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Company Law Questions and Answers

Answer any eight of the nine questions below.

Question 1:

Explain the principle of separate legal entity in relation to companies and with reference to the principles of attribution discuss who is liable out of NEL, Mr Nguyen and Anita under the lease and also whether any person other than the truck driver is also liable to the owner of the Mercedes car.

Question 2:

Discuss the ultra vires doctrine of company law and its effect on the contract entered into between GLL and BB. Giving reasons; discuss whether the contract may or may not be valid under the Companies Act 1993.

Question 3:

Advise Mr Nguyen about any shareholder remedies that may be available to him in regard to Black Knight Limited (BKL) under the Companies Act 1993 and related cases.

Question 4:

Explain Fan’s obligation to disclose his interest in the transaction with Sarah under the Companies Act 1993 and any rights the shareholders may have if disclosure is correctly made. Also explain the possible consequences for Fan if he does not disclose.

Question 5:

Discuss whether Mr Nguyen and/or Ling might be held personally liable under the Companies Act 1993 as directors for the losses suffered by LIP now that it is in liquidation.

Question 6:

Outline the role of a receiver and explain how priority will be determined between New Zealand Savings Bank and Top Gun Computers Limited in regard to the office computer system under the Personal Property Securities Act 1993. Also explain whether the New Zealand Savings Bank still has a security interest over the jet boat that has been sold to the customer.

Question 7: 

Franchises are a convenient form of business operation for both franchisor and franchisee but differences can arise between them which from time to time lead to court action. Set out what a franchise is and some of the issues that may commonly arise between franchisor and franchisee including a discussion of at least one relevant precedent.

Question 8:

A trading trust may have a limited liability company as its trustee. Explain to Mr Nguyen the nature of a trading trust including the obligations the company owes to the beneficiaries of the trust and the role of the company directors where the company is a trustee.

Question 9:

Mr Nguyen is thinking of raising funds for his company by selling a new issue of shares to members of his family and also to the public.

Discuss the obligations that would be on Mr Nguyen under the Financial Markets Conducts Act 2013 when issuing these shares. What possible legal risks could he be exposed to?

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