Which of the following statements describes the decision of the House of Lords in Salomon v A Salomon & Co Ltd (1897)?

1.   ?    A company has unlimited liability for its debts
2.   ?    A company cannot issue floating charges to its members
3.   ?    A company is a legal entity, distinct from its members
4.   ?    A single member cannot form a company

In Lee v Lee’s Air farming Ltd (1960), the court held that a company could not enter into a contract of employment with the person who was its governing director and majority shareholder.

1.   ?    False
2.   ?    True

Which of the following is not regarded as an example of the lifting of the veil of incorporation?

1.   ?    S 213 Insolvency Act 1986
2.   ?    S 214 Insolvency Act 1986
3.   ?    S 14 Companies Act 1985
4.   ?    S 6 Company Directors Disqualification Act 1986

In Tesco Supermarkets Ltd v Nattrass (1974), the House of Lords held that, under the test of identification, a branch manager did not represent the directing mind and will of the defendant company?

1.   ?    True
2.   ?    False

Which of the following statements is not a correct proposition in relation to the role of a promoter of a company?

1.   ?    A person who takes the necessary steps to form a company
2.   ?    A person who owes fiduciary duties to a company
3.   ?    A person who is acts as a director of a company during the course of the promotion of the company
4.   ?    A person who can become a member of a company on incorporation of the company

Which of the following statements does not describe the status of Table A of the Companies (Tables A-F) Regulations 1985?

1.   ?    Table A is a mandatory set of articles of association in all circumstances
2.   ?    Table A is an optional set of articles of association
3.   ?    Table A is can be adopted in full or in part
4.   ?    Table A can be adopted by public and private companies having a share capital

Which of the following statements is a correct proposition in relation to an alteration of the articles of association of a company?

1.   ?    Any alteration must be made by the passing of an ordinary resolution.
2.   ?    Any alteration must be made by the passing of a special resolution of the board of directors.
3.   ?    Any alteration must be in good faith for the benefit of the company as a whole.
4.   ?    Any alteration is not binding on members by virtue of s 14 CA 1985.

Which of the following statements is true?

1.   ?    An ultra vires act is incapable of being ratified
2.   ?    Any contract entered into beyond a company’s stated objects is void
3.   ?    Directors cannot be held liable for ultra vires acts
4.   ?    A shareholder can prevent a company from entering into an ultra vires transaction

Given the existence of s 35(1) CA 1985, it is no longer a requirement for a company to have an objects clause

1.   ?    False
2.   ?    True

The effect of s 332A CA 1985 is to make company contracts voidable where:

1.   ?    The contract is ultra vires and the other party to the contract is a director of the company
2.   ?    The contract is ultra vires
3.   ?    The contract is ultra vires and is ratified by a company in general meeting.
4.   ?    The contract is intra vires and the other party is a director of the company