Legal Personalities - 10%

Question 1

Sole trader

Answer 1

Sole traders also known as sole practitioners own and run businesses which are not legally distinct from the owner

Question 2

Partnership

Answer 2

A partnership is the relation which subsists between persons carrying on a business with a view of profit

Question 3

Companies

Answer 3

Companies are legal entities, separate from the natural persons connected with them, for example their memebers

Question 4

Salomon vs co ltd

Answer 4

There salmon case established that a company is a separate legal entity from its owners

The fact that a company is a separate legal entity gives rise to many of its characteristics

The most important characteristic is limited liability for its members

The company is able without limit for its own debt

Members of the company do not usually have to pa the debts of the company if it fails but members will have to pay many money still owed from purchasing their share or under a guarantee

Question 5

Statutory examples of lifting the veil

Answer 5

Liability for trading without a training certificate ( public )

Fraudulent and wrongful trading

Disqualified directors

Abuse of company names

Question 6

Case law examples of lifting the veil Gifford motor co v home

Answer 6

To prevent evasion of;
- legal obligations
- liability taxation

Question 7

Case law examples of lifting the veil Daimler co ltd vs continental tyre

Answer 7

Recognise alien enemy character of a company

Question 8

Case law examples of lifting the veil adams v cape industries plc

Answer 8

Groups ( agent, single economic entity, facade )

Question 9

Case law examples of lifting the veil r v oll ltd

Answer 9

Identify the controlling mind of a company in cases of company manslaughter

Question 10

Case law examples of lifting the veil ebrahimi v Westbourne galleries

Answer 10

Quasi - partnership

Question 11

Incorporated businesses

Answer 11

• members liability is usually limited
• may have any number of members at least 1
  -Perpetual succession
• members own transferable shares
• the company owns its assets
• may sue/ be sued in own name
• may offer security of a floating charge over assets

Question 12

Unincorporated

Answer 12

• less formality when forming and running the business
  -Less publicity - no need to file accounts
• less expensive to run - no audit required
• no restrictions on withdrawing capital