The Articles Of Association Of A Company

The articles of incorporation may also indicate the names and addresses of those who initially served as directors. It can also set forth the purpose

This essay will explain the concepts of separate personality and limited liability and their significance in company law. The principle of separate personality is defined in the Companies Act 2006(CA) ; “subscribers to the memorandum, together with such other persons as may from time to time become members of the company are a body corporate by the name contained in memorandum.” This essentially means that a company is a separate legal personality to its members and therefore can itself be sued and enter into contracts. This theory was birthed into company law through the case of Salomon v Salomon and Co LTD 1872. This case involved a company entering liquidation and the unsecured creditors not being able to claim assets to compensate them. The issue in this case was whether Mr Salomon owed the money or the company did. In the end, the House of Lords held that the company was not an agent of Mr Salomon and so the debts were that of the company thus creating the “corporate Veil” .

2 This is an OPEN book examination. You can only use your prescribed text book and the Corporations Act 2001. No other materials are allowed.

The thesis deals with the above concepts and discusses how the Companies Act 71 of 2008 (the Act) modified the law, particularly, by extending the legal capacity of a company and extinguishing or modifying the above rules which had previously restricted a company's ability

Learning Objective 1.2 ~ discuss the different types of companies which may be formed under the Corporations Act 2001

Lipton, P. & Herzberg, A. (2010). Understanding Company Law. (15th ed.). Pyrmont, NSW: Lawbook Co.

Choosing a Corporation/Company Structure - the business structure of a company/ corporation is highly recommended, it has the flexibility to gain more capital, or credit capability and assets used as security. Based on the Corporation Act 2001 (Cth) AC 22, a corporation is another legal entity with their own legal rights, duties and responsibilities separate to the individual or owner of the company (Harris, Hargovan & Adams, 2013, pp 229). The risk and consequences are one of the principal considerations of choosing a company structure (Harris, Hargovan & Adams, pp 50). Based on the “Corporate Veil” Liability is owned by a separate legal entity and not to the extent of the owner, for instance, the debt of the company is not a personal liability, but the company. This is further explained in the case below.

Although doctrine of separate legal entity has the greatest importance in company law, it contains weaknesses that could be arguable. Professor Kahn-Freund described the doctrine as “calamitous” because it arise many issues, such as “How is it possible to check the one-man company and other abuse of company law?” Separate legal entity is inadequate for complex problems .

Consistency is when a business organisation adopts a certain method; the company has to make sure that they are only using the chosen method.

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.

In the statement, it is mentioned that the great strength of the common law lies in its capacity to develop to meet the changing needs and circumstances of the society in which it functions. A case to illustrate this point would be W v Registrar of Marriages [2013] HKCFA 39 (CFA).

Some of the main effects of the Companies Act on private companies are: an individual and simplified model of Articles of Association; individual requirements for accounting and reporting; no requirement for a company secretary; no requirement for an annual meeting; and simplified rules about share capital, (companieshouse.gov.uk, 2014). The key benefits of the Companies Act for shareholders

Sole traders have unlimited liabilities,meaning that in terms of law there is no separation between them,hence the sole trader is also liable for the debts incurred within the business, which makes it very risky to run for a long-term.

in criminal law and Beckett Ltd v. Lyons [1967] 1 All ER 833 the law

The English Legal System has several sources of legislation, including the precedent cases, which form