Agents without principals: pre-incorporation contracts and section 36C of the Companies Act 1985

Legal Studies ◽  
1993 ◽  
Vol 13 (2) ◽  
pp. 241-253
Author(s):  
Andrew Griffiths
Keyword(s):  
Common Law ◽  
Company Law ◽  
Good Case ◽  
Natural Person ◽  
Legal Effect ◽  
The Common ◽  
Artificial Nature ◽  
A Company

The problems associated with pre-incorporation contracts are due to the essentially artificial nature of a company’s existence and personality. The existence of a company, unlike that of a natural person, is not something which can be readily ascertained but is a matter of legal formality. There is a good case for treating pre-incorporation contracts as sui generis, but until 1973 their legal effect was governed by common law principles of contract and agency which drew little distinction between companies and natural persons. The result was unsatisfactory and widely criticised, one commentator remarking that ‘it is rare to hear such a widespread and common opposition against any aspect of English company law’. Section 9(2) of the European Communities Act 1972 (now to be found in s 36C of the Companies Act 1985) made a partial reform of this law, but did not deal with the inability of a newly formed company to ratify or adopt a pre-incorporation contract made on its behalfeven though this was a major deficiency of the common law.

10. Company law II: directors, finance, and capital

2019 ◽  
pp. 143-159
Author(s):  
James Marson ◽  
Katy Ferris
Keyword(s):  
Common Law ◽  
Company Law ◽  
Public Companies ◽  
Essential Information ◽  
Minority Protection ◽  
Company Directors ◽  
The Common ◽  
The Law ◽  
A Company

Each Concentrate revision guide is packed with essential information, key cases, revision tips, exam Q&As, and more. Concentrates show you what to expect in a law exam, what examiners are looking for, and how to achieve extra marks. This chapter discusses the law governing company directors and shareholders. The common law duties on directors have been codified and expanded through the Companies Act (CA) 2006. Directors are responsible to the company itself, not to individual shareholders. Minority protection (of shareholders) is provided through the CA 2006 to restrict directors’ acts that may unfairly disadvantage them. Public companies must have a company secretary and they must satisfy statutory requirements in relation to their qualifications. Shareholders have no automatic right of management in the company although, through attendance and the rights to vote at shareholder meetings, they may have influence over the business conducted.

scholarly journals The protection of environmental interests through corporate governance: A South African company law perspective

2015 ◽  
Vol 11 (2) ◽  
pp. 8-20
Author(s):  
Anthony O. Nwafor
Keyword(s):  
South Africa ◽  
Sustainable Development ◽  
Corporate Governance ◽  
South African ◽  
Common Law ◽  
Company Law ◽  
The Common ◽  
Corporate Administrators ◽  
Environmental Interests

The quest to maximize profits by corporate administrators usually leaves behind an unhealthy environment. This trend impacts negatively on long term interests of the company and retards societal sustainable development. While there are in South Africa pieces of legislation which are geared at protecting the environment, the Companies Act which is the principal legislation that regulates the operations of the company is silent on this matter. The paper argues that the common law responsibility of the directors to protect the interests of the company as presently codified by the Companies Act should be developed by the courts in South Africa, in the exercise of their powers under the Constitution, to include the interests of the environment. This would guarantee the enforcement of the environmental interests within the confines of the Companies Act as an issue of corporate governance.

10. Distributions and maintenance of capital

2019 ◽  
pp. 252-281
Author(s):  
Derek French
Keyword(s):  
General Principle ◽  
Common Law ◽  
Court Cases ◽  
Share Capital ◽  
Capital Transfer ◽  
The Common ◽  
A Company

This chapter examines the controls imposed on return of a company’s capital to its members, first by considering the common law general principle that return of capital to shareholders is illegal unless permitted by statute. It then discusses the problem of how to distinguish between a legal distribution of profits and an illegal return of capital; transfer of profits to a capital redemption reserve and use of profits to pay up bonus shares; company’s issuance and redemption of redeemable shares or purchase of its own shares; purchased shares as treasury shares; and how a company may reduce its issued share capital by special resolution. The chapter also looks at capitalisations and employees’ share schemes. It includes analysis of three court cases that are particularly significant to distributions and the maintenance of capital.

3. The constitution of the company

2020 ◽  
pp. 43-60
Author(s):  
Lee Roach
Keyword(s):  
Common Law ◽  
Essential Information ◽  
The Common ◽  
A Company

Each Concentrate revision guide is packed with essential information, key cases, revision tips, exam Q&As, and more. Concentrates show you what to expect in a law exam, what examiners are looking for, and how to achieve extra marks. This chapter discusses the company constitution. A company’s constitution consists primarily of the articles of association and agreements and resolutions affecting the company’s constitution. The constitution forms a statutory contract between the company and its members, and between the members themselves, but only those provisions relating to membership rights will constitute terms of the statutory contract. A company can alter its articles by passing a special resolution, although statute and the common law restrict a company’s ability to alter its articles.

The Concept of a Meeting and Quorum

2020 ◽  
Author(s):  
Leslie Kosmin ◽  
Catherine Roberts
Keyword(s):  
Common Law ◽  
Orderly Fashion ◽  
The Common ◽  
The Creation ◽  
Regular Manner ◽  
A Company

The need to hold a meeting will arise in many different and diverse situations. All meetings are subject to procedural rules and regulations of the particular institution that has convened the meeting. The reason why there are rules and regulations is so that the participants at a duly convened meeting can transact business in a lawful manner and so that they will be able to debate and discuss issues in an orderly fashion. This book is concerned with the meetings of solvent companies that are registered and incorporated under the statutory provisions regulating companies. The reason for the requirement for meetings under the Companies Act 2006 (CA 2006) is so that the members can attend either in person or by proxy in order to debate and vote on matters affecting the affairs of a company. There are a number of procedures, some that are derived from the common law and others that are the creation of statute, that have to be observed in order for a meeting of a company to transact business in a lawful and regular manner.

Service of Process in England on Overseas Companies and Article 5(5) of the Brussels Convention

1999 ◽  
Vol 48 (4) ◽  
pp. 921-936 ◽  
Author(s):  
Nelson E. Enonchong
Keyword(s):  
Great Britain ◽  
Common Law ◽  
General Rule ◽  
Brussels Convention ◽  
English Court ◽  
Natural Person ◽  
The Law ◽  
Special Rules ◽  
Article 5 ◽  
A Company

It is generally accepted that, in actions in personam, the foundation of the court's jurisdiction at common law is the service of process.1 To this extent the rules as to service define the limits of the court's jurisdiction. So, for a claimant to establish the jurisdiction of the English court over an overseas company2 he must be able to serve process on the company in accordance with the rules of service. The general rule is that an overseas company, like an individual, may be served with process in England if present within the jurisdiction.3 However, since a company is only a legal (not natural) person, it cannot be present in the same way as an individual. It has therefore been necessary for special rules to be laid down by which it can be determined whether or not an overseas company is present in England and therefore may be served with process here. Before 1992 those rules were contained in sections 691 and 695 of the Companies Act 19854 (the pre-1992 regime). However, in 1992 the law was amended and a separate provision was laid down in section 694A of the Companies Act 1985 to regulate the service of process on any overseas company with a branch in Great Britain (the 1992 regime).

The Companies Ordinance (Amendment) (No. 17) Law: Effects on the Alteration of the Objects Clause in a Company Memorandum

1982 ◽  
Vol 17 (2) ◽  
pp. 169-196
Author(s):  
Zipora Cohen
Keyword(s):  
Legal Status ◽  
Common Law ◽  
Company Law ◽  
Good Faith ◽  
Special Procedure ◽  
A Company ◽  
Do So

The Companies Ordinance (Amendment) (No. 17) Law, 1980, (hereinafter referred to as Amendment no. 17) has fundamentally reformed the legal status of the objects clause of a company memorandum. It is no exaggeration to say that this amendment constitutes the greatest reform effected in company law in Israel up to the present day.English Common Law regarded the objects clause as defining the capacity of the company, and not only the powers of those acting on its behalf. This approach, formulated at a time when it was impossible to alter the objects clause of the memorandum persisted even after the English legislature relented somewhat and permitted the objects to be altered, albeit with certain restrictions and according to a special procedure. This is still the approach in England today: the objects of the company are viewed as determining its capacity, and therefore, an act done in deviation from the objects is considered void, and cannot be ratified by the company, even if all the members wish to do so. At the same time, the European Communities Act 1972, affords protection to people transacting with the company in good faith, even in the case of a deviation from the objects (sec. 9(1)).

scholarly journals Impact of the Constitution's Normative Framework on the Interpretation of Provisions of the Companies Act 71 of 2008

2019 ◽  
Vol 22 ◽  
pp. 1-24
Author(s):  
Christa Rautenbach ◽  
Brighton M Mupangavanhu
Keyword(s):  
Common Law ◽  
Social Science Research ◽  
Science Research ◽  
Company Law ◽  
Bill Of Rights ◽  
Commercial Law ◽  
Normative Framework ◽  
The Common ◽  
Research Questions ◽  
The Republic

Given the intention of section 7(a) of the Companies Act 71 of 2008 (the Act) to promote compliance with the Bill of Rights in the interpretation and application of company law in SA, this article assesses the extent to which the Act actually does this. The article thus seeks to showcase evidence of the Act's intentional alignment with the normative framework of the Constitution of the Republic of South Africa, 1996 (the Constitution). The paper does this by answering the question: what are the implications of the Constitution's normative framework on the interpretation and application of the Act? The term "normative framework" is defined, and a distinction is drawn between the descriptive and explanatory social science research questions and the legal research questions which are evaluative and normative in nature. The article provides examples of the contexts in which the intentional alignment of the Act with the Constitution's normative framework is evident. To this extent, commentary is made on the following selected issues: remedies to facilitate the realisation and enjoyment of rights established by company law; the direct and indirect horizontal application of the Bill of Rights to provisions of the Act; and a discernible court's duty to develop the common law as necessary to improve the realisation of the rights established by the Act. A point is made in the article that judicial decisions involving the application of company law must be justified by reference to a cohesive set of values from the Bill of Rights. This is part of transformative constitutionalism. It demands that even commercial law principles should no longer be blindly accepted simply because precedent says so, or for the reason that it is expedient for the purposes of commercial certainty. The article argues that the Act permits the direct horizontal application of the Bill of Rights on its provisions in two stated ways. It is also argued that the Act permits the indirect application of the Bill of Rights through the development of the common law where it is deficient in promoting the spirit, purport and objects of the Bill of Rights. The development of the common law, it is argued, is vital for producing an incremental and cohesive body of constitutionalised common law in the company law context.

scholarly journals A COMPARISON OF THE COMMON LAW BASED DUTY WITH ITS CIVIL LAW EQUIVALENT

2020 ◽  
Author(s):  
Azamat Omarov ◽  
Asylbek Kultasov ◽  
Kanat Abdilov
Keyword(s):  
Common Law ◽  
Civil Law ◽  
Comparative Law ◽  
Case Law ◽  
Legal Systems ◽  
Legal Structure ◽  
Legal Term ◽  
Legal Effect ◽  
The World ◽  
The Common

The article discusses the features of civil law in different countries. The authors studied the origins of the modern tradition of civil law, comparing the legal systems of two European countries. One of the traditional classifications of duties in civil law is analyzed, the conclusion is made about the inappropriateness of the allocation of personal and universal duties. In comparative law, there are many situations where the same legal term has different meanings, or where different legal terms have same legal effect. This confusion most often occurs when civil lawyers have to deal with common law, or vice versa, when common law lawyers deal with civil law issues. While there are many issues which are dealt with in the same way by the civil law and common law systems, there remain also significant differences between these two legal systems related to legal structure, classification, fundamental concepts, terminology, etc. As lawyers know, legal systems in countries around the world generally fall into one of two main categories: common law systems and civil law systems. There are roughly 150 countries that have what can be described as primarily civil law systems, whereas there are about 80 common law countries. The main difference between the two systems is that in common law countries, case law – in the form of published judicial opinions – is of primary importance, whereas in civil law systems, codified statutes predominate.

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