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Return to Company Law Concentrate 5e Student resources
It is a prudent step to have in place, before the partnership begins trading, a written partnership agreement setting out the rights and obligations of the partner. Bearing this in mind, which ONE of the following statements is not true?
If a written partnership agreement exists, the implied terms contained in the Partnership Act 1890 will not form part of the partnership agreement.
If a written partnership agreement does not exist, then the terms implied by the Partnership Act 1890 will form terms of the partnership agreement.
If a written partnership agreement exists, the terms implied by the Partnership Act 1890 will still form part of the agreement, except where they are inconsistent with the agreement.
The terms implied by the Partnership Act 1890 can be excluded by the partnership agreement.
Companies in the UK are principally regulated by...?
The Companies Act 1985
The UK Corporate Governance Code
The Companies Act 2006
The Listing Rules
Concerning a company's liability, which ONE of the following statements is true?
A company cannot be convicted of a crime that requires proof of
A company will not be found liable for the acts of its directors - the directors will be personally liable instead.
A company will only be vicariously liable for the acts of its employees if the employee was sufficiently senior within the company.
Where liability requires a level of knowledge, the liability of employees and directors can be attributed to the company.
Chandler v Cape plc
, did the Court of Appeal pierce the corporate veil?
Regarding the statutory set of model articles, which ONE of the following statements is NOT true?
If a promoter does not register any articles, the model articles will act as the company's articles.
Only companies incorporated under the Companies Act 2006 may be governed by the new model articles.
The model articles do not cover unlimited companies and such companies must register their own articles.
Even if a promoter does register its own set of articles, the model articles will form part of the company's articles, unless the registered articles modify or exclude them.
Regarding the constitution's status as a statutory contract, which ONE of the following statements is NOT true?
The courts will not rectify the statutory contract if it contains a mistake.
The statutory contract is not defeasible on the grounds of misrepresentation, undue influence or duress.
The terms of the statutory contract can be altered by the company against the wishes of minority shareholders party to it.
Breach of any term in the statutory contract will allow either the company or a member to sue for breach of contract.
Every company must appoint at least one director. True or False?
Regarding the duty to promote the success of the company, which ONE of the following statements is true?
The directors are required to give equal weight to the interests of the company, its shareholders, its employees and any other relevant interests.
Where the interests of the company and its shareholders conflict, preference should be given to the interests of the company.
The interests of the company are always the same as the interests of its shareholders.
The duty to promote the success of the company is objective, meaning that what the directors actually believed is irrelevant.
What is the notice period for the annual general meeting of a public company?
Twenty-one clear days.
Twenty-one clear days, unless the articles provide for a longer period.
Fourteen clear days.
Fourteen clear days, unless the articles provide for a longer period.
What is a 'quorum?'
The minimum number of 'qualifying persons' required in order to validly conduct business.
A meeting that lacks a chairman.
The maximum number of persons who may attend a meeting.
A meeting that is invalid because sufficient notice has not been provided.
Which ONE of the following would not be described as an institutional investor?
Employees holding shares through an employee share scheme
Which corporate governance report focused specifically on non-executive directors?
The Cadbury Report
The Greenbury Report
The Hampel Report
The Myners Report
The Smith Report
The Higgs Report
Regarding the company's power to allot shares, which ONE of the following statements is NOT true?
Where a private company only has one class of share, the power to allot shares is vested in the directors.
Any authorization given to allot shares can only last for a maximum of five years.
The directors of public and private companies that have more than one class of share can only allot shares if they are authorized to do so by the articles, or by a resolution of the company.
Any authorization given to allot shares must state the maximum number of shares that can be allotted under it.
As any authorization given to allot shares can effectively amount to an indirect changing of the articles, such authorization can only be revoked or varied by the passing of a special resolution.
There are limitations on the issuing and redemption of redeemable shares. Which ONE of the following is NOT an actual limitation?
Redeemable shares cannot be issued if the only shares that the company has issued are redeemable shares.
Redeemable shares can only be redeemed if they are fully paid-up.
When redeeming shares, the company must pay fully for them at the time of redemption, unless the terms of redemption provide for a later date.
Private companies can only issue redeemable shares if their articles so provide.
What is the difference between a derivative action and a derivative claim?
The term 'derivative action' refers to causes of action vested in a member personally, whereas 'derivative claims' relate to causes of action vested in the company.
The term derivative action referred to a member's ability under the common law to enforce a right belonging to the company, whereas the germ 'derivative claim' refers to the member's ability to commence proceedings under the Companies Act 2006 for wrongs done to the company.
The term 'derivative action' refers to claims brought by the company for wrongs done to the members, whereas a 'derivative claim' is a claim brought by a member for wrongs done to the company.
A derivative action could not be brought in cases of negligence, whereas a derivative claim can be brought in cases involving negligence.
Which ONE of the following is unlikely to result in the company being wound up on just and equitable grounds?
Where the directors engage in negligence.
Where the company is fraudulently promoted.
Where the company is deadlocked.
Where the company cannot fulfil the purpose for which it was set up.
Where the directors display a lack of probity.
Which ONE of the following statements describes the difference between a members' voluntary winding up and a creditors' voluntary winding up?
If a majority of the directors make a declaration of solvency, the winding up will be a members' voluntary winding up. If no such declaration is made, it will be a creditors' voluntary winding up.
A creditors' voluntary winding up is commenced by the creditors, whereas a members' voluntary winding up is commenced by the members.
A members' voluntary winding up is commenced by passing a special resolution, whereas a creditors' voluntary winding up does not require a special resolution.
Which ONE of the following does NOT have the right to petition the court for a compulsory winding-up order?
A member of the company.
Any creditor of the company.
The Secretary of State.
The directors of the company.
An official receiver.
The auditor of the company.
The company itself.
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