FUNDRAISING: PROPRIETARY COMPANY FUNDRAISING: PUBLIC COMPANY FUNDRAISING: MISLEADING INFORMATION IN DISCLOSURE DOCUMENTS...
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1 Inhalt SEPARATE LEGAL ENTITY: LIABILITY OF COMPANY FOR CLAIMS OF OWNER/EMPLOYEE... 3 SEPARATE LEGAL ENTITY: PERSONAL LIABILITY OF OWNERS... 4 SEPARATE LEGAL ENTITY: EXISTANCE OF COMPANY WITHOUT DIRECTORS... 5 SEPARATE LEGAL ENTITY: LIFTING OF CORPORATE VEIL... 6 SEPARATE LEGAL ENTITY: LIFTING OF CORPORATE VEIL IN CORPORATE GROUPS... 7 PROMOTERS: CONSIDERATION... 8 PROMOTERS: LIABILITY FOR PRE-REGISTRATION CONTRACT... 9 PROMOTERS: FIDUCIARY DUTIES (SECRET PROFIT) CONSTITUTION: CONTRACT BETWEEN COMPANY AND MEMBERS CONSTITUTION: CONTRACT BETWEEN COMPANY AND DIRECTORS CONSTITUTION: OBJECT CLAUSE DIRECTORS: CONSIDERATION MEMBERS POWERS TO MANAGE COMPANY COMPANY S LIABILITY UNDER CONTRACT COMPANY S LIABILITY IN TORT COMPANY S LIABILITY IN CRIME MEMBERS MEETING: ABILITY TO CALL MEETING MEMBERS MEETING: IRREGULARITIES MEMBERS MEETING: REMOVING DIRECTORS DIRECTORS: DUTY OF CARE DIRECTORS: DUTY TO AVOID CONFLICT OF INTEREST (e.g. SECRET PROFIT) DIRECTORS: RELATED PARTIES TRANSACTION DIRECTORS: DUTY TO PREVENT INSOLVENT TRADING DIRECTORS: DUTY TO ACT FOR PROPER PURPOSE DIRECTORS: DUTY TO ACT FOR PROPER PURPOSE IN RELATION TO SHARE ISSUE MEMBERS REMEDIES: EXPROPRIATION OF SHARES MEMBERS REMEDIES: DERIVATIVE ACTION MEMBERS REMEDIES: OPPRESSION MEMBERS RIGHTS: ACCESS TO BOOKS CAPITAL MAINTENANCE: SHARE BUY-BACK AND REDUCTION OF CAPITAL CAPITAL MAINTENANCE: DIVIDENDS OUT OF DEBT
2 FUNDRAISING: PROPRIETARY COMPANY FUNDRAISING: PUBLIC COMPANY FUNDRAISING: MISLEADING INFORMATION IN DISCLOSURE DOCUMENTS PRIORITY OF CHARGES EXTERNAL ADMINISTRATION WINDING-UP VOIDABLE TRANSACTIONS
3 LIABILITY OF COMPANY FOR CLAIMS OF OWNER/EMPLOYEE Check any exceptions Is <a company> liable for injuries of <owner/employees>? Can <owners of a company> claim payment of debentures? - SOLOMON S CASE states that a company is a separate legal entity different from its owners or managers. <XYZ> is a registered company and therefore a separate legal entity different from <its owners>. As such, <XYZ> has full legal capacity to contract: there is an employment contract between <XYZ> and <its owner/employee> since <owner/employee> is an employee of <XYZ>. The courts do not regard <XYZ> and <its owner/employee> as one due to the concept of separate legal entity. Since <owner/employee> was injured during work, XYZ is liable for these injuries. <XYZ> is a registered company and therefore a separate legal entity different from <its owners>. As such, <XYZ> has full legal capacity to contract: there is debenture contract between <XYZ> and <its owner/employee> since <owner/employee> holds debentures of <XYZ>. The courts do not regard <XYZ> and <its owner/employee> as one due to the concept of separate legal entity. <XYZ> is liable for injuries of <owner/employees>. <owners of a company> can claim payment of debentures. 3
4 PERSONAL LIABILITY OF OWNERS Check any exceptions Are owners of a company personally liable for debts of the company? - SOLOMON S CASE states that a company is a separate legal entity different from its owners or managers. <XYZ> is a registered company and therefore a separate legal entity different from <its owners>. The courts do not regard <XYZ> and <its owners> as one due to the concept of separate legal entity. Creditors cannot hold <owners> of <XYZ> personally liable for debts of the company. 4
5 EXISTANCE OF COMPANY WITHOUT DIRECTORS Check any exceptions Does a company still exist if all of its directors die? - SOLOMON S CASE states that a company is a separate legal entity different from its owners or managers. <XYZ> is a registered company and therefore a separate legal entity different from <its directors>. The courts do not regard <XYZ> and <its directors> as one due to the concept of separate legal entity. Even if the directors of a company die, the company remains in existence until it is deregistered since it is a separate legal entity. 5
6 LIFTING OF CORPORATE VEIL Check any exceptions: - Avoidance of legal obligation (GILFORD MOTOR LTD v HORNE) - Involvement in director s breach of duty (GREEN+CLARA v BESTOBELL) Can a person create a company to escape liability? - SOLOMON S CASE states that a company is a separate legal entity. - The courts enforce the concept of separate legal entity however they are prepared to lift the corporate veil in certain exceptions as in case of avoidance of legal obligation as in GILFORD MOTOR LTD v HORNE. <A person> created a new company by registration and sold <the asset> to the company as a separate legal entity. Since <the person> does not own <the asset> anymore, he/she will default on the contract. However, the courts are prepared to ask why the company was created. <The person> created the company to avoid his/her legal obligation (give reasons why he/she would do that). The courts in this case lift the corporate veil and regard <the person> and <XYZ> as one. <The person> will still be liable. 6
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