I received a distinction from these notes! The latest notes on the LPC at BPP made this year! These notes are the most concise yet detailed notes which are distinction level. In my opinion they are the best notes for Business Law & Practice online. They cover all the knowledge needed for the Busine...
Company v LLP v Partnership, Private v Public (MCQ)- SGS 1
Partnership LLP Limited Co
Statute PA 1890 LLPA 2000/regulations CA 2006
Liability of Unlimited personal Liability is limited- individual Liability is limited- members
investors liability members not personally are only liable to pay any
liable over and above their amount unpaid on their
capital share in LLP shares- s3 (2) CA
Legal status Not a separate legal Separate legal entity Separate legal entity
of business entity- partners are
medium the partnership an
each are
individually
responsible
Number of Minimum of 2 Minimum of 2 Minimum of 1- s7 (1) CA
persons
needed to set
up business
Expenses None but Incorporation document Incorporation documents
before or for recommended to Registration fee including memorandum and
setting up have partnership Articles (form constitution)
business agreement drawn Registration fee
up
Publicity and None required -Registered office -Registered office
disclosure -Details of -Accounts
members/designated -Information on -directors
members -Information on the share
-Accounts capital of company
-PSC -Certain resolutions of
members
-PSC register
Ongoing None necessary- -Accounts prepared annually -Accounts prepared annually
expenses accountants will be -Most LLPs to file audited -Most Cos to file audited
involved keeping accounts accounts
accounts -Confirmation statement at -Confirmation statement at
least once a year least once a year
Management In accordance with Apart from a few default Meetings of directors and SHs
structure agreement/default provisions in LLPA, there are in accordance with CA/MA or
provisions in PA few formalities associated adopt own Articles
with company management
procedure
Methods of Can borrow but Can borrow and create Can borrow and create
funding cannot create floating charges but cannot floating charges and can raise
floating charges and raised by issuing shares by issuing shares
cannot raise by
issuing shares
Private co Public co
Name must end with Limited or Ltd- s59 (1) Public limited or plc- s58 (1)
1
,Minimum no of SHs 1- s7 (1) and 8 (1) 1- s7 (1) and 8 (1)
Minimum no of directors 1- s154 (1) 2- s154 (2)
Company sec required No- s270 (1) Yes- s271
Certificates required before Certificate of incorporation- Certificate of incorporation- s15
commencing trading s15 (4) (4)- cannot commence until a
Can commence as soon as trading certificate is issued by
incorporated Registrar showing company’s
allotted share capital is not less
than minimum- s761 (1) (2)
Minimum share capital At least one share- s8 (1) (b) Minimum of £50,000- s763 (1) (a)
(b)
CA allows offer share to Prohibited- s755 (1) Permitted (but not FSMA)
public
Method of payment and No restriction on payment Payment in cash only- s593 (1)
minimum amount payable for method- s582 (1) (2) 25% of nominal value must be paid
share capital Shares can be issued without on allotment plus whole of any
immediate payment premium- s586 (1)
Group structures- s1159 CA- SGS 2
Choice of name- ss53-59, s66, s82 CA/Regulations: 2014/3140 and 2015/17
• A change of name becomes effective on date which new certificate of
incorporation is issues- s81 (1)
Pre-incorporation contracts- s51 CA- SGS 4
• A company cannot enter into contracts pre-incorporation- s51 CA
• If contract is entered into, the concept of agency would not help a board of
company achieve a contract as company not even incorporated yet
• If contract is entered into before incorporation- person entering into contract
would be personally liable, company not incorporated no penalty however if
holding company allows director to act as agent for subsidiary that does not yet
exist then it may be liable
Articles of association- SGS 6
• Apply relevant section of Act (if any)
• Compare:
-Act silent
-Complete freedom
-Min/max threshold
-Act as default where Articles are silent
-Outright prohibition
• If precedent article is incompatible- Act prevails
How do companies make decisions?
• Identify changes required/transactions co wants to enter into
• Identify procedure from CA or articles- is decision of DIRs/SHs?
• What meetings are required? BM or GM?
• Procedure plan
Making changes/transfer of shelf company- SGS 5/mock, changing articles (using WR)-
SGS 6, substantial property transactions- SGS 11, issuing shares- SGS 12 and buyback of
shares- SGS 18
Change to shelf- co:
2
, • Change of name (s77 (1) (a)/(b) - SR - form NM01/resolution to registrar
• Resignation of sec (handing in at BM)- BR to accept resignation- form
TM02/notify registrar (s276 (1))
• Appointment of sec (s270 (1)/MA 3 and 5)-BR-form AP03/notify registrar (s276
(1))
• Appointment of new directors (MA 17 (1) (a)/(b))-BR- form AP01/notify
registrar (s167 (1))
• Resignation of existing directors (MA 18 (f))- BR- form TM01 (s167 (1))
• Appointment of chairperson (MA 12 (1))-BR
• Transfer of subscriber shares (s112 (2)/544 (1) and MA 26)-BR approving share
transfer, enter new members on Register of members and instruct secretary to
issue new share certificate-BR- Stock Transfer Form
• Change of registered office (s87 (1))-BR-form AD01
• Change of accounting ref date (s392 (1))-BR-form AA01
• Appoint auditors (s485 (3))-BR
Procedure plan:
BM 1:
• Who calls? ANY DIRECTOR- MA 9 (1)
• Notice period (check articles)? REASONABLE according to what is usual for the
company (Browne v La Trinidad)
• Quorum (check articles)? 2 (MA 11 (2))
• (Does a director need to declare an interest in a transaction- s177 (1) CA)
• Agenda?
-If GM is required always need: BR to approve notice of GM and contents
(s311/s325 (1)), BR to call GM (s302) and BR to instruct secretary to send out
notice in accordance with s308 and set to every member and director (s310 (1)
(a) and (b))
-Is there any documentation that needs to be prepared for GM: memorandum re
loan or service contract/contract (buybacks) or loan agreement
-Propose WR- s288 (3) (a)- approve form (if SR designate it as such and
instructions on how to vote (s291 (4)(a) and 296) and identify the lapse date
(s291 (4)(b) and 297) and company secretary to send out to all members(s291
(2)) and to auditors (s502 (1))
• Voting? MAJORITY DECISION- MA 7 (1)
• Adjourn or Close?
-Adjourn meeting if being held on short notice or use of WR
-If GM on usual 14 clear days notice then need to close meeting
If WR then no GM needed- whilst BM is adjourned resolution can be passed using WR, it
is passed when required majority of those member signify agreement to it
GM:
• Who calls? ANY DIRECTOR (s302)
• Notice period?
-Usual notice- 14 clears days- s307 (1) and s360 (2) CA
-Is short notice possible? Two conditions satisfied:
3
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