A Corporate Constituency Statute Corporations

The corporation is a complex set of contracts, and corporate law enables the participants to select the optimal arrangement for the many different sets of risks and opportunities that are available in a large economy. No one set of terms will be best for all; hence the "enabling" structure of corporate law.

In the 1800s, state corporation laws assisted in the creation of corporate boards, who could govern, much like state congresses, without unanimous consent of shareholders. This made the running of corporations much more efficient. As time passes, corporate boards seem to be gathering more and more power, particularly with the inception of large mutual funds and similar cash-building entities, which place another layer of organization between stakeholders and corporate governors.

For the purposes of this assignment the relevant law is the Corporations Act 2001 (Cth) (either as the “Act” of the “CA”). From now on I will refer to it as the Act (Hinchy, McDermott 2008).

Corporations, presently, are legal citizens in the United States. This legal citizenship guarantees all Corporations many of the legal rights that natural born citizens can enjoy with limited consequences for their actions. Presently since the law sees Corporations as “artificial citizens” many of the punishments for crimes committed by a Corporation are essentially null and void since these entities cannot cordially be punished for committing a crime as a physically living human can.

1. Determine at least three different internal and external stakeholders that Dr. DoRight might have to deal with on a daily basis at the hospital.

The three largest malls in the Detroit area are within 15 miles of the proposed location, Tower Center Mall, the Fairlane Town Center, and the New Center One which houses over 300 stores, allowing consumers will find a large variety of options.

One of the reasons why a corporation may prefer NTSE as opposed to NASDAQ is because when listed on a regional exchange, NASDAQ limits the amount of capital that the corporation may access in case it needs one. Additionally, when a corporationis listed on a national exchange, it enjoys that prestige factor. NYSE is mostly an auction market that uses floor traders in most of its operations with specialists who facilitate and oversees all trades for a certain stock. On the other hand, NASADAQ is not a physical entity but an over the counter market (OTCM) that mostly relies on market makers to facilitate trading. Thus, the former employs marketing specialists whereas the later does not. Further, there is a sort of perceived prestige factor when a corporation moves from NASDAQ to NYSE. It is because NYSE has restrictive requirements for a corporation to qualify to be listedon the exchange. NASDAZ is not an auction market but a communication network that uses computers to distribute information about stocks to buyers and sellers. Thus, many people prefer NYSE over NASDAQ because the former is more informative and easy to use. Personal assistance is also guaranteed when using NYSE.

The concept of a company being a separate legal entity is the most striking illustration in separating the company from its owners. A paramount principle of corporate law is that no shareholder or member of a company is made liable for the obligations incurred by such incorporations A company is different from its members in the eyes of law. In continuations to this the opposite also holds true in the sense that neither can the company be held liable for the acts of its members. It is a fundamental distinction that a company is distinct from its members.

Absolutely key in this endeavour are the leadership of the chairman of a board, the support given to and by the CEO, and the frankness and openness of mind with which issues are discussed and tackled by all directors. 4. The challenge should not be underrated. To run a corporate board successfully is extremely demanding. Constraints on time and knowledge combine with the need to maintain mutual respect and openness between a cast of strong, able and busy directors dealing with each other across the different demands of executive and non-executive roles. To achieve good governance requires continuing and high quality effort. 5. The Code’s function should be to help boards discharge their duties in the best interests of their companies. In recent reviews of the Code, the FRC has focussed on changing the “tone” of the Code by making limited but significant changes to signal the importance of the general principles which should guide board behaviours. It is to be hoped that these changes will promote greater clarity and understanding with regard to the tasks of a board and that communication with shareholders will be more effective as a result. 6. Chairmen are encouraged to report personally in their annual statements how the principles relating to the role and effectiveness of the board (in Sections A

The Canadian private corporate tax rate is lower than the personal income tax rate.1,2 The intention for this lower tax rate is because the government recognizes the investment risks involved in operating a business.3 Also, lower tax rates incentivize business owners to reinvest in their own business which will promote a stronger economy.3 However, the issue with lower corporation tax rates is that high income individuals can use loopholes in the tax system and incorporate to pay significantly lower taxes than other non-business individuals such as the middle class causing tax inequity.4 The federal government is proposing to change the current private corporate tax codes which will prevent tax loopholes involving income sprinkling,

Regarding the Salomon case, shareholders of the corporation would not involuntarily, in their individual capability, be liable to the profits nor would they be predisposed for the errands or the company’s obligations. It therefore, had the impact that shareholders’ rights or obligations were limited to their capital invested and profits. The court, per the dicta of lord Macnaghten held “ The corporation is at law a diverse individual on the whole from the individuals subscribed to the memorandum” Nevertheless, the courts stated clearly that in the case of dishonesty and fraud being illustrated, the separate corporate personality is dumped. The Lord McNaughton is disagreeable the court should look through a corporation to hold the corporate shareholders personally or directly accountable for the corporation obligations. This is the case when the shareholders blur the distinction between the company and the shareholders. Since, even though a corporate is a legal entity, it acts through human agents that make it up (Bukola, 2002, p.15).

“A corporation will be looked upon as a legal entity as a general rule but when the motion of legal entity is used to detect the public convenience, justify wrong, protect fraud or defend crime, the law will regard the corporation as an association of persons.”

A company is considered to have a separate legal entity and an independent existence which is different from its members but still Under the Corporations Act, 2001 the main principle of the company is to operate through its directors as they are the one who are responsible for all the tasks and affairs of the company and so all the statutory responsibilities have to be carried out by its directors and hence it is very important that they perform their duties with care and honesty and compel with the provisions of corporations law and also to establish their duties under common law and general law and it is the duty of all the directors of the company that they should act in the best interest of the company.

The Companies Act, 1956 lays down the detailed provisions with respect to the preparation and maintenance of books of accounts and of annual accounts and also the publication of the same in the prescribed manner. It specifies the roles, responsibilities, duties and liabilities of directors and also the matters to be reported upon by them in the annual reports of the companies disclosing the required information. Under the provisions of the Act, it is compulsory for all companies registered under it to prepare the annual accounts and get them audited by an independent auditor. The Act extensively deals with the qualification, appointment, removal, rights, duties and liabilities of auditors and provides contents of auditors’ report. In case

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