1 TLAW 401 UNIT OUTLINE 2014 s3

Corporations Law can be described as the interaction between directors, employees, financier, consumers and the community. Corporations law can be implied to this case as Water Corporations, a government owned company had a responsibility upon entering into a contract with Norvik Industries to provide an attention to skill when connecting the water line. To provide fully trained employees to undertake this job. This involved double checking there work.

This essay will explain the concepts of separate personality and limited liability and their significance in company law. The principle of separate personality is defined in the Companies Act 2006(CA) ; “subscribers to the memorandum, together with such other persons as may from time to time become members of the company are a body corporate by the name contained in memorandum.” This essentially means that a company is a separate legal personality to its members and therefore can itself be sued and enter into contracts. This theory was birthed into company law through the case of Salomon v Salomon and Co LTD 1872. This case involved a company entering liquidation and the unsecured creditors not being able to claim assets to compensate them. The issue in this case was whether Mr Salomon owed the money or the company did. In the end, the House of Lords held that the company was not an agent of Mr Salomon and so the debts were that of the company thus creating the “corporate Veil” .

2 This is an OPEN book examination. You can only use your prescribed text book and the Corporations Act 2001. No other materials are allowed.

Write a 700- to 1,050-word paper in which you discuss the roles of law and courts in today’s business environment.

The thesis deals with the above concepts and discusses how the Companies Act 71 of 2008 (the Act) modified the law, particularly, by extending the legal capacity of a company and extinguishing or modifying the above rules which had previously restricted a company's ability

Miller, Roger L., Gaylord Jentz. Cengage Advantage Books: Business Law Today: The Essentials, 10e, 10th Edition. Cengage Learning, 12/2012. VitalBook file.

This paper describes the impact of the decision made in the case of Tesco Stores Ltd v Brent LBC on the law and its effects on the corporate world, and the comparison between the doctrine of vicarious liability that it outlines and the doctrine of identification that was used earlier to determine the liability of corporations in cooperate crime.

“We have completed this assignment on our own and have not discussed it with any other individual or used any other unauthorized aids. We acknowledge compliance with the academic requirements (e.g. citation of sources) of the University of Toronto.”

Learning Objective 1.2 ~ discuss the different types of companies which may be formed under the Corporations Act 2001

The corporation laws in Australia are, by and large, borrowed from the UK Company Law. Its legal structure entails a unitary national statute which is the Corporations Act 2001. This particular statute is under the authority of the Australian Securities and Investments Commission (ASIC). However, all corporation legislations are reported to the Treasurer with references being made to the judgement of the courts as is the case in the United Kingdom.

In recent times, there has been an increased incidence among large scale business organizations to structure their operations through the form of corporate groups, with many domestic and international subsidiaries, wholly owned or otherwise, with the corporate veil ensuring that each of these enjoy separate corporate legal personality and limited liability. The existence of these ‘corporate groups’, with subsidiary companies being heavily controlled by their parent companies, have necessitated interpretations and applications of existing corporate legal principles to this novel context, even in case of the basic tenets of corporate law. The circumstances associated with corporate veil piercing, through detailed consideration of conditions to treating holding and subsidiary companies as one legal unit, with associated civil liabilities, is also an issue of heated debate.

The ‘Salomon V Salomon& Co Ltd’ was a very important case in company law because it established that every company has a separate legal personality which can also be referred to as the ‘veil of incorporation.

With the contemporary appreciation of the separate entity principle in courts, it has become increasingly difficult to predict the outcome of cases with precision as in the case of Salomon v. Salomon & Co Ltd (1897). Separate corporate personality has been firmly recognized by common law after the verdict given in the case of Salomon v. Salomon & Co Ltd (1897). It was confirmed that a corporation has legal right, personality, and obligations completely divergent from those of its shareholders (Tweedale and Flynn, 2007, p.270). Courts and legislation nevertheless sometimes “pierce the corporate veil” in a bid to hold the shareholders personally accountable for the corporation’s liabilities. Courts

This act modified the methods for many different subjects, such as financial and non-financial reporting, company communications with shareholders, and the responsibilities of company heads. The main role of the Act is to get managers to act in the best interests of shareholders. It additionally requires managers to think about the long-term effects of decisions; the welfares of the business’s staff; the business’s connections alongside suppliers, clients, and others; and the impression of the company’s procedures on the surrounding area. The Company Law Review Group was established by the government in 1998 in order to contemplate ways to modernize company law. The Company Law Review guidelines were the starting point for the modifications suggested by the Company Law Reform White Paper released in 2005. Then the White Paper proposals turned into an outline for a Bill, which then finally received official approval and passed in 2006, (companieshouse.gov.uk, 2014).

The protections under the Corporations Act suffice to guard the minority from the majority’s unfair wrongdoing. In fact, the Australian corporate law provides significant protections on shareholders. To support the argument, this essay discusses Foss v Harbottle rule and derivative action. It also elaborates exceptions to the rule, especially ‘fraud on the minority’ and statutory protections available for the minority protection under the Corporations Act. These are analysed in views of organic theory, economic theory and aggregate theory. It concludes with that specific protections for the minority are unnecessary because these may lose the balance of a corporation and the minority and majority members.