Whitehaven Pty Ltd (‘Whitehaven’) is engaged in the business of the repair and retail sale of
reconditioned household appliances. The directors and shareholders of the company are Petra, Nimma
and Gavin (Nimma’s son). The company makes good profits, all of which are distributed as directors’
remuneration. Petra works mainly on the repair side of the business in Mordialloc, whilst Nimma
spends much of her time on sales and customer relations. Disputes arise between Petra and Nimma;
Petra alleging that Nimma is engaging in improper practices in her negotiations with customers from
which she is deriving personal profits.
It has now emerged that Nimma is the sole director and shareholder of another company, All Parts Pty
Ltd (‘All Parts’), which supplies replacement parts for fridges and washing machines. All Parts Pty
Ltd is also one of the main suppliers of parts to Whitehaven in the past 2 years. A customer, Mr
Holding, has also informed Petra that on inquiring about the cost of repairs to his washing machine,
Nimma had told him that All Parts could do the job at a lower cost by ‘cutting out the middleman’.
Nimma denies the allegations and does not believe that she has done anything illegal regarding her
involvement with All Parts. Advise Nimma whether she incur any liabilities.
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