Law CBE Flashcards
1
Q
William is married to Wahida and they have one child, Harry. William gives his investment property to Wahida for life, and
thereafter to Harry absolutely.
- What kind of trust is this?
- What is Harry called?
A
- Fixed interest trust
2. Remainderman
2
Q
Can a public company have
a) just one member
b) just one director
A
a) yes
b) no, 2 at least
3
Q
An employer is required by statute to give an employee certain key information in writing, eg details of remuneration and
notice arrangements.
This information must be provided:
A
Within a usual time limit of two months from commencement of employment
4
Q
A tenant’s lease has expired and the tenant is still in occupation of the property. The tenant remains liable for rent and the
landlord may claim possession of the premises at any time.
This situation is known as what?
A
A tenancy at sufferance
5
Q
In certain circumstances, an employer may be liable for the acts of an employee committed in the course of employment.
This is known as:
A
Vicarious liability
6
Q
Titus is about to buy a property with his girlfriend Sadia and they will hold it as joint tenants.
Titus’s solicitor told him that there are ‘four unities’ when property is acquired in this way
A
unities of
a) possession
b) interest
c) title
d) time
7
Q
A person receiving a gift under a Will is known as a:
A
Legatee
8
Q
‘A public company must have a ……………………………………………….before it can obtain its trading certificate.’
A
minimum allotted share capital of £50,000 (of which at least one quarter is paid up, plus the whole of any premium)
9
Q
Tony, who recently died, wrote a will but never got round to signing it. He intended to leave £1M to his wife Cleo and the
remaining £300,000 to their three grown-up children in equal shares.
What will Cleo inherit?
A
£250,000 (plus interest from the date of death), personal chattels, and half the residue of the estate
10
Q
What are debenture holders?
A
Debenture holders have a contractual relationship with the company
The debenture contract will contain the terms under which the loan has been agreed
11
Q
Which one of the following documents is not always needed when applying to form a company?
A
B Articles of Association
12
Q
For Enterprise Investment Scheme (EIS) relief, the word ‘issue’ in relation to shares means which of the following?
A
Unissued shares are applied for, allotted and finally registered
13
Q
Jacob orders twenty sheep from Woolly Ltd. Ten sheep are delivered with a note of apology that these were the only ones
available.
A
a) Jacob can send the ten sheep back without paying anything
b) If Jacob accepts the ten sheep, he must pay a reasonable price
c) Jacob may wish to accept the sheep as partial performance
14
Q
If a person makes a concurrent will, this means that:
A
There are two valid wills in place at once
15
Q
Under EU Law the Policy areas of the EU are classified by the TFEU into one of three categories.
Which are the three categories?
A
Exclusive competence
Supporting competence
Shared competence
16
Q
Which of the following are among the UK’s three legal jurisdictions?
A
England and Wales
Northern Ireland
Scotland
17
Q
The doctrine of precedent is also known as
A
stare decisis
18
Q
Binding precedent is also known as
A
ratio decidendi
19
Q
Name types of extra-statutory material published by HMRC?
A
Statements of Practice
Tax Bulletins
Press Releases
20
Q
Byron is planning to purchase the shares of a publishing company. He has become concerned that the business may have
some undisclosed debts.
What should Byron ask to be included in the contract for sale to protect him if this is the case, so that he could seek
compensation without necessarily having to prove loss?
A
An indemnity
21
Q
Kelly recently purchased a house in the Midlands. She owns a driveway to the property which a neighbour has a right of
access over.
Who is the dominant and who the serviant tenant?
A
Kelly serviant
Neighbour dominant
22
Q
Tiina, a Finnish citizen, is seeking to enforce her rights under the EU Treaty (the TFEU).
Legal action by Tiina against a business with which she has been dealing would be an example of:
A
Horizontal direct effect
23
Q
Many taxes provide for exemptions or special rules based on an individual’s marital status.
How does this apply to CGT and IHT?
A
For CGT purposes, transfers of assets between spouses/civil partners who are living together in a tax year take place at no
gain/no loss
For IHT purposes, transfers of assets between UK spouses/civil partners are exempt
24
Q
Penny and Amy entered into a general partnership to provide hairdressing and beauty therapy treatments from premises in London. It is now coming to the end of the Partnership’s first financial year and Penny and Amy are concerned that they comply with their legal obligations.
Complete the following sentence ‘Penny and Amy’s accounts need……………………………………… the size of their
A
not be in prescribed form nor is an audit necessary whatever
25
Jane wrote a book called ‘Tax planning for individuals’. Jane was born in 1970 and died in 2010.
When will copyright in her book last until?
31 December 2080 (70 yrs after authors death)
26
Which two of the following is it not compulsory for a company to maintain?
A register of debenture holders
| A register of disclosed interests in shares
27
When a beneficiary enjoys their interest for as long as someone else is alive, this is known as...?
an interest our auto vie
28
Functions of the Crown
To formulate policies
To protect the realm
To conduct the administration of the government
29
What is true for a patent in regard to infringement of intellectual property rights?
There is an agreement that the licensor will not sue for any infringement of intellectual property rights
30
Is it possible to register a private limited company?
No
31
Grant of probate can only be obtained from the Probate Registry, which is part of the:
High Court
32
Under the Wills Act 1837, for a written Will to be valid, which formalities will need to be adhered to?
The Will must be signed by the testator
Signature must be witnessed by two persons
The testator must be present when the witnesses sign the Will
33
What is true in regard to partnership debts?
New partner will not be liable for debts which arose before she joined the partnership
New partner must share payment of the office rent from the date she joins the partnership unless the partnership agreement states otherwise
34
Gerontius dies without making a Will. He is survived by his wife Angela and 17-year-old son Edward. Gerontius has no brothers or sisters and his parents are both deceased. What interest do Angela and Edward have?
Angela will have an absolute interest in half the residue
Edward will have an interest in half the residue
Edward`s entitlement will initially be held on trust
35
Miss Groves wishes to settle a large house on her nephew, Sebastian. She is concerned that Sebastian, who used to have a gambling problem, may sell the house if he runs into difficulties again. She would like to think that if Sebastian ever has children, the house would still be in the family in case he wished to pass it on to them.
Which two types of trust might be suitable for Miss Groves to set up in this situation?
A protective trust
| A flexible life interest trust
36
Delegated legislation is voluminous and drafted by unelected civil servants. It is therefore important that it should be controlled adequately.
Which are ways in which Parliament retains control over delegated legislation?
The negative resolution procedure
| The affirmative resolution procedure
37
The nature of the UK constitution may be described how?
It is a monarchical constitution
It is an uncodified constitution
It is a unitary constitution
38
What is an injunction?
remedy available for a claimant upon a breach of contract by the defendant
automatic
equitable
is an order to abstain from wrongdoing
39
What remedies are available for a claimant upon a breach of contract by the defendant?
Monetary compensation, specific performance or an injunction
40
Which two are not required of tax advisers under money laundering regulations?
To identify all their clients to the NCA
| To monitor their clients` compliance with the law
41
Skinny Ltd wishes to reduce its share capital to reflect the fact that its assets have fallen in value. It has sent out a notice of the meeting to all the shareholders. A meeting is scheduled for three weeks’ time at which the appropriate special resolution may be passed.
How long before this meeting must the directors' solvency statement be completed?
15 days
42
What is a discretionary trust?
A discretionary trust is the most flexible form of trust. It might be set up by a settlor who wishes property to be used for the benefit of a group of people, but does not specify the precise benefit for each individual member of the group.
43
What applies if a discretionary trust is exhaustive?
The beneficiary has no right to compel the trustees to make a distribution
The trustees must distribute the trust income
44
When a person first commences in business they might operate a business from their own home.
1) Is planning permission needed?
2) Will business rates need to be paid?
3) Will the title deeds need to be checked for any easements, as they might restrict activities that can be carried out on the premises?
1) yes
2) yes
3) no
45
example of bare trusts
David holds shares as nominee for Alan
46
Which of the following are fungible property?
Shares in a company
Milk quota in the dairy farming industry
both
47
One party to a contract cannot usually escape liability by saying that there was a mistake as to the terms of the agreement between the parties. However, ………………………………………….nullifies the contract and renders it void.
a fundamental mistake that was unknown to the parties
48
Wei has been offered the chance to subscribe for shares in a new company which is about to be incorporated, and which will be called Trevi Ltd. Wei is anxious to know what she would stand to lose if the company was wound up with debts unpaid.
Wei's liability:
Would be nil once her shares were paid up
49
Eunice benefits from being able to fish from a stream owned by Harold.
What is this called?
A profit à prendre
50
Rabitz UK Ltd has just finished its first year of trading. It has instructed its Accountants to complete the financial statements and wishes to know its filing obligations.
What is the standard time limit for it to file its accounts with the Registrar?
Nine months from the end of the company’s accounting date
51
Freddie, Eddie and Shazeem are shareholders in Rightso Ltd. The directors are looking to issue new shares in order to finance the acquisition of some new plant and machinery.
The rights of the existing ordinary shareholders to be offered new shares issued by the company are known as:
pre-emption right
52
Tax is payable by a legal entity. It is therefore essential to be able to identify legal entities. This necessity also arises because the entities may be media...
through which property is held
by which certain objectives are achieved
thorough which transactions are conducted
and which other one?
Vehicles adopted for the purposes of investment
53
What is true of preference shares?
Participating preference shareholders receive dividends at a fixed rate and then participate equally with other shareholders in any further dividend payable
Preference shares are a less risky investment than ordinary shares
54
Liquidation begins either by court order or by a resolution of members to wind up the company.
Are the following statements about a members' voluntary liquidation true or false?
This procedure is only open to solvent companies
A receiver will be appointed to conduct the liquidation
True; False
55
An LLP must be incorporated and registered. It is similar to a limited company and the partnership itself is ………………………………………………..
a corporate body with separate legal identity and unlimited liability for its debts
56
Member States are obliged actively to ensure that the functioning of the four freedoms of the internal market is secured in order for harmonisation to proceed. This obligation includes not adopting new legislation, and abolishing all national rules, that could possibly jeopardize the objectives of the Treaty.
EU Member States signing the Code of Conduct on Business Taxation are undertaking, for example, to eliminate existing tax measures seen as harmful under the Code.
This is known as:
Rollback
57
A dismissal is treated as caused by redundancy if the only or main reason is……………………………………….in which the employee was employed.
that the employer has ceased, or intends to cease the business
58
Which of the following, created by Brigade plc, must be registered within 21 days of creation with the Registrar at Companies House?
1) A guarantee given to a subsidiary
2) A charge on the company’s debtors
3) A charge on a trade mark owned by the company
2 and 3
59
A tenant signing a lease granted before 1 January 1996 would generally have liability for their own defaults and any defaults by which other tenants?
All future tenants under the same lease
60
Describe ‘substantive law’
It is the division of law that contains what is commonly understood to be the rules of law
61
What is true in relation to a contract of guarantee?
The contract is tri-partite
| Contract must be evidenced in writing
62
Desmond offered to sell his collection of rare teaspoons to Oladi on 1st March. Oladi agreed to buy them for £15,000. They agreed that they would complete the contract on 3rd March, when Desmond would hand over the teaspoons and Oladi would pay him the £15,000.
Desmond has since had second thoughts about completing the contract.
If Desmond refuses to carry out his contractual obligations, this is known as:
Repudating the contract
63
Citizens who were unable to obtain resolution of their grievances in the King’s common law courts petitioned the King to obtain relief by direct royal intervention. These petitions came before the King in council. In dealing with each petition his concern was to ……………....………………………. and then to impose a just solution.
Fill in the missing words.
establish the truth of the matter
64
Are the following statements true or false?
Equity offers automatic remedies
When equity conflicts with common law, equity prevails
False, true
65
Are the following statements true or false?
The Channel Islands are legal dependencies of the United Kingdom.
The Channel Islands are free to determine their own foreign policy.
true, false
66
types of classifications of law in the UK
A : Adjective Law
C : Public Law
E : Private Law
67
Which one of these is not a way in which a company can be created?
By a resolution of the House of Common
68
Which one of these is not a non-juristic person
A limited company
69
A question of fact is a question as to the existence of some phenomenon in the World around us. These phenomena.......................................
are proved either by direct evidence or by agreement by the parties to a dispute
70
Which one of the following has the sole power to levy taxation?
Parliament - the house of commons
71
Legitimate expectations do not arise where HMRC have given clearance to a taxpayer but...............……
retracted the clearance before the taxpayer has acted on it
72
How has the UK restricted a person’s ability to enter into tax planning arrangements?
Parliament has enacted targeted anti-avoidance legislation, for example, DoTAS
HMRC publish a list of anti-avoidance spotlights
73
Where a taxpayer is successful in judicial review proceedings, the court/tribunal may grant certain discretionary remedies.
Which are discretionary remedies they might give?
A : A Quashing order
B : A Mandatory order
D : A Prohibition order
74
Which of the following are true in relation to secondary legislatures in the UK?
1) The Privy Council is a secondary legislature
2) Local governments are a secondary legislature that make Orders
3) The Treasury is a secondary legislature that may make Regulations
1 and 3 only
75
Someone who is acting ultra vires is acting
outside their powers
76
What is true in relation to a Finance Bill?
C : Some tax changes may take immediate effect
| D : The Bill must pass through both Houses of Parliament
77
Parliament in the UK comprises...
the House of Commons, the House of Lords and the Crown
78
Are the following statements about Parliamentary Supremacy true or false?
Parliament can overrule case law
Parliament can repeal statutes made by a previous Parliament
true, true
79
Using the powers conferred by the treaties, the EU adopts a number of types of secondary legislation. Which one of the following describes the two main types of secondary legislation?
Regulations and directives
80
forms of primary legislation
Private acts
| Public acts
81
What is true in respect of the Supreme Court for the UK?
A : There is no right of appeal to the Supreme Court
C : The Supreme Court hears appeals only on points of law of public interest
E : The Supreme Court may hear appeals direct from the Upper Tribunal
82
3 examples of persuasive precedent
B : Obiter Dicta
C : Rationes decidendi of lower courts
D : Minority judgements
83
Tax practitioners will encounter decisions of the ........................ and the Court of Justice of the EU. These two courts are not part of the domestic hierarchy of courts in the UK.
Appellate Committee of the Privy Council
84
In relation to harmonisation of taxation, there are three main principles at play.
Which one of the following is not one of those principles?
free movement of goods
85
During the co-decision procedure for EU legislation, a proposal rejected by the European Parliament will go back to whom?
Council of the EU
86
Pablo is seeking to invoke a provision of EU law which has vertical direct effect. This would involve Pablo bringing an action against
The member state of which he is a citizen
87
Under the Data Protection Act 2018 and the GDPR, personal data must be handled properly. Data controllers must comply with seven principles of data protection.
```
Lawfulness, fairness and transparency
Purpose limitation
Data minimisation
Accuracy
Storage limitation
Integrity and confidentiality (security)
Accountability
```
88
Ned, a solicitor, advises Mr Alt to change his Will to make it more tax efficient. The advice is incorrect, and when Mr Alt dies, Miss Alt, his sister and sole beneficiary, is left with a larger, not smaller, inheritance tax liability.
action in tort
89
How may a joint tenancy be converted into a tenancy in common?
By mutual agreement of the joint tenants
By unilateral notice
90
A trade mark is a sign capable of being represented graphically which is capable of distinguishing goods or services of one undertaking from those of other undertakings. Rupert has recently registered a trademark for a three-dimensional shape.
What would this property be categorised as?
chose in action
91
Charlie has started up a landscape gardening business, Purple Patch. She is keen to protect her brand.
Which of the following might she be able to protect by means of a registered trademark?
1) the name of her business a type of lavender plant which is readily available,
2) which she incorporates into all the gardens she designs the particular purple and green colour combination she uses on all her
3) business communications, website and garden equipment
1 and 3 only
92
Igor has just finished composing a piece of piano music.
| When will copyright run from?
from the moment he created it
93
Xhung and Wei own a house together as joint tenants. Wei wants to sell her share in the house as she is leaving Xhung and emigrating abroad. Xhung does not want Wei to leave and has told her that she won’t be able to sell the property without Xhung’s permission.
Is Wei correct?
Xhung is incorrect as Wei can sever the joint tenancy by notice in writing to Xhung and convert it to a tenancy in common
94
In land law, a lease creates a leasehold estate and is also technically known as....
A terms of years absolut
95
Which of the following statements are true in relation to what is regarded as land for tax purposes?
Airspace above the earth
Naturally growing woodlands
both
96
Some contracts for the sale of goods between businesses provide that the seller continues to be the legal owner of the goods with legal ownership only passing when the goods are paid for.
This is called.................
a retention of title clause (or Romalpa clause)
97
Which terms may be implied into a contract between a tax adviser and his client for tax advice?
The Supply of Goods and Services Act 1982
98
Which of the following are duties of a Principal?
To obey lawful instructions
To pay the agent the commission agreed
To indemnify the agent for all acts he has done
2 only
99
Under s.67 CAA 2001, a lessee can ..................................................
ever become the owner of the machine under the terms of such a contract
100
A call option.....................
binds the grantor to sell an underlying asset and gives the grantee the right to require the grantor to sell the asset
101
Juno, who has been employed part-time at a hairdresser's for three years, is pregnant. Her employer says she will have to leave her job once her uniform stops fitting but she will be given her notice period.
Juno can make a claim for unfair dismissal
102
There is a statutory requirement under s.1 Employment Rights Act 1996 for employers to give employees………………………………………………………………..
written particulars of a number of their main terms of employment
103
Ann Fang has recently qualified as a dentist. She is about to start in practice as a sole trader, and needs a loan to buy equipment.
Which of the following would it be useful for her to offer her bank?
A charge over her home
A personal guarantee of any business debts, written and signed by her in front of a witness
charge only
104
When a partnership is dissolved, the partnership's assets are realised in which order?
External debts
partners` capital over and above original contributions
partners` original capital contributions
any excess to partners according to the profit-sharing ratio
105
Partners who retire continue to be liable for any outstanding debts incurred while they were partners, ……………………..........………….. They are also liable for debts of the firm incurred after their retirement if the creditor knew them to be partners before retirement and the creditor has not had notice of their retirement.
unless the creditor has agreed to release them from liability
106
Cora and Clarice, who are sisters, live together and run a cake shop at their home. They have no partnership agreement and no name for their business.
Are they in partnership?
The lack of a partnership agreement does not mean that they are not trading as a partnership
107
With which one of the following bodies may a power of attorney be registered in England so that it will survive if the donor ceases to have mental capacity?
The Public Guardian
108
primary duties of personal representatives?
Collect in the assets of the estate
Pay expenses of the estate
determine assets and liabilities of the estate
distribute the estate in line with the will/rules of intestacy
109
Which of the following are true in relation to Administrators of an estate?
They are a personal representative appointed by the Court
They derive their powers from the grant of probate
true, false
110
Henry's will currently bequeaths half of his estate to his wife, Catherine, and the rest to their daughter Mary. Henry has fallen out with Catherine and would rather live with Anne now.
Which three actions will render the bequest to Mary in Henry's current will ineffective?
Ripping up the only copy of his will
Marrying Anne
Writing a new will, which makes no reference to the previous one, but leaves his estate to Anne
111
Mike and his 11-year-old son Bobby have lived with Mike's girlfriend Carol for the last six years. Carol had separated from her husband several years before meeting Mike, but has never got round to getting a divorce. Carol has personal wealth in excess of £1M and has been paying for Bobby's football coaching and trumpet lessons.
If Carol were to die now without making a will, which three of the following would be true under intestacy rules?
Mike would inherit nothing
Carol`s husband would inherit at least £1M
If Carol`s husband were no longer alive, Carol`s parents would inherit her whole estate
112
If a person dies without making a valid will, or the residuary gift has failed, the estate is distributed, after payment of debts and taxes, according to the intestacy rules. The rules for the disposition of an intestate’s property are laid down in the Administration of Estates Act 1925 (as amended).
If there is no surviving spouse or civil partner, the whole estate is distributed in which one of the following orders?
Issue, Parents, Siblings, Half Siblings, Grandparents
113
Which one of the following is not an advantage or reason to set up a trust?
if somebody has a history of getting into financial difficulties, a fixed interest trust might be of benefit
114
There are three key pieces of legislation that govern trust law in England:
Trustee Act 1925
Trusts of Land and Appointment of Trustees Act 1996
Trustees Act 2000
115
The reversionary interest of a remainderman under an interest in possession trust may be
An absolute interest
| A contingent interest
116
When does a resulting trust arise?
This may arise where no person is expressly identified in the trust deed
117
Carly set up a trust for her grandchildren. She specified that it should be used for their benefit only, ideally to cover their educational costs.
What type of trust is this?
Discretionary trust
118
Clarence is drafting the deed to create an express private trust, the wording of which includes “something nice from my wine cellar for each of my children”.
What problem would there be with a trust deed drafted in this way?
Insufficient certainty of subject matter
119
Excluding trusts concerning land, what number of trustees may a trust have?
No minimum, no maximum
120
How much notice must a public company give of its Annual General Meeting if a resolution with special notice is required?
28 days
121
Monarch Ltd has only one subsidiary, Royal Ltd, of which it holds more than 50%. Royal has its own subsidiary, Knave Ltd.
What percentage of the voting rights does Royal Ltd need to have in Knave Ltd in order for Knave Ltd to count as a subsidiary of Monarch Ltd?
More than 50%
122
Once a company's constitution has been registered, which of the following are true?
The company and its members are contractually bound to each other
The individual members are contractually bound to each other
true, true
123
what is a dividend specie
has no cash
124
Kauf Ltd is planning to buy back some of its own shares using a permissible capital payment. The appropriate special resolution was passed today.
1) When do the shares need to be paid?
2) What do the auditors need to approve?
1) The shares need to be paid for within seven to nine weeks of the resolution
2) The auditors need to approve the latest monthly management accounts
125
What does a floating charge attach to and when does it crystalise?
A floating charge attaches to assets when it crystallises
| Cessation of the company`s trade would crystallise any floating charges
126
If a company pays a dividend without having sufficient distributable profits, who may have to make good the unlawful distribution?
The directors and shareholders
127
correct definition of distributable profits?
Accumulated realised profits less accumulated realised losses
128
From a legal perspective, a sale of shares is effected by the vendor and purchaser making and completing a contract of sale. To complete the contract...................................
the purchaser’s name must be entered into the company’s share register and that of the vendor removed
129
Zola has decided to sell her sole trader business to a rival competitor. Her friend Anika told her that she needed to be careful that she didn’t breach employment law with respect to the three employees in the business.
Which statement is correct about the law concerning Zola’s employees?
Zola can make her staff redundant prior to the sale, provided that the purchaser agrees
130
The sale agreement also usually provides for limitations to and exclusions from the warranties and indemnities. When the agreement is made, the vendor is likely to provide a disclosure letter which.................................
sets out the facts and circumstances that might constitute breaches of warranties
131
Vinnie is selling her business. The purchaser has asked for tax warranties to be included in the contract. Vinnie is not sure that she has understood the purpose of these.
Are the following statements true or false?
Tax warranties are more important in a sale of assets than in a share sale
Tax warranties protect the purchaser against an undisclosed problem in the business
false, true
132
In relation to a company which is winding up, the time limit for transactions at an undervalue is:
Two years preceding the winding-up resolution
133
Rubbish Ltd has gone into liquidation. The liquidator has realised the assets, which amount to £100,000. Happit Ltd has a fixed charge over one of the factories for £20,000. Happit Ltd also has a floating charge over Rubbish Ltd’s assets for a further £10,000. Babbit Ltd also has a floating charge over Rubbish Ltd’s assets for £30,000. HMRC is owed £80,000 and holiday pay to employees is £10,000?
How much money will HMRC get?
£30,000
134
Who may appoint a receiver if a company is in financial difficulties?
A fixed charge holder
135
describes a reconstruction?
Where all or part of the undertaking of a company is transferred to another person but in circumstances where there is no substantial change in the persons who are ultimately interested in the undertaking
136
The liquidator has to apply the realised assets in the following order:
1. Costs of liquidation
2. preferential creditors (wages, holiday pay, occupational pension, money borrowed to pay wages)
3. secured creditors with floating charges
4. unsecured creditors incl. HMRC
5. Shareholders
137
An amalgamation is
reverse of a reconstruction, involves bringing together of two or more undertakings from separate companies into one
138
A partition occurs
where a company is divided between two or more shareholders so that afterwards there is no substantial identity of shareholders in relation to each part of the undertaking has been partitioned
139
A partition may be effected by
a dividend in specie or by using part 26 companies act 2006
140
Tim, a tax practitioner was reported for Money Laundering and is being prosecuted by the Crown Prosecution Service. Sally, the victim of the crime, who suffered loss as a result of Tim’s actions is suing Tim personally for the loss that she has suffered.
What is the ‘burden of proof’ the State needs to convict Tim and what must Sally prove in her civil action?
Criminal Action: Beyond reasonable doubt & Civil Action: On a balance of probabilities
141
What is the maximum length of time for which a private company may exclude pre-emption rights?
Pre-emption rights may be permanently excluded
142
A ‘Ways And Means’ Resolution is needed to authorise the levying of taxes. Ways And Means Resolutions which relate to the Finance Bill are temporarily deemed to be included in the Act of Parliament and hence have the force of law until the time they are actually included in the Finance Act.
For what period of time are they deemed to be temporarily included in the Act?
7 months
143
When a company goes into liquidation, what kind of ownership does the liquidator have?
When a Liquidator is appointed they become the beneficial owner of the company’s assets
144
For each accounting reference period of a company the directors must prepare for the company which one of the following?
a balance sheet, a profit and loss account and group accounts where relevant
145
Helen has written a will leaving all of her assets in trust to her children.
What type of trust is this?
express trust
146
Jason died, leaving a surviving spouse, Hetty, an ex-wife, 2 children (aged 30 and 32) and 2 grandchildren. He left no will, and had an estate of £4.25m in cash and personal chattels of £750k.
How much are each of his children entitled to inherit under the Administration of Estates Act 1925?
£1m absolutely
147
Which statements are true regarding the trustees of an exhaustive discretionary trust?
The trustees have discretion as to whether or not to distribute the whole of the income
The trustees have discretion as to how any distribution should be allocated among the beneficiaries
false, true
148
All data controllers which process personal data about data subjects must be registered with the ICO. Failure to comply with the GDPR principles can attract a fine.
Which two of the following are ways in which the fine can be calculated?
Up to £17 million
| 4% of a business’s annual worldwide turnover
149
explain unincorporated association
They are said to be ‘transparent’. One ‘looks through’ the body to the component members
150
A company has a floating charge over an asset. It later registers a fixed charge over the same property.
In which three circumstances would the floating charge always take priority?
The floating charge holder included a negative pledge clause in the terms, which the fixed charge holder knew about
The fixed charge holder did know that the floating charge existed
The fixed charge was not properly registered
151
When do you need to register a lease with the Land Registry?
only need to register the lease with the Land Registry if it exceeds seven years
152
Which of the following statements are true in relation to the completion of a sale of land?
Depending on the price, the seller may have to pay stamp duty land tax (SDLT)
Any SDLT payable is due within 30 days of the effective date of the transaction
false, true
153
The Crown (also known as the Executive) has four main functions.
To formulate policies
To protect the realm
To oversee Parliament
Enforce the law
154
Kimi has been looking on the internet for a new restaurant. She sees one that she likes and books a table for the following night. Kimi walks into the restaurant and is seated by the waiter and given a menu.
Which one of the following best describes the actions by the waiter?
waiter is making an offer
155
What term in property law is often used to describe all property except freehold and leasehold land?
chattels personal
156
Which Article states that ‘Member States must not use the national tax regime to discriminate against goods coming from other Member States’?
110 TFEU
157
Which two of the following documents need to be sent to the Registrar in order to register the LLP?
Statement of compliance
| Incorporation document
158
Rules of intestacy:
| Those surviving are spouse, no issue, parent, brother, sister or issue thereof
Spouse absolutely
159
Rules of intestacy: those surviving are spouse and issue
Spouse takes:
1) personal chattels
2) £250,000 plus interest from date of death
3) half residue absolutely
Issue share other half of residue
160
Rules of intestacy
| Those surviving are spouse, no issue but parents
Spouse absolutely
161
Rules of intestacy: those surviving are spouse, no issue or parents but brothers or sisters of the full blood
Spouse absolutely
162
No spouse but issue
Issue take all absolutely
163
Rules of intestacy: those surviving are no relatives (issue, parents, siblings, half siblings, grandparents, uncles and aunts and issue half or full blood)
The crown, the duchy of Lancaster, the duchy of Cornwall
164
What are the different types of express private trusts?
Bare trust
Interest in possession trust (=fixed interest trust)
Discretionary trust
165
Types of interest in possession trusts
Life interest trust - beneficiary enjoys their interest in possession for their own life (life interest and life tenant)
Interest pur autre vie - beneficiary enjoys interest for so long as someone else is alive
Fixed interest - beneficiary otherwise enjoys their interest for a fixed period of time or until a certain event happens)
166
Advantages of trusts
- Tax planning
- Prevent immediate control over the property from passing onto the intended beneficiary
- retain control while giving away the capital and income
- ensure property is dealt with in particular way in the future
- set up trust now but decide in future who should benefit from it
- protect family wealth - flexible interest trust
- protective trust for someone with history of getting into financial difficulties
- hold property for those incapable of holding it themselves
- conceal benefit of interest (bare trust)
- benefit employees (most pension schemes)
- charitable or educational purposes
167
How is property categorised in English law?
realty or personalty
168
What are realty and personalty?
Realty: freehold land
Personalty: devised into chattels real and chattels personal
169
What are chattels real and chattels personal
Chattels real; leasehold land
| Chattels personal: devided into chattels in possession (tangible) and chattels in action (intangible)
170
Does the administrator have to be a licensed insolvency practitioner?
Yes
171
Can the company be wound up as long as an administration order is in place?
no
172
True or false: A trust arises when beneficial and equitable ownership in property are not vested in the same person?
False
173
True or false: Equitable ownership vests in the beneficiary?
true
174
‘Land’ is defined in the Interpretation Act 1978. It includes...
Complete the sentence with the definition from the Act.
buildings and other structures,
land covered with water and
any estate, interest or right in or over land
175
Resolution needed to change company name
special resolution >75%
176
Edward is 75 years old and is making a Will. He does not want to leave his estate outright to his wife Bella, as he is concerned that she will fritter the money away.
His friend Tag told him that he could set up a trust as part of his Will which would allow the income from all of his estate to go to Bella for life, and then on Bella’s death, the estate would pass to their daughter Nessie.
What type of trust would need to be created to ensure that Edward’s wishes were satisfied?
fixed interest trust
177
must be registered within 21 days of creation with the Registrar at Companies House?
A charge on the company’s debtors
| A charge on a trade mark owned by the company
178
For the purposes of capital gains tax, share capital may be re-organised in which three situations?
```
Where class rights are varied
There is a reduction in the company’s share capital The nominal value of the shares is altered
```
179
A patent gives a monopoly right over inventions which satisfy a number of criteria:
Functional
New
Has industrial use
180
Registered patents may be protected for up to ? Years. In that time the registration must be renewed every ? Years.
20 years
| 5 years
181
What rights does a trademark offer?
Monopoly rights in a sign which is capable of being represented graphically and of distinguishing good or services of one undertaking of those of another.
182
Trademarkable signs may consist of
```
Designs
Names
Words
Letters
Numerals
The shape of goods
Sounds
```
183
Trademarks can only be registered in respect of
Particular goods or services or classes of goods or services
184
How long do registered trademarks protect?
10 years and registration can be renewed for a further 10 years
185
Intellectual property right is an example of
A chose in action
186
Prevention rights take two forms:
Monopoly right
| Anti copying right
187
What is a copyright?
An anti copying right in an authors literary, artistic, musical and other works.
188
There are also a number of intellectual property rights associated with copyright, mainly rights over databases, moral rights and rights in performance. These are known collectively as...
Neighbouring rights
189
What is regarded as land?
```
Physical soil
Natural produce of soil e.g. woodland
Airspace above earth
Building
Ground covered with water
Estates, interest and intangible rights in or over land
```
190
Other term for freehold estate
Fee simple
191
What is a freehold estate vs leasehold estate?
A period of time without an end vs period of time of defined duration
192
Wrongful dismissal
Employees contract of employment comes to an end as a result of a breach of contract by their employer
193
Unfair dismissal occurs where
- the procedure for dismissal was not fair
| - the reason for dismissal was not fair
194
Automatically unfair reasons include:
```
Discrimination
Trade union membership
Compulsory retirement
Jury service
Pregnancy
```
195
What is fungible property?
It is made up of individual units where each unit is identical and the particular units can’t be identified
196
Examples of fungible property
```
Sugar
Flour
Shares in a company
Money in the bank
Milk quota
```
197
What is a juristic person?
Not human being
Created by law and exist in law only
E.g a Company
198
A special resolution is required in order to change the Articles of a company. The company secretary must file a copy of the resolution with Companies House within a prescribed time limit.
A special resolution requires:
14 days` notice, a majority of 75% and filing within 15 days
199
Howard, Raj and Bernadette are members of Svelte Ltd. Svelte Ltd was set up five years ago and has share capital of £60,000. Howard, Raj and Bernadette wish to reduce the company's share capital to £45,000.
By what means can this be achieved?
Special resolution and a directors’ solvency statement
200
Jason died, leaving a surviving spouse, Hetty, an ex-wife, 2 children (aged 30 and 32) and 2 grandchildren. He left no will, and had an estate of £4.25m in cash and personal chattels of £750k.
How much are each of his children entitled to inherit under the Administration of Estates Act 1925?
£1m absolutely
201
Sylvester has recently taken over as company secretary of a busy trading company. He is finding his duties more complicated than he had hoped. There are two special resolutions sitting on his desk which were passed at a general meeting last week. The directors passed him both special resolutions the day after the meeting.
How much time does Sylvester have to file them at Companies House?
within 15 days of being passed
202
In tax matters, how is delegated legislation made?
Statutory instrument
203
The law laid down in an earlier decision of the courts that is followed in a later case is known as the...
ratio decidendi
204
Where a person has been given permission by the occupier of land to do something which would otherwise be unlawful in respect of the land of another person, they have been granted a...
license
205
Grant buys a car. He lends it to his brother Simon.
Simon is away on business and his wife, Claire, is currently using the car.
In terms of ownership and possession
C
| Grant owns and Claire possesses
206
True or false: A payment in respect of a restraint of trade clause in an employment contract is always subject to income tax
true
207
True or false: The principal must notify a third party in writing that the agent has the power to bind the principal
false
208
Farouk wishes to sell an old laptop for £350. He places an advert online.
Sophie sends him a question asking for the technical specifications and the price.
After Farouk replies, Sophie tells him she will pay £200 for the laptop.
When is the offer made?
Sophie made an offer when she told Farouk the price that she would pay
209
Rajit tells Nick that Simon is acting on his behalf in respect of the sale of Rajit's house.
As a result, Nick enters into a contract with Simon to purchase Rajit's house.
Based on this information, which one of the following describes the authority with which Simon is acting?
apparent authority
210
Which of the following statements are correct?
1. The contract will be terminated without breach if Amelia and Park Ltd agree that Amelia only needs to give three months notice.
2. The contract will be terminated without breach if Park Ltd dismisses Amelia without notice but pays her a PILON.
both
211
Sheila dies leaving a valid Will, but there are no executors able to act.
Jenny agrees to act as personal representative.
What grant of representation is issued to Jenny?
Grant of letters of administration with will annexed
212
When a couple divorces, the court can issue an order to allow the minor children of the couple to remain in the family home.
This type of order is known as...
Mesher order
213
"I leave Betty half of my holding of shares in Bigcan plc".
| what kind of legacy is this?
The bequest to Betty is a specific legacy
214
Dave settles property on discretionary trust for Tilly and Sanjay.
The trust will end in 20 years' time.
Choose the correct option to complete the following statement.
The remainderman of the trust is...
Dave
215
Is a nominee entitled to dividends?
No
216
When will the vendor and purchaser usually draw up Heads of Agreement?
Between the purchaser making an offer and the vendor accepting it
217
The company has agreed a voluntary arrangement.
Which two may challenge the arrangement?
Shareholder and creditor
218
The primary legislatures of the uk are
Parliament and the pivy council
219
There are 5 key secondary legislators in the uk
```
Pivy council
Ministers of the crown
Government departments
Local government
Professional bodies
```
220
Acts of uk parliament may be classified according to their
Application or their purpose
221
Acts of uk parliament may be classified according to their purpose as follows:
```
Declaratory act
Amending act
Enabling act
Consolidation act
Rewrite act
Codification act
```
222
Formal steps that have to be followed by the house into which a bill is introduced
```
First reading
Second reading
Committee stage
Report stage
Third reading
```
223
Explain negative resolution process
Statutory instrument will be annulled if either house passes a motion calling for its annulment within 40 days including the day on which it was laid out
224
Explain affirmative resolution procedure
Statutory instrument has to be approved by resolution of both houses before it takes effect
225
Sub-categories of affirmative resolution procedure
- draft affirmative procedure ( ldraft to be laid out and approved)
- made affirmative procedure (instrument can be made and come into effect but won’t stay in effect unless approved by both houses within 1 month)
226
All statutory instruments must be considered by
The joint select committee on statutory instruments
227
An order OF Council is an example of ...
| An order IN council is an example of ...
... primary legislation
| ... secondary legislation
228
Parliament may not enact legislation without...
Royal ascent
229
Court hierarchy of revenue law
Supreme Court (not bound by own decision)
Court of appeal (bound by previous decision with exemptions)
Upper tribunal (tax and chancery chamber) (not bound by own decisions)
First tier tribunal
230
In which circumstances is the court of appeal not bound by previous decisions?
- two conflicting decisions
- court of appeal ruling does not stand with later ruling of House of Lords
- if satisfied that earlier decision was wrongly decided (=per incuriam)
231
Examples of persuasive precedent
```
All orbiter dicta
Rationed decidendi of lower courts, other common wealth systems
Dissenting judgements
Minority judgements
Writings of authors of repute
Reports of law reform bodies
```
232
Reversionary lease
Lease that takes effect within 21 years of the date it is granted. Person owns the lease but can’t move in yet
233
Is there VAT on leasehold estate?
No, sale of leasehold estate is exempt from vat because leasehold estate is different from fee simple
234
Which contracts must be in writing?
Sale of land and sale of shares
235
Zu enters into a two year hire purchase agreement. When does he become the owner of the assets?
Immediately for capital gains tax purposes and properly once he decides to purchase the asset
236
When does the right not to be unfairly dismissed arise?
Once employee has 2 continuous years of service
237
The partners in an LLP who have responsibility for the firms compliance requirements are calls
Designated members
238
Stages of divorce proceedings
Petition
Response
Decree nisi
Decree absolute
239
In terms of a divorce how long do the no gain/loss for CGT and IHT exemption apply?
CGT until end of tax year in which couple separates
| IHT until decree absolute
240
X makes a will to leave Y his VW car (reg number xxx) but does not own the car when he dies. What does Y receive under the will?
Nothing because legacy fails by reason of ademption
241
What is a donatio mortis cause?
Gift of an asset that occurs while person is alive but takes affect only upon their death
242
A reversionary interest under a trust is the interest of the...
Remainder man who is
- named in the trust deed or
- who is the settlor if nobody named as remainderman
243
Who is the legal owner of a trust property?
Trustee
244
The specific duties of trustees are..
- act within powers
- protect trust property
- invest in trust property
- act impartially between beneficiaries
- keep true and accurate accounts
- distribute income and capital to beneficiaries
- not to profit personally
- not to purchase property from trust
245
Which trusts must be created in writing?
Land
| Settlement of existing trust interest on trust
246
A trust settled on or after 6th April 2010 cannot last for more than
125 years
247
Constituting a trust is completed on
The vesting of legal title of the trust property in the trustees by the settlor
248
Trustees may not pay the income of the trust to...
The remainder man because their interest is capital only
249
Trustees cannot advance capital to a
Life tenant as they have an interest in income only
250
When do the TUPE regulations apply?
Where the company’s employees are transferred to the purchaser as part of the business as a going concern
251
A breach of trust arises where...
Trustee fails to carry out their duties in accordance with the terms of the trust instrument or the law
252
Which category does leasehold land fall into?
Chattels real
253
Consideration could be defined as
Sth of value given by one person to create a contract with another
254
A company limited by guarantee needs to do the following in respect to its article of association
Needs bespike articles but doesn’t need to be submitted to companies house
255
Can tax legislation treat a sole trader as being separate from their business?
Yes
256
How to register a trademark?
Trademarks act 1994
257
What does a partnership agreement cover?
```
Name
Date
Capital
Profit
Meetings
Restrictions
Admission
Death or retirement
Bookkeeping
Indemnity
Dispute resolution
```
258
Offences under fraud act 2006
False representation
Failure to disclose information
Abuse of position
259
How is cheating the public revenue governed?
Theft act
