Sub: Business and Corporation Law
Q.1 Essay legal analytical question. (20 marks)
Ramsay and Janet are two directors and each 50% of shareholders of a company, the company was to be called Master plate Pty Ltd; on 22 February, Janet entered into a contract with Irish Linen Ltd to purchase 18 monogrammed tablecloths. He executed the contract in the name of Master Plate Pty Ltd.
On 24 February, the proposed company was registered. The company did not adopt a constitution. Due to dispute between Ramsay and Janet regarding the contract with Irish Linen Ltd, that contract was not ratified until 30 March.
On 1 April, Janet orders restaurant-quality cutlery from Carvers Pty Ltd. Janet affixes the company seal to the contract and signs it.
On 1 May, the tablecloths supplied by Irish Linen Ltd have been delivered to Master Plate but not paid for. Required:
A) Advise Janet whether the company is liable to pay external suppliers.
B) What the assumptions are Carvers Pty Ltd entitled to make?
C) Also advise Janet of the consequences for the company in not carrying on activities within its objectives.
Note: Need to answer the above questions according to Issue, Law, Analysis and Conclusion. Relevant sections for above questions are S128, S129, S180, S183 and so on.
Q.2 Short answer questions knowledge based. (5 Marks for each)
a) Providing reasons, whether or not you think the case Donoghue v Stevenson  AC 562 advanced the law.
b) What is the legal effect of the decision in Salomon v Salomon  AC 22?
c) Explain why a company may choose to go into voluntary administration and what are the possible courses of action that an administrator might advise the creditors to take after investigating the company.
d). When is it appropriate to bring a statutory derivative action (s236)?
e). Outline the steps a company must take if it wishes to modify its constitution.
f). Outline the obligations of a small proprietary company when it resolves to prepare a financial report and send it to members.
g). Can the failure to disclose a material personal interest hurt a director or the company?
h). Explain to a client why the rules governing the internal administration and management of their company can be replaceable.
i). Complete performance of all contractual obligations will generally discharge the contract, but what are the exceptions to the exact performance?