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IMC Unit 1 > Legal Concepts > Flashcards

Legal Concepts Flashcards

1
Q

What is a Legal person?

A

Has rights, protections, privileges, responsibilities, and liabilities under law

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2
Q

What is a Legal personality?

A

Allows one or more persons to act as a single entity for legal purposes and can shield participants from personal liability

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3
Q

What is a power of attorney?

A

A legal document allowing a donor/giver to give a donee/recipient the power to make decisions on their behalf

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4
Q

What does LPA stand for

A

Lasting power of attorney

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5
Q

What is a property and affairs LPA

A

Gives the recipient the ability to make decisions about the giver’s FINANCIAL AFFAIRS

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6
Q

What is a personal welfare LPA

A

Gives the recipient the ability to make decisions about the giver’s PERSONAL HEALTHCARE AND WELFARE

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7
Q

Who do LPAs need to register with?

A

Office of the Public Guardian

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8
Q

Define Contract

A

An agreement creating and defining the obligations between two or more parties

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9
Q

What is meant be offer and acceptance in contracts?

A

Specific terms and conditions set out and accepted with no further negotiation

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10
Q

What is meant by consideration in contracts?

A

Something of value passing between the parties, e.g. one promises to provide a service and the other promises to pay

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11
Q

What is meant by intention in contracts?

A

Intention of the agreement to become legally binding, assumed in commercial contracts

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12
Q

What can make a contract not legally binding?

A

If the Ts and Cs are unclear

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13
Q

What are the potential conditions for a contract ending?

A
  1. PERFORMANCE: obligations accomplished by both parties
  2. AGREEMENT: both parties agree to end contract
  3. FRUSTRATION: completion of contract impossible
  4. BREACH: one party does not fulfil T&Cs - damages can be awarded to innocent party
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14
Q

What is legal property ownership?

A

Person is named on title documents e.g. Land Registry

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15
Q

What is beneficial/equitable property ownership?

A

Person has beneficial rights of ownership e.g. use of property

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16
Q

Conditions of co-ownership as tenants in common?

A
  • Joint owners own a SEPERATE SHARE
  • Share passes to beneficiaries on death
17
Q

Conditions of co-ownership as joint owners?

A
  • Joint owners have an IDENTICAL INTEREST
  • Interest passes to remaining owner on death
18
Q

Define insolvency

A

A situation when a COMPANY cannot pay its debts

19
Q

Define bankruptcy

A

ANYONE can apply to the LAW to become bankrupt
Companies are placed into ADMINISTRATION

20
Q

What value must debt exceed to declare bankruptcy?

A

> £5,000

21
Q

Who can request bankruptcy?

A

The debtor voluntarily, or the creditor petitions the court for an enforcement officer

22
Q

What is a will?

A

Written document setting out how a deceased person’s estate is to be distributed

23
Q

Conditions for a valid will:

A

Written
Signed and Witnessed
Person is >18, mentally sound, and not under pressure

24
Q

Define probate

A

Process of establishing ownership of deceased person’s estate before assets are distriuted

25
Q

What happens if a person dies without a will?

A

Estate distributed according to laws of intestacy

26
Q

Define trust

A

Arrangement allowing a ‘settlor’ to have assets controlled by ‘trustees’ for the benefit of the ‘beneficiaries’

27
Q

What is a bare trust?

A

Trustee holds property for a single beneficiary
Beneficiary has absolute interest
Assets held in trust until beneficiary reaches 18

28
Q

How does interest work in possession trusts?

A

Beneficiary has life interest - immediate income from/use of trust property
Reversionary interest held by remainderman

29
Q

What is a discretionary trust?

A

Arrangement whereby trustee has power to accumulate and/or make distributions to beneficiaries at their own discretion.

30
Q

What is a charitable trust?

A

Arrangement promoting a charitable purpose - must be of a charitable nature and for the benefit of the public.

31
Q

What are the terms of the Trustees Act 2000

A

Trustees can make ANY KIND of investment
They must obtain ADVICE
Must understand SUITABILITY and need to DIVERSIFY

32
Q

To whom does the Trustees Act 2000 not apply to?

A

Does not apply to: occupational pension schemes, authorised unit trusts, certain schemes under Charities Act

IMC Unit 1 (6 decks)

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