Explain two terms implied in a contract of sale of shares between a seller and purchaser ANSWER Terms implied in a contract of sale of shares between a seller and purchaser. • That the buyer will pay the price of Open …
Category: A CPA Company Law revision
CPA Company Law questions and answers
Explain five circumstances when shares may be issued at a discount
Explain five circumstances when shares may be issued at a discount ANSWER Issue of shares at a discount • The shares must belong to a class already issued by the company. • One year must have elapsed from the date Open …
Kioko, an Under Secretary in the Ministry of Viwandani was entrusted with the responsibility of selling the Ministry‟s boarded motor vehicles. He invited bids frommembers of the public to buy two lorries. He also bid, through a nominee. Mwangangi, his own brother. Subsequently, he sold the lorries to Mwangangi, at Sh.80,000 each. Kioko then formed Kima Company Ltd and instructed Mwangangi to sell the lorries to the company at Sh.350,000 each. A prospectus as issued to the public to subscribe for shares to Kima Company Ltd. The prospectus gave Mwangangi as the vendor of the lorries and did not disclose the profit Kioko was making. Musembi, a shareholder of the company has learnt of the sale of the lorries to the company and the profit Kioko made and seeks your advice on the company’s rights in respect of the same. Advise Musembi.
Kioko, an Under Secretary in the Ministry of Viwandani was entrusted with the responsibility of selling the Ministry‟s boarded motor vehicles. He invited bids frommembers of the public to buy two lorries. He also bid, through a nominee. Mwangangi, his Open …
Outline the rules that govern pre-incorporation contracts. Cite relevant case-law to support your answer.
Outline the rules that govern pre-incorporation contracts. Cite relevant case-law to support your answer. ANSWER a) A pre-incorporation contract is a contract entered into before a company is incorporated. Rules governing pre-incorporation contracts • A pre-incorporation contract does not bind Open …
Janet and Jackson Onyango are forming a Limited Liability Company. They are seeking your legal advice on the issues listed below. Respond to the enquiries by Janet and Jackson Onyango on: a) What are the Memorandum and Articles of Association and is there a difference between the two b) What details would you expect them to contain and what other information might you be able to give about these details?
Janet and Jackson Onyango are forming a Limited Liability Company. They are seeking your legal advice on the issues listed below. Respond to the enquiries by Janet and Jackson Onyango on: a) What are the Memorandum and Articles of Association Open …
Explain who is responsible for the expenses incurred while carrying out investigations into the company’s affairs
Explain who is responsible for the expenses incurred while carrying out investigations into the company’s affairs ANSWER Under the Companies Act, the expenses of and incidental to an investigation by an inspector appointed by the court are defrayed by the Open …
State the powers of the inspection appointed to investigate the affairs of the company
State the powers of the inspection appointed to investigate the affairs of the company. ANSWER • To investigate the holding or subsidiary company if the same is necessary of the investigation. • To administer oath. • To examine persons on Open …
Detail the statutory provisions governing the investigation into the affairs of a company by the registrar
Detail the statutory provisions governing the investigation into the affairs of a company by the registrar ANSWER The registrar of companies is empowered to investigate the affairs of a company by self or by an inspector in certain circumstances. The Open …
State the legal consequences of a winding up order made against a company
State the legal consequences of a winding up order made against a company. ANSWER All floating charges created by the company crystallize and become fixed. • The company ceases to carry on business except such as may be required for Open …
Describe the circumstance under which a company may be wound up on the ground that it is „just and equitable‟ to do so
Describe the circumstance under which a company may be wound up on the ground that it is „just and equitable‟ to do so. ANSWER Under the Companies Act, “a company may be wound up by the court, if the court Open …