Company Law – Page 7

MLP – JUL 2020 – L4 – Q1 – Legal Position of Bank in Company Diversification Loan

Advise Agyakrom Bank on its legal position regarding a negotiated loan to Ayensu Books plc for investing in a cinema and leisure complex, considering the company's objects clause, authorization requirements, and potential ultra vires issues.

Question

The main business of Ayensu Books plc is the running of a publishing company in Accra. The objects clause of the company’s regulations includes a power to borrow money as authorized by a general resolution of members. It further states that the directors may do all things that are conducive or incidental to the general business of the company and concludes with a paragraph stating that all the objects are to be regarded as distinct and separate.

The directors decided that the company should invest in a cinema and leisure complex on the Motorway Extension as a means of diversifying and offsetting its risks.

The finance director, acting on behalf of Ayensu Books, negotiated with the manager of Agyakrom Bank plc, the company’s bankers, for the borrowing of GH¢5 million to finance the development. The money is due to reach Addick’s Books bank account next month. In turn, the managing director contracted with Power Construction plc for the construction of the complex, which Power Construction has started to build, but for which it has yet to receive any payment.

Advise Agyakrom Bank on its legal position.

Answer

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Tags: borrowing authority, Company Law, Directors' Powers, Ghana Companies Act 2019, third party protection, ultra vires doctrine
Level: Level 4

Topic: Company formation, Nature of bodies corporate
Series: JULY 2020

PBL – APR 2023 – L1 – Q3 – Veil of Incorporation

Explain the meaning, benefits, and circumstances for lifting the corporate veil.

Question

a. What does the phrase the “veil of incorporation” (corporate veil) mean? (5 marks)

b. What is the benefit of having the “veil of incorporation”? (10 marks) c. When, (if at all) may the “veil” be removed? (5 marks)

Answer

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Tags: Company Law, Corporate Veil, Incorporation, Lifting the Veil, Limited Liability
Level: Level 1

Topic: Contract Law
Series: APR 2023

PBL – APR 2016 – L1 – Q5 – Private vs Public Limited Liability Companies and Conversion

Differences between a private limited liability company and a public limited liability company, and the process for converting a private company to a public one.

Question

(a) State the difference between a Private Limited Liability Company and a Public Limited Liability Company (b) Briefly describe how a Private Limited Liability company may be converted into a Public Limited Liability Company.

Answer

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Tags: Banking Customers, Borrowing Capacity, Company Law, Conversion Process, Corporate Governance, Differences, Ghana Companies Act, Private Limited Company, Public Limited Company
Level: Level 1

Topic: Contract Law
Series: APRIL 2016

FR – Nov 2023 – L2 – Q7a – Regulatory Framework for Financial Reporting

Discusses main sources of financial reporting regulations and reasons for regulatory practices.

Question

Within the context of financial reporting and regulatory frameworks:

i. Discuss the main sources of regulations. (3 Marks)
ii. Discuss TWO reasons why financial reporting practice should be regulated. (2 Marks)

Answer

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Tags: Accounting Standards, Company Law, Financial Reporting, Regulations, Regulatory Rationale, Stock Exchange
Level: Level 2

Topic: Regulatory Framework for Financial Reporting

BL – Nov 2020 – L1 – SB – Q1d – Company Law

List powers exercised by the Annual General Meeting (AGM) of a company.

Question

One of the two organs of a company is the general meeting of members.

Required:
State FOUR powers of the Annual General Meeting.

Answer

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Tags: Annual General Meeting, Company Law, Corporate Powers, Shareholder Rights
Level: Level 1

Topic: Company Law
Series: NOV 2020

BL – Nov 2020 – L1 – SA – Q4 – Company Law

Objective question testing knowledge on instances where a court may disregard corporate personality.

Question

4. A situation in which the court would disregard the distinction between the personalities of a company and its members is
A. Subrogation
B. Alienation
C. Lifting the veil of incorporation
D. Disregarding the law
E. The rule in Foss vs. Habbotle

Answer

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Tags: Company Law, Corporate Personality, Legal Principles, Veil of Incorporation
Level: Level 1

Topic: Company Law
Series: NOV 2020

BL – May 2012 – L1 – SB – Q6B – Company Law

Explain two fiduciary duties of a company director.

Question

Directors of companies are placed in special and unique positions. Their status imposes certain duties on them, and these include fiduciary duties.

Required:
Explain any TWO fiduciary duties of a company director.

Answer

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Tags: Business Law, Company Law, Directors' Duties
Level: Level 1

Topic: Company Law
Series: MAY 2012

BL – May 2012 – L1 – SB – Q6A – Company Law

Advise on the importance of filing annual returns for Xeyoze Limited.

Question

Xeyoze Limited was incorporated by the Corporate Affairs Commission on February 1, 2010. On March 1, 2011, the company bid for a contract to rehabilitate one of the nation’s oil refineries. This contract attracted scores of bidders because it was seen as a very lucrative one. A rival bidder objected to the competence of Xeyoze Limited to bid for the contract on the ground that an investigation at the Corporate Affairs Commission revealed that the company has not filed its annual returns.

Required: Advise Xeyoze Limited on the following:

(i) The importance of filing annual returns. (2 Marks)
(ii) The period within which the annual returns must be filed. (2 Marks)
(iii) The consequences of failure to file annual returns. (2 Marks)
(iv) Whether it is optional to file the annual returns or not (2 Marks)
(v) What is your advice if the contract was bid for on October 1, 2010? (3 Marks)

Answer

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Tags: Business Law, Company Law, Compliance
Level: Level 1

Topic: Company Law
Series: MAY 2012

BL – May 2012 – L1 – SB – Q1B – Company Law

Advise Halidu on transferring shares to raise money for school fees.

Question

Halidu holds one million shares in Realshares Nigeria Plc. Zaidi, his son, has just returned from the University of Basel because he could not pay school fees. Halidu is cash-strapped and wants to know whether he could transfer his shares to someone else to raise money to pay the fees.
Required: Advise Halidu, stating the statutory conditions by which he could transfer his shares. (5 Marks)

Answer

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Tags: Business Law, Company Law, Share Transfer
Level: Level 1

Topic: Company Law
Series: MAY 2012

BL – May 2012 – L1 – SA – Q18 – Company Law

Identify the concept that allows a company to continue existing despite changes in ownership.

Question

The fact that a company cannot die connotes that it has:

Answer

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Tags: Business Law, Company Law, Perpetual Succession
Level: Level 1

Topic: Company Law
Series: MAY 2012

BL – Nov 2014 – L1 – SB – Q3c – Company Law

State the three types of company meetings held by incorporated companies.

Question

Meetings of incorporated companies are for diverse purposes.
State the THREE types of company meetings.
(Total 3 Marks)

Answer

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Tags: AGM, Company Law, EGM, Meetings
Level: Level 1

Topic: Company Law
Series: NOV 2014

BL – Nov 2014 – L1 – SB – Q3b – Company Law

State eight documents required for the incorporation of a company at the Corporate Affairs Commission.

Question

Persons proposing to form a company are required to present certain documents to the Corporate Affairs Commission.
You are required to state any EIGHT of the documents to be presented to the Corporate Affairs Commission for the incorporation of a company.
(Total 8 Marks)

Answer

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Tags: Company Law, Corporate Affairs Commission, Incorporation
Level: Level 1

Topic: Company Law
Series: NOV 2014

BL – May 2018 – L1 – SA – Q3 – The Nigerian Legal System

Identify the court with original jurisdiction in company matters.

Question

Which court has original jurisdiction in company matters?
A. State High Court
B. National Industrial Court
C. Federal High Court
D. Magistrate Court
E. Supreme Court

Answer

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Tags: Company Law, Jurisdiction, Nigerian Legal System
Level: Level 1

Topic: The Nigerian Legal System
Series: MAY 2018

BL – Nov 2014 – L1 – SB – Q3a – Company Law

State distinctions between a limited liability company and a partnership, and explain a director’s duty regarding conflicts of interest.

Question

a. Limited liability companies and partnerships are different in formation and characteristics.
You are required to:

i. State any FIVE distinctions between a limited liability company and a partnership.
(5 Marks)

ii. Explain briefly the duty that a director’s interest shall not conflict with his duties to the company and its consequences.
(4 Marks)

Answer

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Tags: Company Law, Conflict of Interest, Directors' Duties, Partnership
Level: Level 1

Topic: Company Law
Series: NOV 2014

BL – Nov 2014 – L1 – SB – Q2a – Company Law

List five contents of the Articles of Association of a company.

Question

“The Memorandum and Articles of Association of a company are together the Constitution of the company.”
You are required to list any FIVE contents of the Articles of Association.
(Total 5 Marks)

Answer

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Tags: Articles of Association, Company Constitution, Company Law
Level: Level 1

Topic: Company Law
Series: NOV 2014

BL – Nov 2014 – L1 – SB – Q1b – Company Law

Explain two differences between fixed charge and floating charge on company properties.

Question

One of the conditions attached to loans obtained by a registered company is the creation of a charge on the properties of the company.
You are required to explain briefly any TWO differences between fixed charge and floating charge.
(Total 5 Marks)

Answer

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Tags: Company Law, Fixed Charge, Floating Charge, Loan Security
Level: Level 1

Topic: Company Law
Series: NOV 2014

BL – May 2022 – L1 – SB – Q5c – Company Law

State two situations that show netting has occurred in a company.

Question

In a company, there may be a reason for netting.

Required:
State TWO situations that show that netting has occurred.

Answer

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Tags: Company Law, Financial Transactions, Netting
Level: Level 1

Topic: Company Law
Series: MAY 2022

BL – Nov 2014 – L1 – SA – Q8 – Company Law

Identifying a situation where a company is not considered insolvent

Question

A company may be declared insolvent in any of the following situations EXCEPT if it:
A. Fails to file annual returns
B. Has been wound-up
C. Is a judgment debtor
D. Is not a judgment creditor
E. Is incapable of meeting its financial obligations

Answer

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Tags: Company Law, Insolvency, Legal Status
Level: Level 1

Topic: Company Law
Series: NOV 2014

BL – Nov 2014 – L1 – SA – Q6 – Company Law

Identifying the consequence for a director breaching fiduciary duty

Question

A company director who breaches his/her fiduciary duty to the company is liable to being
A. Removed from office
B. Reported to the Economic & Financial Crimes Commission (EFCC)
C. Reported to the Independent Corrupt Practices Commission (ICPC)
D. Reported to the Police
E. Rusticated

Answer

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Tags: Company Law, Director Liability, Fiduciary Duty

Topic: Company Law
Series: NOV 2014

BL – Nov 2014 – L1 – SA – Q3 – Company Law

Identifying the correct legal status of a company in law

Question

A company is regarded in law as
A. Corporate aggregate
B. Corporate personality
C. Corporate trustee
D. Corporate proprietorship
E. Corporate municipality

Answer

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Tags: Company Law, Corporate Personality, Legal Entities
Level: Level 1

Topic: Company Law
Series: NOV 2014

Question Tag: Company Law

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MLP – JUL 2020 – L4 – Q1 – Legal Position of Bank in Company Diversification Loan

Advise Agyakrom Bank on its legal position regarding a negotiated loan to Ayensu Books plc for investing in a cinema and leisure complex, considering the company's objects clause, authorization requirements, and potential ultra vires issues.

You're reporting an error for "MLP – JUL 2020 – L4 – Q1 – Legal Position of Bank in Company Diversification Loan"

PBL – APR 2023 – L1 – Q3 – Veil of Incorporation

Explain the meaning, benefits, and circumstances for lifting the corporate veil.

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PBL – APR 2016 – L1 – Q5 – Private vs Public Limited Liability Companies and Conversion

Differences between a private limited liability company and a public limited liability company, and the process for converting a private company to a public one.

You're reporting an error for "PBL – APR 2016 – L1 – Q5 – Private vs Public Limited Liability Companies and Conversion"

FR – Nov 2023 – L2 – Q7a – Regulatory Framework for Financial Reporting

Discusses main sources of financial reporting regulations and reasons for regulatory practices.

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BL – Nov 2020 – L1 – SB – Q1d – Company Law

List powers exercised by the Annual General Meeting (AGM) of a company.

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BL – Nov 2020 – L1 – SA – Q4 – Company Law

Objective question testing knowledge on instances where a court may disregard corporate personality.

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BL – May 2012 – L1 – SB – Q6B – Company Law

Explain two fiduciary duties of a company director.

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BL – May 2012 – L1 – SB – Q6A – Company Law

Advise on the importance of filing annual returns for Xeyoze Limited.

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BL – May 2012 – L1 – SB – Q1B – Company Law

Advise Halidu on transferring shares to raise money for school fees.

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BL – May 2012 – L1 – SA – Q18 – Company Law

Identify the concept that allows a company to continue existing despite changes in ownership.

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BL – Nov 2014 – L1 – SB – Q3c – Company Law

State the three types of company meetings held by incorporated companies.

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BL – Nov 2014 – L1 – SB – Q3b – Company Law

State eight documents required for the incorporation of a company at the Corporate Affairs Commission.

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BL – May 2018 – L1 – SA – Q3 – The Nigerian Legal System

Identify the court with original jurisdiction in company matters.

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BL – Nov 2014 – L1 – SB – Q3a – Company Law

State distinctions between a limited liability company and a partnership, and explain a director’s duty regarding conflicts of interest.

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BL – Nov 2014 – L1 – SB – Q2a – Company Law

List five contents of the Articles of Association of a company.

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BL – Nov 2014 – L1 – SB – Q1b – Company Law

Explain two differences between fixed charge and floating charge on company properties.

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BL – May 2022 – L1 – SB – Q5c – Company Law

State two situations that show netting has occurred in a company.

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BL – Nov 2014 – L1 – SA – Q8 – Company Law

Identifying a situation where a company is not considered insolvent

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BL – Nov 2014 – L1 – SA – Q6 – Company Law

Identifying the consequence for a director breaching fiduciary duty

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BL – Nov 2014 – L1 – SA – Q3 – Company Law

Identifying the correct legal status of a company in law

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