and his new business venture.
Sale of shares
Kajal was looking to buy a portfolio of shares as an investment for her retirement,
and entered into negotiations with Lewis to buy 10,000 of his shares. Lewis told Kajal
that the shares would produce an income of £5,000 a year. Lewis did not bother to
check WDL’s records, which clearly stated that the shares only paid a fixed annual
dividend of 40p per share. Extracts from the email correspondence between Kajal
and Lewis were in the Advance Documentation and are also set out below in
Document A.
The other potential purchaser, David, is an experienced businessman. During his
negotiations with Lewis, in January, David said he would never consider investing
where another shareholder had control of the company. Lewis sent him an email,
assuring him that all shareholders would have a 10% holding in the company.
However, unknown to Lewis, one of the other investors, Yuxin was in secret talks to
buy out the other six investors.
In mid-January, Yuxin told Lewis that he had bought out the other shareholders.
Lewis decided not to tell David, and Lewis transferred 10,000 shares to David for
£50,000 on 1 May. David has just discovered that Yuxin owns most of the shares in
WDL and is demanding a refund.
CloudSolutions Ltd
Lewis has found via the internet a simple set of pro-Supplier standard terms and
conditions (Ts & Cs) which seem suited to the type of work CloudSolutions Ltd will be
,carrying out for its customers. Lewis wants your advice on how to ensure that these
Ts & Cs are incorporated into all the company’s contracts.
Advise Lewis, on the following:
his legal position in relation to Kajal and David, and
tips for ensuring standard Ts & Cs are incorporated into contracts.
Total marks for this question: 60 marks.
, DOCUMENT A
From: Lewis@Wynndigital.co.uk
To: Kajal.sharma31@gmail.co.uk
Subject: Sale of 10,000 Shares in Wynn Digital
Date: 23 May 2023: 10.00
Dear Kajal
Thank you for your email. Wynn Digital Ltd offers a wonderful opportunity for any
investor. I quite understand that, as a private investor, it is (as you stress) of “vital
importance” to you that the shares produce an income of £5,000. These are a type
of share which are guaranteed to pay a fixed annual dividend of 50p per share, so
an income of £5,000 is guaranteed.
I trust that this answers your query. Please let me know if you would like to see the
company’s accounts to verify this information.
Regards, Lewis
Director
From: Kajal.sharma31@gmail.co.uk
To: Lewis@Wynndigital.co.uk
Subject: Sale of 10,000 Shares in Wynn Digital
Date: 26 May 2023: 10.00
Dear Mr Wynn,
I do not think that I need to see the accounts. I have no reason to doubt your word.
On the basis of the information which you have given me, and having thought
carefully about this over the last week, I agree to purchase 10,000 shares in Wynn
Digital Ltd for £50,000.
Kind regards, Kajal.
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