Business law Flashcards
Names the types of companies
Sole trader, partnership, limited partnership, company,limited liability partnership
What is a sole trader
Self employed, unlimited personal liability, no legal filing required
What is a standard partnership
Minimum two members, joint liability, profit and loss shared, partners are not employees
What is a limited partnership
At least one partner has unlimited liability. Not common
What is a company
May be limited, unlimited, private or public. Separate legal personality, higher level of admin regulations
What is a limited liability partnership LLP
Hybrid of company and general partnership, separate legal entity, accounts submitted to companies house
Where are companies registered
Companies house. Belfast, Cardiff, Edinburgh
How can applications be made
Post, online or companies house software
How much is an online company incorporation
£12
How long does incorporation typically take
5 days
What form is submitted to name a company
IN01
What act regulates company names
Companies, limited liability partnerships and business (names and trading disclosures) regulations 2015
What goes in the IN01 form
Registered office, first directors, directors addresses, company secretary and address, first shareholders
What is a person with significant control
More than 25% shares and voting rights. Forms must state % of control
What act governs LLPs
Partnership act 1890
What’s in a partnership agreement
Roles, decision making, financial contributions, methods of sharing profits and losses, ownership of losses, dissolution of partnership, dispute resolution clause
What regulation governs LLP agreements
LLP regulations 2001
What regulations govern LLP persons of significant control
LLP (register of people with significant control) regulations 2016
What do shareholders do
Changing articles of association, changing name, directors cannot reverse decisions
What are the types of shareholder resolutions
Ordinary and special
At what notice can a general meeting be called
14 days
What rights do shareholders have when voting
Right to send a proxy to a general meeting on their behalf
Right to a poll vote
Right to receive notice of general meetings
Right to requisition a general meeting
Right to apply to the court to call a general meeting
Right for a shareholder with 5% of more of the voting rights in the company to require the circulation of a written statement with respect to any resolution
Right for shareholders holding 5% or more of the company’s shares to require the company to circulate a written resolution and accompanying statement.
What is a written resolution
The written resolution will include information on the ordinary and/ or special resolution which the board is proposing.
Shareholders will have to sign and return the written resolution if they wish to vote in favour of it.
As per section 291(2) of the CA, written resolutions must be circulated to every eligible member.
What protection is there for minority shareholders
Unfair Prejudice Actions (s994 CA’2006)
Any shareholder may apply to the court by petition for an order on the following potential grounds:
• The company’s affairs have been conducted in a manner that is unfairly prejudicial to the interests of the members generally, or some part of its members.
• An actual or proposed act or omission of the company is or would be prejudicial.
What is a derivative claim
derivative claim is instigated by a shareholder for a wrong done to a company which has arisen from an actor omission of a director. A derivative claim may only be brought in relation to a cause of action arising from an actual or proposed act or omission involving negligence, default, breach of duty or breach of trust by a director.
When can a general meeting be
called?
At any point, and any number of times in a year so that members can pass resolutions. Must also comply with any requirements outlined in its articles of association.
Who can call a general meeting
Directors and company secretary (if this is authorised by the directors)
Who is entitled to receive notice of a general meeting?
The members, directors and auditors. Also worth checking the company’s articles as well.
What information should a notice of general meeting contain?
Date, time, place and general business of the meeting.
What articles govern board decisions
Articles 7-16 of the Model Articles govern board decisions. Article 7 provides for two methods of decision making by the director
What internal records must be kept up to date for a company
• Register of members (registers are also known as statutory books). • Register of directors
• Board minutes for every meeting which takes place
• Minutes of every general meeting
• Record of the outcome of any written resolutions.
What must be kept up to date with company’s house for a company
• Public information regarding directors, shareholders and significant decisions. • Must notify the Registrar of Companies when certain decisions are made.
• Copies of all special resolutions must be filed at Companies House.
• Some ordinary resolutions must also be filed.
