Company law problem questions and answers. Chapter 8 Outline answers to problem questions 2022-10-29
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Company law is a branch of law that deals with the regulation and operation of companies and other business organizations. It is an important area of law that governs the formation, management, and dissolution of companies, as well as their relationships with shareholders, employees, customers, and other stakeholders. In this essay, we will discuss some common company law problem questions and provide answers to them.
What is the difference between a private company and a public company?
A private company is a type of business organization that is not listed on a public stock exchange and is not required to disclose certain financial and other information to the public. Private companies are often owned by a small group of shareholders and are not required to follow the same strict regulations as public companies. On the other hand, a public company is a business organization that is listed on a public stock exchange and is required to disclose financial and other information to the public. Public companies are owned by a large number of shareholders and are subject to stricter regulations and oversight by regulatory authorities.
What is the role of directors in a company?
Directors are responsible for the overall management and direction of a company. They are elected by the shareholders and are responsible for making decisions on behalf of the company and for ensuring that the company operates in a legal and ethical manner. Directors are also responsible for preparing financial reports, setting company policies, and making decisions about investments and other matters that affect the company.
Can a company be held liable for the actions of its employees?
Yes, a company can be held liable for the actions of its employees in certain circumstances. For example, if an employee of a company causes harm to another person while acting within the scope of their employment, the company may be held vicariously liable for the employee's actions. In addition, if a company fails to provide a safe work environment or fails to adequately train its employees, it may be held liable for any injuries or accidents that occur as a result.
What is the difference between a company and a partnership?
A company is a business organization that is formed and regulated by company law. It is a separate legal entity from its owners, and its shareholders have limited liability for the company's debts and obligations. On the other hand, a partnership is a business organization that is owned and operated by two or more individuals or entities. Partnerships do not have a separate legal identity from their owners, and the owners have unlimited liability for the partnership's debts and obligations.
What is the role of shareholders in a company?
Shareholders are the owners of a company and have the right to vote on important matters related to the company's operations, such as the appointment of directors and the approval of major business transactions. Shareholders also have the right to receive a share of the company's profits in the form of dividends. However, shareholders do not have any direct control over the day-to-day management of the company, and their liability for the company's debts and obligations is limited to the amount of their investment in the company.
In conclusion, company law is a complex and multifaceted area of law that deals with the regulation and operation of businesses and other organizations. It covers a wide range of issues, including the formation, management, and dissolution of companies, as well as their relationships with shareholders, employees, customers, and other stakeholders. Understanding the answers to these common company law problem questions can help individuals and businesses navigate the complex legal landscape of operating a company.
Problem Questions on Company Law
S113 3 provides that a proprietary company must not engage in any activity that would require disclosure, except for an offer of its shares to a existing shareholders or employees of the company or of a subsidiary of the company. The company has entered into a contract with the third party for purchasing furniture, hiring servants for maintaining omnibus. Hence, it is possible to have 4 directors. S 5 6 are enacted, so that it prevent entrepreneurial and business activity existing directors. If Tom Dick and Harry were to risk everything in the business, that is, if they invest all there assets in the business, then they would still lose it all if the company were to become insolvent. In the second case, as per the Article 3A of the Landlord and Tenant act 1985, Richard should have given a written notice at least to the house owner stating his financial problem.
Jones BTEC Level 3 National IT Student Book 1 K. The issue is that Tom did not sign any purchase clause with Richard. Furthermore, another difference between company and partnership is the liability. As opposed to Options 1 and 2, Option 3 is entirely new articles. For this purpose, a director is treated as being aware of matters, of which he ought reasonably to be aware.
Insolvency Problem question Full answer (Company Law)
A director of a single director Pty Co does not have to disclose material personal interest S191 5. Zuhri should consider setting up a partnership if the number of people that involved in the business is less than twenty people Tasmanian Government, 2014. Referring to the reference case of Attorney General v. From simple essay plans, through to full dissertations, you can guarantee we have a service perfectly matched to your needs. Samuel in his capacity as promoter is liable to himself as Samuels Cars. Advise Finance Group Ltd of the requirements and the procedure for registering the charge.
(DOC) Commercial law problem question and suggested answer
Effect: s Offence of failure to declare interest s 1 : A director who fails to comply with the requirements of section 182 declaration of interest in existing transaction or arrangement commits an offence. Based on the reference case, the court held that a company that incorporated for carrying on a hotel could reasonably purchase furniture, hire servants and maintain omnibus to attract more intending customers to the hotel to enjoy a full range of facilities that are provided by the hotel. Byrne AQA A-level History D. However the promoter must never sign a contract in the name of the company prior to incorporation. Students should set out and discuss the requirements of the section. However, there are exceptions to this principle and this aspect is one of the most ambiguous areas in company law. Hooper Cambridge International AS and A Level Biology Coursebook with CD-ROM M.
The company will also be required to complete an annual return and pay a fee on filing it with the Registrar. Therefore, a director who has more experience, knowledge and skill will have a higher threshold in discharging this Remedies s 1 same as common principle cannot apply s 2 not the same as any other fiduciary duty owed to a company its directors. It should only prevent clear exploitation of business opportunities. Normally, Memorandum of Association is required and needed in the companies because it provides the information to others such as shareholders and investors about the company. Moreover, the legal difference between a company and a partnership is also includes the constitution. In this situation it is highly likely that the company will be declared insolvent. Under section 238 defines a transaction at an undervalue as one where a company makes a gift to any person and receives either no consideration for it or consideration worth significantly less than the consideration provided by the company.
Directors of a company do not owe any duty to the creditors. Lexi Holdings plc v Luqman 2009 CA ii 2 sisters are liable for turning a blind eye of their misappropriation of fund. It will affect how the business trades, the liability of those running the business in their guise of partners or directors and the liabilities of the business itself for taxation, for example, in the case of a company. As was mentioned above, a special resolution requires a 75% majority, or in this case, as there are only three members, a unanimous vote. Advise as to the liability of the parties both under common law and the Corporations Law. They should include a clause in the AoA about Erin. It is usual for such contracts to contain a clause prohibiting former directors using their business contacts within a certain time of leaving the former directorship; a non-solicitation clause.
Company law problem questions portfolio: Various questions and answers
Helen, Tom and Joseph have, for ten years, run a small, but successful partnership. The regulations for management of the company will be set in the Articles of Association and the regulations in the Companies Act 1965 may be used Pheng, 2005. It will be deemed to be set aside if insolvency proceedings commence within two years of the transaction. After much consideration the Board of Star Ltd resolves to go with the second option and borrow the money from the Finance Group Ltd. Peteiro Popular books for Technological and Physical Sciences BTEC Level 3 National Applied Science Student Book F. The constitution of a company must be formed in writing by the Memorandum and Articles of Association. Ultra vires doctrine is created to protect the investors and creditors of the company by helping the investors to know the activities that their money is invested.
Coupland-Smith BTEC Nationals Business Student Book 2 Activebook C. The two aspects are the main purpose and the special powers that are affecting that purpose. Under S249N a member has the right to require a company to put resolutions to be considered at a general meeting. As it has no present use of the proceeds of the snack food business the directors decide to return funds to its shareholders. Share this: Facebook Facebook logo Twitter Twitter logo Reddit Reddit logo LinkedIn LinkedIn logo WhatsApp WhatsApp logo Company Law problem question Question 1 a Tom, Dick and Harry are in business together in the form of a legal partnership.
Company Law Example Exam Questions & childhealthpolicy.vumc.org
The simpler structure of a partnership will also eventually lower the start-up cost of the partnership. Therefore, only the company can be sued and not the members; risk only arises to the members if assets were purchased illegally. It may be that he should have has informed Edmanuels of a conflict of interest. When Richard goes on holiday, Martin looks after his car lot. In that case, there is no need to remove this provision. Finally, in the case of Martin, the verbal offer may also be accepted as a kind of Contract for consumer credit by the judge.