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PRE-INCORPORATION CONTRACTS & INCORPORATION OF COMPANY - Coggle Diagram
PRE-INCORPORATION CONTRACTS & INCORPORATION OF COMPANY
Incorporation of Company
Pre-Incorporation Contracts
Contracts made before a company is incorporated.
A company has no contractual capacity prior to incorporation
Before incorporation, company is not a separate entity and therefore it is incapable of gaining contractual rights or incurring liabilities.
The promoters are responsible for acting for the company.
Promoters
Those who cause a company to be incorporated and also those who may later find persons to act as its directors, arrange for its shares to be offered to the public or sell assets to it, provided always that in these activities they are GENERALLY INVOLVED IN LAUNCHING THE COMPANY.
Tracey v Mandalay Pty Ltd
Twycross v Grant
Procedure of Incorporation of Company
Sec. 14(1)
Search as to the availability and
reservation of the proposed name.
Form 13A
Minimum no is 2.
Name Reservation
Reserved for 3 months.
Subscribers as Members
Deemed to have agreed to
become members
Even if the subscribers are not entered in the register of the members.
In its register of members.
Duties of Promoters
Fiduciary relationship
Duty to disclose to the company any profit which he may secure
Independent board of directors
Existing or intended shareholders
Certificate of Incorporation
F9: Private Co.
F8: Public Co.
Contents
Company number.
Company name.
Date of incorporation.
The type of company that has been set up e.g. limited by guarantee or an unlimited company.
The company’s status e.g. private or public.
Remedies for Breach
Rescission of contract
Recovery of secret profit
Damages for breach of fiduciary duty
Effects of Incorporation
Separate legal entity
Salomon v Salomon
Can sue and be sued
Foss v Harbottle
Ability to own property
Macaura v. Northern Assurance Co
Limited liability onmembers
Perpetual succession
Powers of a Company
A company acts trough its agent
Statutory Lifting of Corporate Veil
Sec. 36
Sec. 67
Sec. 121
Sec. 303(3) & 304(2)
Sec. 304(1)
Sec. 305
Sec. 365(2)(b)
Sec. 46 EPF Act
Sec. 108A Emp. Soc. Sec. Act