A Hole in His Parachute - Essay Example

A Hole in His Parachute A Hole in His Parachute Knight sold every share he owned from Knight- Ridder Company, a newspaper business, to Murdoch. However, the fact that he had owned the entire corporation before, he made an agreement to partner with Murdoch as an adviser for the corporation in a period of five years. An agreement was therefore made under a condition that Knight would receive a salary of 2.5 million dollars annually, for his quality services. In a period of three years, Murdoch requested for corporate dissolution and definitely breached the agreement they had made with Knight.

However, Knight still has an opportunity to claim his salary for the remaining two year because upon signing the agreement, he obtained a right of interest as a partner in the Knight-Ridder Corporation. It is this right that will therefore be used to claim for his salary in the next two years. In this case, his right is much protected by a business law which also consists of a number of laws such as commercial law, partnership law and Federal Corporation law (Mallor, 2012).These laws therefore guarantee him of the high chances of getting his money.

According to Mallor (2012), an agreement is a legal and binding document that reveals the obligations of two or more parties involved in a business. Both Knight and Murdoch made an agreement where each was expected to have his own obligations. Knight was expected to offer advises to the Knight-ridder Corporation about the newspaper for five years. Murdoch on the other hand, was expected to pay Knight an annual salary of 2.5 million dollars for his services. However, breaching of agreement is the failure to accomplish duties and terms agreed upon by the two parties.

Murdoch failed to fulfill his obligation through dissolution of Knight-Ridder Corporation before a period of five years therefore terminating Knight’s salary for two years. The legal and binding document established by the two partners gave them legal rights in the Corporation. Murdoch obtained the right of ownership as an employer, and as the largest shareholder of the Corporation while Knight acquired the right of interest as a partner. Since Murdoch failed to perform his duty as revealed in the legal and binding document, he is viewed as violating Knight’s right as a partner.

Knight can therefore take steps to reclaim the money owed to him by suing Murdoch through a court of law. In the court, a judge would solve the case through the guidance obtained from a business law which oversees the various types of business transactions such as mergers and acquisitions, contracts and leasing. It also deals with defining responsibilities and rights of partners in a business (Dye, 2012). A business law would therefore be effective if at all it consider two objectives from the agreement; providing an outline of the obligations of the individuals involved and determining enduring responsibility for a particular service.

However, there are a number of laws under the business law that would support Knight’s right, as a partner in Knight-Ridder Corporation, to reclaim his salary (Mallor, 2012). The first one is commercial law which governs commercial transactions in a business and regulates corporate contracts. The second one is partnership law which ensures that each partner has a power in a Corporate and that they are highly involved in its internal matters. Finally we have federal corporate law which regulates the way corporate securities are sold and issued.

In conclusion, this paper gives a clear explanation of how an agreement between Knight and Murdoch came into existence and what lead to it being breached. According to the paper, Knight is the main character being affected by the breached agreement where his salary is not fully paid as agreed. He therefore uses his rights as a tool to reclaim his money through support from a business law which governs this right. However, the business law does not work alone, but gain support from commercial law, federal corporate law and partnership law.

ReferencesMallor, J. , Barners, A. J. , Bowers, L. T. & Langvardt, A. (2012). Business Law. New York, NY: McGraw- Hill/Irwin.Dye, F. (2012, September 20). What is breach of contract? Retrieved from http://www.wisegeek.com/what-is-breach-of-contract.htm