MRL2601
October/November 2023
QUESTION 1
1.1 Beauty, Phineas and Samson are three friends who wish to start their own publishing
company. While driving one Sunday afternoon, Samson comes across the perfect
office building. He wishes to purchase this building on behalf of the proposed company.
...
1. I know that plagiarism means taking and using the ideas, writings, works or
inventions of another as if they were one’s own. I know that plagiarism not only
includes verbatim copying, but also the extensive use of another person’s ideas
without proper acknowledgement (which includes the proper use of quotation marks)
or any attempt to cheat the plagiarism checking system. I know that plagiarism
covers the use of material found in textual sources and from the Internet.
2. I acknowledge and understand that plagiarism is wrong.
3. I understand that my assignment/exam answers must be accurately referenced.
4. This assignment/exam file/portfolio is my own work. I acknowledge that copying
someone else’s work, or part of it, is wrong, and that submitting identical work to
others constitutes a form of plagiarism.
5. I have not allowed, nor will I in the future allow anyone to copy my work with the
intention of passing it off as their own work.
6. I understand that I can be awarded 0% if I have plagiarized.
7. I understand that my assignment/exam file/portfolio may be submitted
automatically to Turnitin.
8. I confirm that I have read and understood the following UNISA policies: 8.1 Policy
for Copyright and Plagiarism
8.2 Policy on Academic Integrity
8.3 Student Disciplinary Code
1.1 Beauty, Phineas and Samson are three friends who wish to start their own publishing
company. While driving one Sunday afternoon, Samson comes across the perfect
office building. He wishes to purchase this building on behalf of the proposed company.
Advise Samson on the requirements that would need to be adhered to in terms of the
Companies Act 71 of 2008 in order to conclude a valid and binding contract on the
company’s behalf before its incorporation. (5)
Requirements for Samson to conclude a valid contract on behalf of the proposed company before its
incorporation: In terms of the Companies Act 71 of 2008:
• Pre-Incorporation Contract: Samson can enter into a pre-incorporation contract on behalf of
the company, provided he explicitly or implicitly acts on behalf of the company.
• Binding Nature: Even if the company is not yet incorporated, the contract becomes binding on
the company once it has been incorporated.
• Ratification: After the company is formed, it must ratify or adopt the contract made by
Samson. If the company chooses not to adopt the contract within a reasonable period, Samson
could be personally liable for the contract.
• Disclosure: Samson must make it clear to the other party that he is contracting on behalf of a
company yet to be incorporated. If he doesn’t, he could be held personally liable.
• Written Agreement: It's best if the contract is in writing, detailing the terms of the agreement,
to avoid disputes later on.
1.2 Nonhlanhla and Petrus want to start a catering business together called Bayview (Pty)
Ltd. Briefly explain the procedure that they must follow in order to incorporate the
company. (5)
Procedure to incorporate Bayview (Pty) Ltd:
, • Reservation of Name: Nonhlanhla and Petrus must first reserve the name "Bayview (Pty) Ltd"
with the Companies and Intellectual Property Commission (CIPC).
• Notice of Incorporation and Memorandum of Incorporation (MOI): They must file a Notice
of Incorporation and MOI with the CIPC. The MOI sets out the rights, duties, and
responsibilities of shareholders, directors, and others.
• Registration Fees: Pay the required fees for incorporation with the CIPC.
• Company Registration Number: Once the CIPC has approved the application, they will allocate
a registration number to Bayview (Pty) Ltd.
• Issuance of a Certificate: CIPC will then issue a registration certificate confirming the
company’s status.
1.3 Everite Ltd showed an increase in profits for the 2023 financial year. At a board
meeting, the directors decide that dividends should be paid out to the company’s
shareholders. Indicate what the requirements are in terms of the Companies Act 71 of
2008 that must be adhered to before the dividends may be declared and paid. (5)
1.4 Woodin Ltd intends to convene its annual general meeting on 12 June 2024. List any
five ( 5 ) matters t h a t must be discussed at this meeting in terms of the Companies
Act 71 of 2008. (5)
Requirements for declaration and payment of dividends:
• Solvency and Liquidity Test: The board must reasonably believe that the company will satisfy
the solvency and liquidity test immediately after completing the proposed distribution.
• Board Approval: The board must acknowledge that there are reasonably foreseeable
circumstances that may affect this belief and they must follow the procedure outlined in the
company's MOI or the Act.
• No Contravention: The payment of dividends must not contravene any provision of the
company’s MOI.
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