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Year 5 > Company Law Forms Of Business Association > Flashcards

Company Law Forms Of Business Association Flashcards

1
Q

What are the forms of business associations?

A

Sole proprietor
Partnership
Registered Trustees
Company corporation

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2
Q

As regards Sole proprietorship what are the characteristics?

A
  • The sole proprietor owns the whole business
  • liable for the debts incurred
  • has total control over the company
  • bears the risk of the business
  • take the whole profits
  • and upon death the business dies
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3
Q

Does a sole proprietor need to register to a public registry?

A

A sole proprietor need not register any info on their operations or financial affairs to a public registry

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4
Q

As regards Partnership

What led to the arising of partnership?

A
  • The need to raise capital

- Provision of continuity

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5
Q

What does partnership entail?

A

2 or more persons pooling their resources together so as to do business

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6
Q

What is the purpose of partnership?

A

To make profit

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7
Q

Does a partnership need to register their financial and membership matters at a public registry

A

They need not register

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8
Q

What is the law governing partnership in the East and North?

A

The Partnership Act 1890

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9
Q

What is the law governing Western Nigeria?

A

The Partnership Law of Western Nigeria 1959

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10
Q

What is the laws governing Partnership in Lagos

A
  • Partnership Law of 2005

- Partnership (Amendment) Law of 2009

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11
Q

Why can a state make law on Partnership?

A

Because Partnership is on the concurrent list of the CFRN

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12
Q

Law for companies is on which list?

A

Exclusive list

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13
Q

What did Lagos state provide in their law different from all other states?

A

Introduction of limited liability partnership

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14
Q

What did Lagos state deal with in terms of partnership?

A

General partnership
Limited partnership
Limited Liability Partnership

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15
Q

Which section of the Partnership Law of Lagos defines partnership?

A

Section 3

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16
Q

What was the definition of partnership in the law?

A

A relationship existing between 2 or more persons (partners have the right to participate) who carry on business in common with a view to make profit

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17
Q

What is the maximum number of partners?

A

20

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18
Q

Who partake in profit sharing?

A

All partners

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19
Q

In section 4 partnership doesn’t merely exist because ?

A

because of joint tenancy, tenant in common or by sharing of gross return

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20
Q

Exist because of what also?

A

Receipt of share or profits is prima Favour evidence of him being a partner

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21
Q

What is a collection of partners called?

A

A firm

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22
Q

Who is a partner to the firm?

A

An agent with actual/ apparent authority

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23
Q

Which section provides rules determining the interests of partners in the firm as well as their rights and duties

A

Section 25 Partnership Law

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24
Q

The first right/duty

A

Entitled to share equally in profits

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25
Q

2.

A

Must contribute equally

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26
Q

3

A

Entitled to be indemnified

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27
Q

4

A

Interest at rate of 5% for payment beyond agreed amount of capital

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28
Q

5

A

Not entitled to interest on capital toll profit are ascertained

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29
Q

6.

A

Entitled to partake in management subject to limited partners

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30
Q

Can partners take an action against themselves?

A

Yes

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31
Q

When will a partner not be able to take action?

1.

A

When no partner’s right has been infringed

32
Q

2.

A

Where what is being challenged by minority partner is an issue which has already been decided by the majority

33
Q

Which authority supports this?

A

Foss v Harbottes

34
Q

Are partners liable for debt/ obligations incurred?

A

They are jointly liable for all debts/ obligations of the firm

35
Q

Does this liability terminate upon death of a partner?

A

No it doesn’t

36
Q

Can a partner be liable for acts done before he became partner?

A

No

37
Q

What happened in Foss v Harbotte

A

The members of company sued the defendant directors for misapplying company profit.

38
Q

What was held? And what rules were developed?

A

The action failed and

  1. Proper plaintiff rule and
  2. Majority rule principle were developed
39
Q

Kind of partnership include?

A

General partnership
Limited partnership
Limited Liability partnership

40
Q

As regards general partnership what do partners do

A

They act on behalf of others

41
Q

If a one partner incurs expenses what happens

A

He incurs it on the behalf of all of them

42
Q

In this type of partnership the registration of the business name is under?

A

Part B CAMA

43
Q

As to limited partnership

What is the maximum number of partners?

A

20

44
Q

What does it consist of?

A

Consist of one or more persons called general partners who are liable for all debts/ obligations of firm and
One or more personals called limited partners who won’t be liable for debts/ obligations of firm beyond current amount agreed to be contributed and have actually contributed at time of entering the partnership

45
Q

Who must this partnership be registered with?

A

Must be registered with Registrar of limited partnership

46
Q

If not registered by the registrar what happens

A

It automatically becomes a general partnership

47
Q

As regards limited liability partnership, where is this partnership only available in?

A

Partnership (Amendment) Law of Lagos

48
Q

What section?

A

Section 58 to 84

49
Q

S.58(2)

A

Limited liability

50
Q

Is a limited liability partnership a separate legal person?

A

Yes

51
Q

By what section?

A

S.58(4)

52
Q

What does limited liability partnership entail?

A

If the business incurs liability such liability is limited to assets of the partnership and not that of the partnership

53
Q

What was the English concept of limited partnership

A

There must always be at least one partner beating weight of liability to the extent of his personal assets

54
Q

What is another inhibiting factor of limited partnership

A

He doesn’t have distinct corporate personality separate from individual partners

55
Q

Another feature of LLP

A

Has a corporate legal personality which can sue and be sued

56
Q

Who are partners to the firm?

A

Agents of the firm but are not capable of binding other partners

57
Q

As regards Registered Trustees

Who are trustees?

A

They hold real/ personal property for the benefit of beneficiaries

58
Q

Real benefit of property accrues to?

A

Beneficiaries

59
Q

What is a registered trustee partnership about?

A

A trust used to enable unwieldy bodies and associations to attain corporate status

60
Q

Which statute regulates this type of partnership?

A

Part C CAMA

61
Q

What does the statutes provide?

A

Provides for a community, association, club or group to be registered as Registered Trustees for the pursuit of the object of the association or group so configured

62
Q

What does section 26 CAMA provide?

A

A company with object to furthering some educational, scientific, ecclesiastical or other charitable object must be registered as a company limited by guarantee

63
Q

What does this provision mean?

A

The organization isn’t strictly viewed as a trust but rather a company

64
Q

What will then apply to the organization ?

A

The provisions of CAMA relating to operation, supervision, investigation and winding up of companies

65
Q

This trust structured organization under CAMA derives legal regulations from 5 places
1?

A

CAMA provisions

66
Q

2.

A

Constitution of organization

67
Q

3.

A

Provision of Trustee Investment Act 1962

68
Q

4.

A

Principle of Company Law and Equality formulates by courts on status, roles , duties, and responsibilities of trustees

69
Q

5.

A

Internal rules, bye laws , code of conducts and operational manuals

70
Q

What statute defines Incorporate Trustee?

A

Section 590 CAMA

71
Q

What is Incorporate Trustee according to that section?

Two definitions

A

Where one or more trustees are appointed by any community of persons bound together by custom, religion, kinship or nationality or
Any body or association of persons established for any religious , educational, literary, scientific, social, development, cultural, sporting or charitable purpose, he or they may, if so authorized by such community / body/ association apply to the commission .. as a corporate body,

72
Q

Is an incorporated Trustees a legal entity

A

They are and they can sue and be sued

73
Q

Incorporate Trustee is a perfect example of what?

A

A corporate aggregate

74
Q

What is a corporate aggregate?

A

A collection of individuals united into one body under a special denomination, having perpetual succession, under artificial form, and vested by policy of law with the acting capacity in several aspects as an individual

75
Q

What section list people that can be disqualified from being trustees?

A

Section 592 CAMA

76
Q

Who are disqualified from being trustees?

A

Infants
Persons of unsound mind
Undischarged bankrupt
Convicted of fraud/ dishonesty

77
Q

Duties and responsibilities of Trustees

1.

A

Must perform his obligations

Comply with the terms of the trust deed s

Year 5 (12 decks)

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