Bondi Yoga Studio – new business legal risk management report After a number of years as a...

Question

Bondi Yoga Studio – new business legal risk management report After a number of years as a successful Chartered Accountant at a national firm, you decide to quit the rat race and pursue your true...

1 answer below »

Bondi Yoga Studio – new business legal risk management report

After a number of years as a successful Chartered Accountant at a national firm, you decide to quit the rat race and pursue your true love - yoga. You decide that your neighbourhood, Bondi, would be the perfect place to open a yoga studio. Even better, your friend Yogi, a certified yoga instructor, has just moved to town and is willing to teach at the studio. You intend to open the studio, Bondi Yoga, by 1 July 2021. You propose to initially offer 12 classes per week of up to 15 students per class, and to sell floor mats, drink bottles, candles and towels in the reception area. You are also considering offering ‘teen yoga’ classes for High School students in the area. You will need to hire two casual yoga instructors to take weekend classes.

A work colleague who ran a small skydiving business (called Sydney Skydiving) many years ago has told you about some of the problems she encountered when running that business. You want to make sure that you avoid similar problems:

A client was seriously injured when his parachute failed to open because it had been incorrectly attached to his harness by the skydiving instructor. He sued the business and obtained $700,000 in damages.

Some customers claimed they were unwell on the day of the scheduled jump, and demanded to be able to transfer their jump to another day. This was very expensive for the business, because it still had to pay the cost of hiring the plane, pilot and staff for a re-scheduled jump.

One employee bullied another employee, who sued the business and obtained $15, XXXXXXXXXXin damages for the cost of psychological counselling and lost wages.

Some customers who were initially enthusiastic ultimately refused to jump out of the plane because they became scared after take-off, including children. Many of these customers demanded a full refund, which was very stressful for staff.

The business sold souvenirs, including plastic toy planes and parachutes, but customers frequently returned the products and demanded refunds because they broke soon after purchase; however, the supplier refused to refund the wholesale purchase price, which caused your colleague’s business to lose money.

The business started losing customers after a rival business, called Skydive Sydney registered the domain name ‘sydskydive.com.au,’ which many customers mistook for your colleague’s business. Your colleague’s website was ‘sydneysykdive.com.au.’

The business was forced to close down soon after the global pandemic started because the national lockdown meant that people couldn’t go skydiving, so the business had no customers. The business couldn’t afford to continue paying the lease on the skydiving equipment and business premises or employee wages without any customers, and the landlord refused to re-negotiate the lease.

Prepare a report describing the legal risks associated with your new venture, Bondi Yoga, and how you propose to address them.

bondi-yoga-studio-z4mkslpw.docx

Answered 11 days After Mar 18, 2021

Arunavo · Accepted Answer

Bondi Yoga Studio – New Business Legal Risk Management Report	4
BONDI YOGA STUDIO - NEW BUSINESS LEGAL RISK MANAGEMENT REPORT 
Table of Contents
Introduction	3
What is Risk and What Type of Risks Affect Yoga Industry?	3
Legal Risks Associated with the New Venture and Risk Management	4
Conclusion	8
References	10
Introduction
	Here we talk about opening a brand-new yoga studio named Bondi Yoga Studio. You have chosen your neighborhood Bondi as the location of the studio. Your friend Yogi, a certified yoga instructor, will be a teacher of that yoga center. Initially there will be 12 classes per week with maximum 15 students for each class. You also plan to sell floor mats, drink bottles, candles and towels at the reception. Other than that, for high school students of that area, teen yoga classes will be arranged. Two casual yoga instructors will be hired for weekend classes. 
What is Risk and What Type of Risks Affect Yoga Industry?
	Risk is defined as the effect of uncertainty on the objectives (Muriana & Vizzini, 2017). Any new business or venture you start; you have to face some obstacles. These consists mainly legal risk. Same thing is applied for Bondi Yoga Studio also. One of your work colleagues has told you about her experience of running a small skydiving business few years ago. She had to encounter various risks and problems while running the venture. As you are going start your new business, you must make sure that you eliminate all the potential risks and avoid similar problems that your colleague had faced. For an instance, when a person is being trained by a yoga instructor, the client is vulnerable to a number of risks such as: the skill of the instructor in terms of providing instructions, risks created by the client’s technique or behavior etc. These risks are present due to the objective of engaging in a yoga activity. The only way to omit all risks would mean it is no longer possible to achieve the goal. The yoga industry, yoga instructors and clients each have a crucial role to play in setting acceptable levels of risk in order to achieve particular goals. 
	Before you start with the Yoga studio business, you must consider the risks that might harm you venture. The risks include: potential lawsuits, insurance, medical issues, yoga in the park and many more (Reeves et al., 2020).
Legal Risks Associated with the New Venture and Risk Management
	To open your new studio is to face the question of whether s client or instructor could sue you for damages based upon the exposure to COVID-19 virus in your studio. This brings many novel issues that have not yet been addressed by Australian legal system. This kind of lawsuit will be based upon negligence. Breach of duty, causation and damages are the elements of a negligence lawsuit. To recover the damage, the client or instructor might have to show that you had a responsibility to either not open the studio during the pandemic or a responsibility to open it more safely, you breached the duty, it was the reason of the client or the instructor contracting to COVID- 19 and the client or instructor faced damages. These would include the cost of medical expenses and perhaps compensation for death. A question must be raised whether you should have opened the studio during pandemic. Though you had the legal right to do it, the client or instructor might say that the unique nature of yoga suggests that you should not have opened the yoga studio even if you had the government’s permission.
	To counter this issue, you must have warned the client and student of the risk that he or she might contract COVID- 19 while practicing at the studio. If you failed to warn, then you would have breached your duty. You should also make them sign documents related the following the precaution and you will not be penalized if anyone contracts COVID- 19 in the yoga studio. On the other hand, if the client or instructor can prove that you owed a responsibility to run the yoga studio in accordance with the protocols, you failed at your duty and you caused them harm,

Bondi Yoga Studio – new business legal risk management report After a number of years as a successful Chartered Accountant at a national firm, you decide to quit the rat race and pursue your true...

Solution

Answer To This Question Is Available To Download

Related Questions & Answers

Submit New Assignment