Janet Dine, Marios Koutsias. Company law CONTENTS

Transcription

1 Janet Dine, Marios Koutsias. Company law CONTENTS Preface Table of cases Table of Statutes and Directives xiii xiv xxvi 1 The reasons for forming companies The elements of a company Outsiders 'Parent' and 'subsidiary' company Single member companies 6 Hot Topic: Corporate governance 7 Summary 7 Case note 8 Exercises 10 2 Starting a company Limited and unlimited companies Public and private companies Minimum capital requirements for a public company Change of status from public to private company and vice versa Groups The memorandum of association and registration Incorporation Duty of Registrar Off-the-shelf companies 19 Hot Topic: Community interest companies 19 Summary 19 Exercises 20 3 Corporate personality The legal basis for the separate personality doctrine Problems caused by the personality doctrine and exceptions Statutory intervention Lifting the veil Fraud Groups The criminal and civil liabilities of companies What crimes? Why convict companies? Identification of the company's alter ego Civil liability 41 Hot Topic: Performance of Companies and Government Departments (Reporting) Bill (2004) (1) 42 Summary 43 Case notes 43 Exercises 44

2 4 The memorandum of association Ultra vires - the old law Constructive notice Justification of the doctrine How to determine whether an act is ultra vires The new law Ratification The old case law Objects and powers Ultra vires and objects Knowledge by an outsider that a transaction is outside objects or powers Can borrowing ever be an object? s cases 55 Summary 58 Exercises 58 5 The articles of association The articles as a contract What rights are governed by the contract in the articles? Outsiders Entrenched provisions The articles as evidence of a contract Alteration of the articles of association Bona fide for the benefit of the company Remedies 71 Summary 73 Case notes 73 Exercises 74 6 Power to represent the company Power of directors to bind the company Protection Transaction and dealing Decided on by the directors Good faith Unauthorised agents Usual authority Promoters Who are promoters? Duties of promoters Disclosure The loss of the right to recission Actions for damages Remuneration of promoters Pre-incorporation contracts Liability of the company 89 Summary 89 Exercises 90

3 7 Public issue of securities Shares Direct offers, offers for sale, issuing houses The two regimes Rights offers and public offers Placing Pre-emption rights Authority to issue shares Directors' duties The structure of the rules Admission to Stock Exchange Listing Contents of listing particulars Continuing obligations Remedies for defective listing particulars Prospectus issues Remedies for defective prospectuses Liabilities for misstatements in prospectuses and listing particulars The EC Prospectus Directive 101 Summary 102 Case notes 103 Exercises The regulation of investment business Financial Services and Markets Act 'regulated business' How the range of regulatory tools is used in practice Financial Services Authority: authorisation provisions Complaints The Investment Services Directive 116 Summary 116 Case notes 117 Exercises Maintenance of capital Fundamental rule Payment of money to members Distributions Rules governing distributions Dividends Public companies Members' liability Other permitted payments to members Reductions of capital Interests of creditors Procedure Bonus shares Redeemable shares Purchase of own shares Illegal transactions Serious loss of capital by a public company 134

4 9.17 Accounts Company accounts FRSs and FREDs The obligation to prepare accounts Keeping the records Duty to prepare individual company accounts and 'true and fair view' Group accounts Conclusion 139 Summary 140 Exercises The balance of power inside the company: corporate governance Proxy voting Solicitation of proxies Formality of procedure Meetings Management of the company Appointment of directors Removal of a director Validity of directors' acts Disqualification Directors' meetings Managing director Relationship between the board of directors and the general meeting Where the board of directors ceases to function The Secretary Employees 162 Hot Topic: International debate on corporate social responsibility 164 Summary 165 Case notes 166 Exercises Directors' duties: the general duties The Cadbury, Hampel and Combined Code initiatives Duty owed to the company What is the company? Duties of care and skill 192 Hot Topic: Performance of Companies and Government Departments (Reporting) Bill 2004 (2) Fiduciary duties Are the prohibitions absolute? The categories of duties Consequences of a breach 211 Hot Topic: Performance of Companies and Government Departments (Reporting) Bill 2004 (3) 211 Summary 212 Case notes 213

5 Exercises Specific duties of directors Disqualification of directors Insider dealing 233 Summary 242 Case notes 243 Exercises Suing the company, suing for the company, enforcing directors' duties Suing the company Suing for the company (the exceptions to the rule in Foss v. Harbottle and derivative actions) Ratification The statutory remedy in section Unfair prejudice The relief that can be granted Winding-up orders When a winding-up order is likely to be made Department of Trade investigations When inspectors have been appointed Following investigations 271 Summary 272 Case notes 272 Exercises Shares Ordinary shares Preference shares Voting rights The exercise of voting powers Variation of class rights Alteration of articles to insert a variation clause Statutory right to object 287 Summary 288 Exercises Lending money and securing loans Debenture-holders' receiver Fixed and floating charges The characteristics of fixed and floating charges Crystallisation of the floating charge Legal and equitable charges Floating charges and other claims against the company Retention of title clauses Registration of company charges Which charges are registrable? Salient points Delivery of particulars and priorities 298

6 15.12 Priorities under the registration scheme Effect of registration Duty to register and effect of non-registration Payment of money secured by unregistered charge 300 Summary 300 Case note 301 Exercises Takeovers, reconstructions and amalgamations Public offers Monopolies The Takeover Panel General principles and rules Partial offers Compulsory purchase provisions Sell-out right Reconstructions Meetings Approval of the court Reconstruction in a liquidation 307 Hot Topic: International takeovers 308 Summary 311 Case note 311 Exercises Insolvency Voluntary arrangements Proposal The involvement of the court Contents of the proposal Meetings Challenges Administrative receivership Liquidations Voluntary winding-up The liquidator Order of payment of debts Avoiding antecedent transactions Fraudulent trading Summary remedy against delinquent directors - Section 212 Insolvency Act Wrongful trading The destination of the money Dissolution 323 Summary 324 Case notes 324 Exercises 330

7 18 The effect of the EU on English company law The making of a Directive The extent of the influence of EU rules Sources of EU law The institutions of the EU The EU Company Law Harmonisation Programme 337 Hot Topic: The European Company Company Law Directives Securities regulation Insolvency Conclusion 348 Hot Topic: Takeover Directive 350 Summary 351 Exercises Transglobal corporations and world development Development issues The displacement of domestic production The effects of the international money and banking systems The undermining of political systems and the absence of control of transnationals Environmental issues Labour law issues 361 Hot Topic: Saro-Wiwa family v. Royal Dutch/Shell 361 Bibliography and further reading 364 Index 368