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Buss 216:Business Law Ii Question Paper

Buss 216:Business Law Ii

Course:Business Administration

Institution: Kenya Methodist University question papers

Exam Year:2011

SCHOOL : SCHOOL OF BUSINESS AND ECONOMICS

DEPARTMENT : BUSINESS ADMINISTRATION

TIME : 2 HOURS

INSTRUCTIONS Answer Question ONE and any Other TWO Questions

Question 1

a) A.B. and C incorporated a company in 2009. In January of 2011 it became apperement that the company is not able to pay its creditors in full

Joan, the company secretary has come to you for advice on the following issues:

i) The meaning of a winding up order (3marks)

ii) The parties who ma petition the court for the winding up order. (3marks)

iii) Other than the company`s inability to pay its debts whether there are other circumstances that may lead to its winding up. (14marks)

b) Critically examine the circumstances that may make a court to issue an order for the lifting of the veil of incorporation. (3marks)

Question 2

Section 22 of the companies Act states that once a company`s memorandum of ariticles of association are registered they constitute a contract between the company and the members and the members between themselves. (20marks)

Question 3

a) Critically examine the legal significance (effect) of the registration of a company. (10marks)

b) Set out in details the rights of a member of a company. (10marks)

Question 4

a) Discuss the duties of the directors of a company under:

i) The common law (7marks)

ii) Doctrine of equity (7marks)

b) To whom are these duties owned? Give reasons. (6marks)

Question 5

The distinction between an altra vines transactions and a transaction beyond the powers of an officer of the company is important in determining the validity of any contract entered into in the name of the company. (20marks)

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