Company Law Question Paper

Company Law

Course:Bachelor Of Commerce

Institution: Kenyatta University question papers

Exam Year:2009

KENYA TTA UNIVERSITY
UNIVERSITY EXAMINATIONS 2008/2009
SECOND SEMESTER EXAMINATION FOR THE DEGREE OF BACHELOR
OF COMMERCE
BBA 401:
COMPANY LAW
DATE: Monday 30th March, 2009
TIME: 2.00 p.m. - 4.00 p.m.
INSTRUCTIONS:
•.
Answer question ONE and any other TWO
I.
Mr. And Mrs. Majaribu Co. Ltd. 2 years ago, whose objects were to deal in bottled water. Mr. Majaribu took 100 shares and his wife S shares. In August 2008, the company was wound up and liquidator appointed. Since then the following gacts have come to light
i)
That the company owes Bidii Bank Ksh. Sm secured on a charge on the company's machinery.
ii)
The company owes Zakayo and Amina, the suppliers of the raw material used by the Co. Ksh. 2m.
iii)
That just before the winding up order was made, Majaribu Ltd had borrowed Ksh. Im from Equal Bank which Mr. Majaribu used to pay for his family's holiday.
iv)
That one of the cheques issued by the company did not bear the company's name and consequently was not honoured by the bank.
v)
The assets of the company are not adequate to pay the unsecured creditors. Advice the liquidator on the way forward .

2.
a)
Shareholders of a company have rights in the company while creditors have rights against the company. Discuss. (15 marks)
b)
Give an outline of the distinction between a share and a debenture bond., (5 marks)

3.
Critically analyse the legal rules that underpin the relationship between a promoter and the yet to be formed company. (20 marks)

4.
Discuss the process of legally bringing companies to an end and the parties entitled to such petition. (20 marks)

5.
Critically analyse the following statement "It has become clear from the role in Foss- V-Harbottle that it is the majority role that prevailas in company management. "

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