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LML4806
Company law
ASSIGNMENT 1
MEMO
SEMESTER 2 – 2024 - UNISA
UNIQUE NUMBER: - 590226
DUE DATE: - 20 AUGUST 2024
Includes Footnotes and/or Bibliography.
ASSIGNMENT PREVIEW
QUESTIONS
Jane, John and Jabulani are the directors of Touring Africa by Bicycle (Pty) Ltd (“the company”),
a company that is based in Johannesburg. The memorandum of incorporation of the company
provides that only the board of directors have the authority to enter into contracts on behalf of
the company. James, the branch manager of the company in Durban, attends an outdoor show in
Durban to scout for useful new products for the company’s cycling excursions. At the outdoor
show one of the exhibitors, Cycle for Life (Pty) Ltd, has a limited special offer on electric bicycles
for the amount of R120 000.00 per bicycle. James contacts the directors of the company by way
of a Zoom call, and while speaking to the directors of the company on the Zoom call, James keeps
his mobile phone on speakerphone.
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, LML4806
ASSIGNMENT 01
Question: 1
Jane, John and Jabulani are the directors of Touring Africa by Bicycle (Pty) Ltd
(“the company”), a company that is based in Johannesburg. The memorandum of
incorporation of the company provides that only the board of directors have the
authority to enter into contracts on behalf of the company. James, the branch
manager of the company in Durban, attends an outdoor show in Durban to scout
for useful new products for the company’s cycling excursions. At the outdoor show
one of the exhibitors, Cycle for Life (Pty) Ltd, has a limited special offer on electric
bicycles for the amount of R120 000.00 per bicycle. James contacts the directors
of the company by way of a Zoom call, and while speaking to the directors of the
company on the Zoom call, James keeps his mobile phone on speakerphone. The
directors instruct James to purchase six of the electric bicycles on behalf of the
company. Nancy, the representative of Cycle for Life (Pty) Ltd, hears the
instruction, and because James has previously entered into agreements with Cycle
for Life (Pty) Ltd without any problems, she enters into an agreement with James
for the sale of six electric bicycles to Touring Africa by Bicycle (Pty) Ltd. The
electric bicycles are delivered to the company’s Durban office. When Cycle for Life
(Pty) Ltd sends an invoice for payment of the total amount of R720 000.00 for the
six electric bicycles, Touring Africa by Bicycle (Pty) Ltd refuses to pay, arguing that
it is not bound by the contract as James did not have the authority to act on its
behalf. Nancy approaches you for legal advice. With reference to the relevant
authority/principle and the facts, advise Nancy on what Cycle for Life (Pty) Ltd must
allege and prove in order to prevent Touring Africa by Bicycle (Pty) Ltd from
arguing that it is not bound by the contract concluded by Nancy and James. (5)
