BỘ TÀI CHÍNH Đề thi kết thúc học phần
HỌC VIỆN TÀI CHÍNH Môn: Luật 2 (ICAEW CFAB)
Đề chẵn Thời gian làm bài: 60 phút
Question 1: True or False. Explain each statement.
1. All promoters are subcribers of the company.
2. The director can only make contracts on behalf of the company within his actual
authority.
3. Public company can pass written resolution.
Question 2:
1. Take an example about the case, in which the agent has apparent authority.
2. Take an example about the breach of fiduciary of the company secretary.
3. Take an example of a company that use debenture to raise money.
Question 3: Brick Lane Ltd Co. is a real estate company in London.
1. Because of its business activities, the company wants to list shares on the stock
exchange.
Comment on this behavior of Brick Lane Ltd. Co.
2. There are 3 promoters of Brick Lane Ltd. They are Jenny, Coleb and Kell. In order to
help the company's operation be stable and smooth, they assigned: Kell registered certain
documents with the Registrar of Companies. Jenny found the head office, Coleb found
employees for the company. Coleb had contracted to rent an office in the Green Lock
building as the company's headquarters, the rent is $ 60,000/year and the lease term is 3
years. After 2 years, the company made a loss and could not pay the rent. The landlord
asks Coleb to pay, but he refuses. The landlord sues Coleb in court.
In your opinion, does Coleb have to pay that money? Why?
3. Brick Lane Ltd. Co has a factory in Cadiff. On May 1, 2024, the Company borrowed
$ 100,000 from Stanley Bank and took a floating charge on its factory. Then, on
November 27, 2024, the company continued to borrow another $ 50,000 at Barclays Bank
and take a fixed charge on that factory. However, the company made a loss and could not
pay these debts when they were due. The factory was auctioned off and earned $ 130,000.
Please present priority of payment for the above debts and explanation.
BỘ TÀI CHÍNH Đề thi kết thúc học phần
HỌC VIỆN TÀI CHÍNH Môn: Luật 2 (ICAEW CFAB)
Đề lẻ Thời gian làm bài: 60 phút
Question 1: True or False. Explain each statement.
1. Anyone can become the company secretary in UK.
2. In UK, to be incorporated, every companies must be registered under the Company Act
2006.
3. The agency relationship is created only by a written agreement.
Question 2:
1. Take an example about the company “off – the – shelf”.
2. Take an example about the apparent authority of the director
3. Take an example about the pre – incorporation contract.
Question 3: Brick Lane Ltd Co. is a real estate company in London.
1. Because of its business activities, the company wants to list shares on the stock
exchange.
Comment on this behavior of Brick Lane Ltd. Co.
2. There are 3 promoters of Brick Lane Ltd. They are Jenny, Coleb and Kell. In order to
help the company's operation be stable and smooth, they assigned: Kell registered certain
documents with the Registrar of Companies. Jenny found the head office, Coleb found
employees for the company. Coleb had contracted to rent an office in the Green Lock
building as the company's headquarters, the rent is $ 60,000/year and the lease term is 3
years. After 2 years, the company made a loss and could not pay the rent. The landlord
asks Coleb to pay, but he refuses. The landlord sues Coleb in court.
In your opinion, does Coleb have to pay that money? Why?
3. Brick Lane Ltd. Co has a factory in Cadiff. On May 1, 2024, the Company borrowed
$ 100,000 from Stanley Bank and took a floating charge on its factory. Then, on
November 27, 2024, the company continued to borrow another $ 50,000 at Barclays Bank
and take a fixed charge on that factory. However, the company made a loss and could not
pay these debts when they were due. The factory was auctioned off and earned $ 130,000.
Please present priority of payment for the above debts and explanation.
ĐÁP ÁN THAM KHẢO
ĐỀ CHẴN
Question 1 1. All promoters are subcribers of the company.
(3 marks) This statement is false.
A promoter may or may not be a member of a company. They are
associated with the company even before it comes into existence. When
the company is getting incorporated, the promoters may subscribe to the
Memorandum of Association of the company. Then, they will
automatically come under the definition of subscribers and will be
expected to perform the duties of and enjoy the rights of subscribers.
Whereas, for a subscriber, there is no pre- condition that the person shall
be a promoter for the company.
2. The director can only make contracts on behalf of the company
within his actual authority.
This statement is false.
The director has the authority to act on the company’s behalf to enter
into the contract, then the contract will be binding on the company.
There are two types of authorities relevant to this case, actual authority
and apparent authority.
3. Public company can pass written resolution.
This statement is false.
A public company is a limited company expressly registered as a public
company under the Act. The Company Act 2006 restricts public
companies from passing written resolutions, and their shareholder
resolutions must always be passed at a general meeting. This is even if
the public company’s articles of association authorise written
resolutions.
Question 2 1. Take an example about the case, in which the agent has apparent
(3 marks) authority.
Olga is the director of Quinn Ltd. The company is considering repairing
the office to improve its workplace environment. Olga, act on behalf of
her company, enters into a contract of £15,000 with XZY for office
repair service.
XYZ performs the contract since he believes in good faith that Olga
possesses authority to carry out this action when such authority does not,
in fact, exist. The board knew about Olga’s general activities and
permitted her to engage in these kinds of activities.
In other words, Olga had no actual authority to employ XYZ, but he had
apparent authority because, with the knowledge of the BOD, he had
acted throughout the transaction as if he possesses authority and his
action in engaging XYZ was within the usual authority.
The director, therefore, had apparent authority and bound the company.
2. Take an example about the breach of fiduciary of the company
secretary.
Canons is the Colbolt’s company secretary. He has actual authority to
sign contracts connected with the administrative side of the company‘s
affairs. He enters into a contract of £1,250 for transportation service
during your business trips. Canons was, in fact, lying and used them
himself. Then, this action was discovered by Castle, a company director.
Canons is prosecuted. Canons orders cars that had been given for an
improper purpose. So he is in breach of the breach of fiduciary of the
company secretary
3. Take an example of a company that use debenture to raise money.
Alyn plc wanted to raise money to build a new factory. The company
issued 2,000 Debentures on 01 January 2005 which are redeemable after
5 years. £100 each with interest rate of 12% per annual, payable on 31
December every year. The public applied for 1,800 debentures and the
applications were accepted. All money was received (£100 x 1,800 =
£180,000)
Question 3 1. Because of its business activities, the company wants to list share
(4 marks) on the stock
Brick Lane Ltd Co. is registered private limited company.
The principal differences are that a public company is subject to more
stringent rules and regulation than private companies and that only a
public company can offer its securities to the public. The private
company is prohibited from offering itssecurities to the public.
Thus, unless Brick Lane chooses to convert itself into a public
company, it cannot list shares on the stock.
2. In your opinion, does Coleb have to pay that money? Why?
Coleb, a promoter, had contracted with third parties for renting an office
so that once the certificate of incorporation is issued the company can
begin trading. It is a pre-incorporation contract.
A pre-incorporation contract is a contract made on behalf of the
company before incorporating.
Coleb has to pay the rent since the following reasons:
- The company cannot be bound by pre-incorporation contract entered
on its behalf,
- The company cannot ratify the contract since it did not exist when the
contract was made,
- The company cannot be sued or sued by the contract, and
- The contract takes effect in the same way as one made with promoters
and they are personally liable.
3. Please present priority of payment for the above debts and
explanation.
Where different charges over the same property are given to different
creditors, their priority must be determined. A fixed charge ranks higher
than existing floating charges unless the floating charge expressly
prohibits the creation of another charge over the same property and the
person taking the later fixed charge knew that this was the case. Stanley
Bank may seek to protect themselves by prohibiting the company from
creating a subsequent fixed charge over factory. In the absence of such
a clause the fixed charge will rank first since, although created later.
Thus, Barclays Bank is paid in full of $50,000 and the Stanley Bank
only the balance remaining out of £130,000 realised from the factory
($80,000).
ĐÁP ÁN THAM KHẢO
ĐỀ LẺ
ĐỀ CHẴN
Question 1 1. Anyone can become the company secretary in UK.
(3 marks) This statement is false.
Because:
+ With the public company, a person want to become a secretary need
have suitably qualified, such as: ACCA, ICAEW...
+ With the private company, a person want to become a secretary
needs no qualification.
2. In UK, to be incorporated, every companies must be registered
under the Company Act 2006.
This statement is true.
On this day incorporated under the Companies Act 2006 as a private
company, that the company is limited by shares, and the situation of its
registered office is in England and Wales.
3. The agency relationship is created only by a written agreement.
This statement is false.
An agency relationship can be created by a written or verbal agreement,
or it can even be implied through the actions and conduct of the parties
involved.
Question 2 1. Take an example about the company “off – the – shelf”.
(3 marks)
Sarah is a small business owner who wants to expand her business
into a new market. She has heard about "off-the-shelf" companies and
decides to purchase one instead of forming a new company from
scratch. Michael is a company formation agent who specializes in
setting up "off- the-shelf" companies. He has a number of pre-
registered companies available for sale, and Sarah decides to purchase
one of them. After Sarah chooses the company she wants to purchase,
Michael transfers the share to her and resigns as the original director
and secretary of the company. He then ensures that a new director and
secretary are appointed to the company and notifies Companies House
of his resignation. Sarah can now begin operating her new business
immediately, using the pre-existing company structure. This saves her
time and effort in setting up a new company from scratch, and allows
her to focus on growing her business in the new market.
2. Take an example about the apparent authority of the director
Z is an electronics trading company, A is both a major shareholder and
a CEO. When Z Pld suffered a loss, in order to have money, A signed a
loan contract with Bank C on behalf of the company and received a
floating fee. However, when the payment was due, Z Plc refused to pay
the bank, believing that A could not enter into a contract with C bank
without the approval of the BOD as stipulated in the company's articles
of association C Bank sued Z Pld and demanded that Z Pld pay C Bank
the borrowed money. The court held that A has the apparent authority,
so A has the right to sign the contract, and Z is legally obligated to pay
C Bank that loan.
Jonh is a diretor of MAC company and he has the authority of making
decision in day to to day operation with the budget within 120.000 $.
However, in May MAC has to renew its rent contract, the contract
costed 100,000 last year.
In the follonwing year, the rent has increase into 150.000$. Jonh decided
to continue to sign the contract without asking the permission of the
BOD.
When Jonh signed the contract in the next payment period, when he
presented the statement to the accountant, the other directors noticed an
increase in rent. The company refused to pay, and only accepted to pay
$100,000
In this case, he overlord his authority and had a apparent authority
3. Take an example about the pre – incorporation contract.
ABC Company was in the process of being formed to purchase land
and develop it for settlement. Before the company was incorporated,
Tom and John are promoters, entered into a contract with Jack for the
purchase of coal mining rights on the land intended to develop. The
contract was expressly made subject to the incorporation of the
company. After the company was incorporated, ratified the contract
and began purchasing coal from the Jack. However, a dispute arose
over the quality of the coal, and the company refused to pay for some
of the shipments.
Jack sued the company for breach of contract.The court held that
because the contract was expressly made subject to the incorporation
of the company, it was not binding on the company until after it was
incorporated and had ratified the contract. However, the court also
held that the promoters who signed the contract on behalf of the future
company were personally liable for any breach of the contract that
occurred before the company was incorporated.
Question 3 1. Because of its business activities, the company wants to list share
(4 marks) on the stock
Brick Lane Ltd Co. is registered private limited company.
The principal differences are that a public company is subject to more
stringent rules and regulation than private companies and that only a
public company can offer its securities to the public. The private
company is prohibited from offering itssecurities to the public.
Thus, unless Brick Lane chooses to convert itself into a public
company, it cannot list shares on the stock.
2. In your opinion, does Coleb have to pay that money? Why?
Coleb, a promoter, had contracted with third parties for renting an office
so that once the certificate of incorporation is issued the company can
begin trading. It is a pre-incorporation contract.
A pre-incorporation contract is a contract made on behalf of the
company before incorporating.
Coleb has to pay the rent since the following reasons:
- The company cannot be bound by pre-incorporation contract entered
on its behalf,
- The company cannot ratify the contract since it did not exist when the
contract was made,
- The company cannot be sued or sued by the contract, and
- The contract takes effect in the same way as one made with promoters
and they are personally liable.
3. Please present priority of payment for the above debts and
explanation.
Where different charges over the same property are given to different
creditors, their priority must be determined. A fixed charge ranks higher
than existing floating charges unless the floating charge expressly
prohibits the creation of another charge over the same property and the
person taking the later fixed charge knew that this was the case. Stanley
Bank may seek to protect themselves by prohibiting the company from
creating a subsequent fixed charge over factory. In the absence of such
a clause the fixed charge will rank first since, although created later.
Thus, Barclays Bank is paid in full of $50,000 and the Stanley Bank
only the balance remaining out of £130,000 realised from the factory
($80,000).
