Get premium membership and access questions with answers, video lessons as well as revision papers.
- This is a case of abuse of power by directors i.e. excesses of directors.
- In this case, directors borrowed for a purpose other than that for which it was intended.
- This borrowing is intra rives, the company and is enforceable, since the bank was unaware of the misuse of the power to borrow.
- My advise to the Maendeleo Bank is that it can successfully recover the amount borrowed as it is not party to the abuse of power. My advise is based on the decision in re: David Payne & Co. where a company with a general power to borrow, borrowed from the plaintiff bank, but used the amount for an ultra rives purpose. The lending party was unaware of the abuse of power and it was held that the borrowing was enforceable.
marto answered the question on February 6, 2019 at 05:35
- Distinguish between a Fixed Charge and a Floating Charge(Solved)
Distinguish between a Fixed Charge and a Floating Charge
Date posted: February 6, 2019. Answers (1)
- Describe the duties of an Auditor as set out under the Companies Act.(Solved)
Describe the duties of an Auditor as set out under the Companies Act.
Date posted: February 5, 2019. Answers (1)
- Highlight the requirements to be met before a notice of meeting served on members can be held to be valid.(Solved)
Highlight the requirements to be met before a notice of meeting served on members can be held to be valid.
Date posted: February 5, 2019. Answers (1)
- The rule in Foss v Harbottle establishes the principle that where a wrong is done to the company, the proper plaintiff is the company itself....(Solved)
The rule in Foss v Harbottle establishes the principle that where a wrong is done to the company, the proper plaintiff is the company itself. However, where the wrong is done by the company directors, it may be impossible for the company to sue. In such a case, a derivate action may be the only option.
a) Explain what is meant by “derivative action”.
b) Describe the conditions that must be satisfied before a derivative suit can be instituted
Date posted: February 5, 2019. Answers (1)
- Define the term "prospectus" and explain the circumstances under which a company may issue a prospectus(Solved)
Define the term "prospectus" and explain the circumstances under which a company may issue a prospectus.
Date posted: February 5, 2019. Answers (1)
- Explain the Statutory and Common Law Rules that govern raising and maintenance of share capital of a company. (Solved)
Explain the Statutory and Common Law Rules that govern raising and maintenance of share capital of a company.
Date posted: February 5, 2019. Answers (1)
- Wafula, one of the Directors of Hopeful Co. Ltd is unsure of his duty of care and skill as a director of the company....(Solved)
Wafula, one of the Directors of Hopeful Co. Ltd is unsure of his duty of care and skill as a director of the company. He seeks your advice on this. Advise him.
Date posted: February 5, 2019. Answers (1)
- Hopeful, a private limited company has adopted Table A as its Articles of Association. The company now, wishes to alter the Articles of Association.
...(Solved)
Hopeful, a private limited company has adopted Table A as its Articles of Association. The company now, wishes to alter the Articles of Association.
Outline the procedure to be followed to effect the change.
Date posted: February 5, 2019. Answers (1)
- In relation to company law describe the common law duties of a Promoter.(Solved)
In relation to company law describe the common law duties of a Promoter.
Date posted: February 5, 2019. Answers (1)
- In relation to company law,discuss the rules that govern pre-incorporation contracts. (Solved)
In relation to company law,discuss the rules that govern pre-incorporation contracts.
Date posted: February 5, 2019. Answers (1)
- In relation to company law:
a) Explain the meaning of the term “Promoter”. (Solved)
In relation to company law:
a) Explain the meaning of the term “Promoter”.
Date posted: February 5, 2019. Answers (1)