![Salomon v. A Salomon & Co. Ltd [1897] AC 22 is the most important decision ever made by the English courts in Relation to company law.](https://mbt-essays-prod-public.s3.eu-west-1.amazonaws.com/73324/listing/73324_1.jpg)
Salomon v. A Salomon & Co. Ltd [1897] AC 22 is the most important decision ever made by the English courts in Relation to company law.
Name: JI KE Department: International Finance College Beijing Normal University Faculty of Business, School of Law Kingston University Lecturer: Mr. John Tribe, Kingston University Commercial Law Assignment Due Date: Dec 10 A: Salomon v. A Salomon & Co. Ltd [1897] AC 22 is the most important decision ever made by the English courts in Relation to company law. The fundamental concept to become familiar with when commencing a business is the idea that the business has a legal personality in its own right, particularly when it assumes the form of a Close Corporation, or a Limited Liability Company. This essentially means that if one commences business as a Close Corporation, or as a Limited Liability Company, then the Corporation or Company is a legal entity with distinct legal personality separate to that of the owners, members, or shareholders.(2) As a separate entity, the company is distinct from the directors, employees and shareholders. And the distinction has been rightly insisted by the law that it should be duly observed: Lee v Lee's Air Farming Ltd [1961] AC 12. "In particular the company does not act as the agent of the directors and, in general, they do not incur personal liability for the acts of the company or its employees: Rainham Chemical Works Ltd v Belvedere Fish Guano Co Ltd [1921] 2 AC 465, 488 per Lord
Deadlock Ltd is a small quasi-partnership formed by four people including Mr. Chubb, Mr. Bolton and two other people holding 25 shares each and they are all directors.
Deadlock Ltd is a small quasi-partnership formed by four people including Mr. Chubb, Mr. Bolton and two other people holding 25 shares each and they are all directors. The article of association has a clause that on a resolution to remove one of the directors from his post as director, his shares carry four times the votes as other shares. After some time, the relationship between Mr. Bolton and the other members is soured. They passed a resolution at a General Meeting in accordance with s.303 CA 1985 terminating his directorship at the end of the year. They also pass a special resolution that in the interim he is to act solely on the advice and direction of the other directors. Bolton opposes these measures. Mr. Chubb refused to allow Mr. Bolton to address the other members at the meeting and since then, he has never been sent notice to attend the board meeting. Generally, this case is concerned with the director's right and minority protection. In this essay, I will classify and analyse this case according to relevant statutes and cases. Firstly, s303 CA 1985 allows a company to remove a director by ordinary resolution in a general meeting before the expiration of his period of office notwithstanding anything in the articles of association or any agreement between the company and the director from its board. However the articles here contain a 'weighted voting
Prepare a report for Bernie and the other shareholders on the issues arising from the proposed diversification into gliding and their chances of preventing Sid and Kenny from pursuing their plans
Student I.D.- 11207984 Company Law 1 Assignment 2004-2005 Question 1 Prepare a report for Bernie and the other shareholders on the issues arising from the proposed diversification into gliding and their chances of preventing Sid and Kenny from pursuing their plans [40 marks]. Answer To: Bernie and other Shareholders From: Mehtab Hamad Shabir As requested here is a report on the issues arising from the proposed diversification into gliding and the chances of the shareholders preventing Sid and Kenny from pursuing their plans. To start it may be worth noting that Sid and Kenny have not even discussed the issue of diversification with the other shareholders, even if they had they would have had the majority decision as they own 60% of the shares and therefore have a majority. This would therefore seem to be of little consequence. Firstly I will discuss the issues arising from the wishes of the remaining shareholders to block the proposed diversification. This is an issue that relates to the powers that minority shareholders have and under what circumstances they may attempt to overturn a decision made by the majority. In Re Kong Thai1 Lord Wilberforce stated that "Those who take interests in companies limited by shares have to accept majority rule". Majority rule and the existence of the company's separate legal personality produce an important consequence. In Foss v
Property in Oneself
PROPERTY IN ONESELF 'Every [person] has a property in [their] own person. This nobody has a right to, but [them]self.'1 I INTRODUCTION The statement '[t]o be a person is to be a proprietor and also to be property - the property of oneself',2 reflects the dualism of self dominion espoused by John Locke and William Blackstone in the 18th Century;3 that a person - as a person - is naturally vested with absolute and inalienable rights over their own body,4 as provided by the '[i]mmutable laws of nature'.5 Whilst Anglo-western legal systems have afforded recognition of property rights in the product of 'one's labour',6 it has consistently avoided such recognition in the human body itself,7 instead preferring to express 'rights' through separate areas of law.8 In this easily quantifiable 'macroscopic' world, the human body was either: an indivisible living person, a corpse or dead body parts. 9 In modern times, technological advancements in the fields of human biology have complicated matters because the traditional law is now confronted with human derived 'property' on multiple scales and dimensions.10 The division and use of human biological material such as DNA and stem cells has expanded the use of human tissue beyond the macroscopic scale,11 raising confronting moral, ethical and cultural questions,12 and resulted in calls for the recognition of self ownership and
The most effective method of achieving the best result in advising Carla is to identify each issue and address them individually.
The most effective method of achieving the best result in advising Carla is to identify each issue and address them individually. So what are the facts? * Swan Ltd was incorporated in 1997 * It's a taxi business and 'any other trade or business conducive therewith' * It's a partnership * With 3 equal owners/shareholders/directors who are Ann, Brenda & Carla * Carla has stopped working due to ill health These are the following issues/concerns Carla has * Ann & Brenda have awarded themselves 20% pay raises even though no dividend is being issued. * Suspicions about joint venture with "Hump Haulage Ltd" * Ann & Brenda want to buy back her shares at 1/2 market value or they will pass a special resolution * Alteration of Articles. There are three types of partners in a business, the general, the dormant and the salaried partner, Carla is a general partner who under s 24 has the right to take part in the management of the business unless there is an agreement between Carla and the other partners that she should not, She is also one of the directors of the company and as a director she has certain powers, but also duties, and likewise Ann & Brenda also have duties. This is because the relationship between a company and its directors is of principle and agent, and as agents the directors stand in a fiduciary relationship to their principle, the company. In addition,
Company Law
All English companies' constitution contains a memorandum and articles of association. The articles determine how it will be run and where the decision making power lies. The content of the articles is decided by the members although the Companies Act 1985 allows for the adoption of a standard set of articles in its Table A. Generally, the articles provide that management of the company be delegated to the board of directors. The courts are reluctant to intervene in such matters, as they do not feel competent to do so. However the Law must strike the correct balance between management and the shareholders by ensuring that the articles act as a sufficient restriction on the board's managerial powers whilst also promoting business efficiency by not allowing unnecessary restrictions contained in the articles to hinder the general management of the company. Table A, regulation 70 gives directors wide managerial powers. It is important that this should be so, as directors have the specialised knowledge to manage companies. Shareholders may not interfere by instructing directors on how to carry these out unless by special resolution1, as they may not know what decisions are best for the company and may have in mind their personal short term interests. Too much interference by the courts would also be detrimental to the company and lead to overcautious directors. Even when
Company Law
Following the decision of the Court of Appeal in Adams v. Cape Industries plc (1990) Ch 433 discuss how far you agree with the statement that the court's ability to lift the veil of incorporation is now "limited to cases involving an "enemy corporation" or where the company is classed as a facade." Starting a business up and running it is a big risk which has to be thought about before proceeding with it. To make a company successful requires a lot of hard and sacrifices, if that hard work is not put in then chances are that the company can incur heavy losses and problems running it. A limited liability is necessary for a business to have because without it the shareholders would lose personal assets and personal cash if the company is to be liquidated or is in debts that the company does not have sufficient funds to pay off. Limited liability is a term that is describes that members are only liable for the amount unpaid on their shares and not for the debts of the company, and any capital they had injected into the company would be lost if the company had to pay its debts or had been liquidated. 'Corporate Veil' is "A legal term referring to the separation between a shareholder and a corporation. The term refers to the fact that a shareholder is not liable for the debts of the corporation" A corporation is seen or treated as separate and distinct from an individual or
company law
s. 459 Companies Act 19851 allows a minority shareholder to apply for court-sanctioned relief where her interests as a member of a company have been unfairly prejudiced. Its development has provided an alternative to winding up a company, which is unfair to the petitioner if company assets are minimal2. Whilst the court has an unfettered discretion in awarding such order as it thinks fit3, it usually provides that the majority must purchase the shares of the minority at a pro-rata rate4; thus, the offer to purchase the shares at market value negates the unfairness. In claims against large or public companies, the courts are reluctant to grant relief under s. 459, mainly because market forces and the availability of sale via the Stock Exchange provide for speedier and cheaper exit5. Moreover, as shareholders in public companies are entitled to believe that the Articles of Association and the Companies Act 1985 contain the constitution of the company, the courts are averse to looking beyond their formal rights6. Therefore, this discussion will focus on quasi-partnerships7, companies that are established on the basis of mutual confidence and trust between the members. The conduct complained of must be both unfair and prejudicial to the interests of the petitioner: unfairness or prejudice alone will not suffice8. The test for unfairness is objective in the sense that the
Contract Law
Memorandum of Advice DATE: 12 April 2009 RE: The Fundamental Concepts of Contract Law in Australia and Brazil Background and Purpose of the Memorandum I am a Business Manager represented, Hope PTY LTD, multinational furniture trading company in Australia. This coming session, our company has just appointed an agent to promote our business in Brazil. I have been appointed to conduct a seminar to educate the Brazilian team on the basic concepts in contract law in Australia and emphasizing the major differences between the two legal systems in Australia and Brazil in relation to contract law. INTRODUCTION In order to advice the Brazilian team, it will be first to assist them to understand the fundamental concepts of the two major legal systems in the worlds today consist of common law and civil law. The common law has adopted to the whole of England, the principle of the rule of law suggests that it includes the choice of law, jurisdiction.1 On the other hand, civil law is formatted contrasted against common law, which is the legal system developed in Roman law principles.2? We must first bear in mind that the different legal systems are developed in different countries, which Australia practice the legal systems of common law; in contrast, Brazil practice the legal systems of civil law. DISCUSSION Contracts occur in our day-to day life activities. A contract is a
Limited liability
TABLE OF CONTENTS I. INTRODUCTION 2 II. THE CONCEPT OF LIMITED LIABILITY 3 III. WHY LIMITED LIABILITY? 3 IV. AREAS OF CONCERN 3 I) MORAL HAZARD 3 II) IMMORALITY 3 III) CLOSELY HELD COMPANIES 3 IV) GROUPS OF COMPANIES 3 V) TORT CREDITORS 3 V. CURRENT REGULATION AND THE NEED FOR REFORM 3 I) RULES RELATED TO SHARE CAPITAL 3 II) IMPOSING LIABILITIES ON MANAGERS OR SHAREHOLDERS 3 III) JUDICIAL VEIL PIERCING AND GROUP OF COMPANIES 3 IV) SMALL BUSINESSES, TORT CREDITORS: REVOLUTIONARY REFORMS? 3 VI. THE WAY AHEAD 3 I. Introduction The institution of limited liability for companies has typically been regarded as one of the most important innovations of the late industrial revolution period. This view was appropriately expressed by one early commentator, who stated: "The limited liability corporation is the greatest single discovery of modern times... Even steam and electricity are less important than the limited liability company"1. Commentators generally consider that limited liability has been proved a vital instrument in the attainment of economic growth. However, recent analysis of the limited liability principle have questioned its potential advantages and have argued for adoption of a more restrictive approach by the regulation. It is the aim of this paper to analyze the importance of the existence of limited liability companies in the 21st century, as a means