First Principles of Business Law

2.1. Property rights in land

2.1.2. Case study: The Kitchen Factory

Albert Morton is a small-scale manufacturer of kitchen units. He operates his business through a company called 'The Kitchen Factory Pty Ltd' of which he is the director and sole shareholder. He sells the units he makes to builders, for installation into the houses they are building.

Albert wants to expand his business by setting up a larger factory.

Albert has learned of two properties, both in a nearby industrial area. Each of them consists of a half hectare of land with one large building on it. Either one would be suitable for his purposes.

One of these properties is for sale at a price of $500,000.

The other is available for lease for five years at a rental of $2,000 per calendar month.