BUSINESS Flashcards
Directors Duty
duty to act within powers
s 171 CA 2006
Directors Duty
Duty to promote the success of the company
s 172 CA 2006
Directors Duty
duty to exercise independent judgment
s 173 CA 2006
Directors Duty
duty to exercise reasonable care, skill and diligence
s 174 CA 2006
Directors Duty
duty to avoid conflicts of interest
s 175 CA 2006
Directors Duty
duty to not accept benefits from third parties
s 176 CA 2006
Directors Duty
duty to declare interest in a proposed transaction or arrangement
s 177 CA 2006
Directors Duty
duty to declare interest in an existing transaction or arrangement
s 182 CA 2006
Fraudulent Trading
s 214 Insolvency Act 1986
the certificate of incorporation must state:
the name and registered number of the company
date of incorporation
if it is limited or unlimited
if it is private or public
if the registered office is in Eng and Wales or Scot
s 15 CA 2006
registered office is necessary for companies
s 86 CA 2006
every company must have at least 1 director
s 154 CA 2006
company’s constitution consists of :
memorandum of association, articles of association, certificate of incorporation, current statement of capital, copies of any court orders, shareholders resolutions, and agreements involving shareholders
s 17 and s 29 CA 2006
model articles are by DEFAULT
s 20 CA 2006
for an ordinary resolution to be passed, over half of the votes cast at a shareholders meeting must be in favour of the resolution
s 282 CA 2006
for a special resolution, 75% or more must be cast
s 283 CA 2006
Minimum notice for a general meeting is 14 clear days
s 307 and 360 CA 2006
the quorum for a general meeting is two
s 318 CA 2006
Short notice - it is possible to hold a general meeting on short notice
s 307(4) CA 2006
written resolutions can be used to pass a resolution
s 288 CA 2006
failure to keep adequate accounting records is an offence
s 387 CA 2006
Unfair prejudice petitions. allows any shareholders to apply to the court for an order for a remedy where they feel they have been unfairly prejudiced as a shareholder
s 994 CA 2006
Derivative Claims, instigated by a shareholder for a wrong done to a company which has arisen from an act or omission of a director
s 260-264 CA 1006
de facto directors, act as a director, although they have never been appointed
s 250 CA 2006
shadow director, their directions and instructions are followed by directors of the company
s 251 CA 2006
long term service contracts that are more than 2 years must be approved by shareholders by ordinary resolution
s 188 CA 2006
changing the company articles permanently, by special resolution
s 21 CA 2006
special notice is required for a resolution to remove a director
s 312 CA 2006
wrongful trading - if the company has gone into insolvency, and before commencing winding up, the director knew, or ought to have known, that there was no reasonable prospect that the company would avoid insolvent liquidation
s 214 CA 2006
substantial property transaction: a director, in personal capacity or someone connected, buys from or sells to the company, a non-cash asset of substantial value
190-196 CA 2006
loans to directors : a company may not make a loan, unless it has been approved by the companys shareholders by ordinary resolution. UNLESS, it is expenditure on company business, for defending civil.criminal proceedings in relation to the company or themselves, or minor business transactions less than 10,000
s 197 CA 2006
the directors of a private company have permission to allot shares without shareholder approval, if they are of one share type
s 550 CA 2006
allotment of shares is when company issues the right to be included in the company’s register of members in respect of the shares
s 558 CA 2006
a company with more than one class, must obtain permission from shareholders before allotting shares
s 551 CA 2006
pre-emption rights must be considered before a company allots “equity securities” (ordinary shares)
s 561 CA 2006
a person is not a shareholder of the company until they are registered on the members register
s 113 CA 2006
buyback - must not forbit it, they must be fully paid, company must pay for the shares, out of distributable profits, and shareholders must pass OR authorising
s 690-696 CA 2006
private companies are permitted to buyback their own shares out of the capital, unless the company articles forbid buyback out of the capital
s 709 CA 2006
a company can execute a deed, by its seal, or by the signatures of either 2 authorised signatories (director or secretary), or a director and a witness)
s 44 CA 2006
what is the partnership act
partnership act 1890
a partnership comes into existence when 2 or more persons are carrying on a business in common with a view of profit
s 1 PA 1890
with three exceptions, all decisions in a partnership must be taken by majority
s 24 PA 1890
a partnership is dissolved when a partner retires
s26 PA 1890
the partners can apply to court that the partnership is dissolved if a partnership becomes incapable of performing, prejudicial
s 35 PA 1890
when a partnership is sold, the proceeds of the sale are first to the firm, then to the partners who lent money, then to the partners via capital, then to any partners
s 44 AP 1890
partners have responsibilities to be open with each other, to account any private profit, and to not compete with the firm.
s 28 - 30 PA 1890
actual authority and apparent authority in a partnership
s 6 and s 5 of PA 1890
partneres are liable jointly with others for debts incurred while they were partners
s 9 and s 17 PA 1890
a partner when they leave, must comply with this act to make sure they escape liability of any debts entered into AFTER they have left/
s 36 PA 1890
holding out of a partnership
s 14 PA 1890
limited liability partnership act
Limited liability partnership act 2000
AND
limited liability partnership regulations 2001
compulsory liquidation: establishing the grounds
s 123 IA 1986
an individual is insolvent if a debt is payable now by the debtor doesn’t currently have enough money, or payable in the future, and there is no reasonable prospect that the individual will be able to pay.
s 267 IA 1986
a company is insolvent if it is deemed unable to pay its debts, whe na creditor has served a statutory demand from an outstanding sum of more than 750, and wait 21 days, or obtained judgment, or it can be proved by the cashflow test or balance sheet test.
s 122 and 123 IA 1986
expulsion of a partner
s 25 PA 1890
Retirement at will
s 26 PA 1890 and s 32
transaction at an undervalue
s 238
preferences
s 239
extortionate credit transactions
s 244
avoiding certain floating charges
s 245
administration
sch B1 1A
defrauding creditors
s 423
