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Thank you Vish and many congratulations on passing your final exam. Thank you also for your donation 🙂
All the very best of good fortune in your future career
Each in turn:
1) This is clearly incorrect. If there are no ‘distributable profits’ then the preference shareholders will probably discover that the directors fail to propose a preference dividend. Even though a dividend is not paid, for it to be ranked as a liability, it must as a minimum be declared … but then not paid. In addition, although most preference shares are classed / issued as ‘cumulative preference shares’ it is possible to issue preference shares that are not ‘cumulative’. The expression ‘cumulative’ tells us that, where in any particular year the preference dividend is not paid (even though it has been declared), the unpaid dividend from one year will roll up into subsequent years when hopefully there will be sufficient distributable profits to finance the accumulated dividends.
2) According to legislation, dividends may only be financed by ‘accumulated realised profits less accumulated realised losses’. Thus it can clearly be seen that accumulated losses from earlier years must be taken into account when calculating the distributability of this year’s profits.
3) It is the one of jobs of shareholders in general meetings to approve the dividend proposed by the directors. It’s part of the ‘ordinary business’ of an AGM. It IS possible (although I’ve never heard of it happening!) that the attending and voting members at an AGM may approve a dividend LOWER than that proposed by the directors. But the dividend approved cannot be greater than the dividend proposed by the board.
4) the depreciation charged on the increased amount of the revalued asset is treated as a realised profit when computing ‘distributable profits’.
So, in summary, the correct answer should be option 3.
Well done
Zainab, sorry, but this should be on a new thread!
Taking each of the 4 possibles in turn:
1) True. The clue is in the wording. Remember, we’re talking about ‘wrongful’ dismissal suggesting that there is something ‘wrong’ in the form of the dismissal. And dismissal without giving ‘proper notice’ is clearly ‘wrong’! Therefore the statement is true.2) For wrongful dismissal, the period of employment is irrelevant. Thus this statement is incorrect!
3) ‘Dismissal without justifiable reason’ follows the same reasoning as option 1) above. There’s not a proper reason for the dismissal and therefore the dismissal is wrongful. So the statement is not incorrect and is therefore not the answer to the stem question.
4) Same as option 2), it is correct that there is no minimum period of employment requirement. In cases of wrongful dismissal, period of employment is irrelevant.
So, in summary, your recollection about ‘2 years’ is incorrect. In fact, NO minimum period of employment is required. So the answer is NOT option 4). It’s option 2)! (Phew, that was lucky!)
OK?
For a private company it’s whatever the Articles say but not less than 90%and not more than 95%
Hi
I’ve also checked the question in the English Law Flash Cards and … you’re correct. I’ve asked Admin to change the answer. Incidentally, the same error is in the Global Law Flash Cards and I’ve asked for that to be amended also.
Thank you for pointing out this slip
Companies Act 2006, section 307 (2a) tells us that the notice period is 21 days for a company’s AGM. I’ll check out why I have it as 14 days
Are you sure that you have replicated the question correctly?
DAP – delivered at place involves the seller’s responsibility up to the delivery port. But the buyer accepts the risks associated with unloading.
DDP – delivered duty paid involves the seller in all responsibilities up to delivery at the specified location. In this case, it’s the nominated Port of Durban.
DPU – delivered at place unloaded involves the seller accepting responsibility and risk of not only unloading but also all export and import duties
CPT – carriage paid to (place of destination) again involves the seller in accepting responsibility for export taxes
So none of these options exactly fits exactly the Marco / Mischa situation.
The question asks: “What is the most suitable Incoterm from Marco’s perspective?” By process of elimination, options A, C and D seem to be less suitable than option B.
But I don’t like the question 🙁 I believe that the specified location Port of Durban swings it for me. That, and the agreed variation to the incoterm such that Mischa takes on the risk of export and import costs and duties.
Is that OK?
For DAP, Marco has accepted the task of unloading whereas, under DAP, that unloading risk should be Mischa’s.
For DDP, Marco carries the risk up to the delivery of the goods to the specified location (Port of Durban). Again, Marco accepts responsibility for unloading but ‘exchanges’ that risk by insisting that Mischa accepts the import and export costs.
DPU doesn’t fit our case because import and export costs are taken on by Mischa whereas, under DPU, these are costs associated with the seller.
Under CPT, the seller is responsible for export duties whereas Mischa has taken on the responsibility.
Much, much better Zainab. A proper heading that will help others decide whether they wish to read your question and my answer.
Looking at each in turn (although some are clearly more obvious that others!)
a) engaging in trade union activity – this is automatically unfair. Joining a trade union, taking part in union activities, even a refusal to join a union – these are all classed as unfair grounds for being dismissed
b) I’ll come back to
c) dismissal on transfer of employment to a new undertaking – surely common sense tells us that the employee has the right to choose the organisation for which they wish to work. To treat an employee as though they were a commodity to be bought and sold, or transferred, without their acquiescence flies directly in the face of the underlying principle of place of employment is the employee’s choice
d) redundancy – clearly if an employee is redundant, then dismissal won’t be unfair. There MAY be a claim that ‘redundancy’ a contrived excuse by the employer and would / could be disputed in a tribunal. But per se, redundancy is not automatically unfair.
Which leaves us with option b) – constructive dismissal. We’re in the situation where, for example, the employer doesn’t pay the employee, or they force the employee to make unreasonable changes to how they work (eg to work night shift when the employment contract is for day shift work) or the employer allows other employees to treat you unfairly by harassment or bullying.
BUT!!! The decision to terminate the employment is the decision of the employee (and, incidentally, that decision should be taken as soon as the employee feels that they are being constructively dismissed. To allow the new status quo to continue could be claimed by the employer to be the acceptance of the new situation by the employee)
The action to end the employment contract in options a), c) and d) is the action of the employer whereas the action for cessation caused by constructive dismissal is the decision of the employee. As for d) and the action by the employer, the situation is claimed by the employer to have been forced upon the employer as a result of an accumulation of circumstances leading to the employee being redundant
How’s that?
Zainab, thank you so much for your good wishes – they obviously worked – I slept very well 🙂
Glad that we are now sorted out with partners’ liabilities for partnership debts. I’m pleased and relieved to hear that.
Zainab, 2 points re your second question
1 These threads are there to assist not just you but any other Law student that is struggling to grasp the concepts of what’s involved. But without giving some indication of the subject matter in the thread heading, the threads are not going to be at all useful. A heading of ‘Need Help’ is not telling anyone which area of law is about to be disseminated. Much better for the previous question would have been, for example ‘Limited Liability Partnerships’. OK
2 Because this second post is about employment law and, particularly, unfair dismissal it will ideally be the subject of a new separate thread with a heading like ‘Unfair dismissal’.
So I’m going to ask you to repost it in a new thread. It’s now fast approaching midnight in my part of the World so I’ll not likely get to answer it until after I have enjoyed my beauty sleep. But I shall answer it 🙂
Tomorrow!
OK?
Zainab, NO partner is unlimitedly liable for the partnership debts in a Limited Liability Partnership.
Designated members have obligations and responsibilities beyond those imposed on the non-designated partners. But, as the article says, in practice, all the members of a LLP tend to be designated. Their ‘additional’ obligations include matters like liaising with auditors, compliance with legislation … – as illustrated in the article. But the WHOLE concept of the beast that is a LLP is that partners are NOT faced with the possibility of personal bankruptcy.
In exactly the same way that a shareholder / member is not liable for the company’s debts, a member of a LLP is not liable for the partnership debts.
This is NOT the same as the liability of the general partners in a Limited Partnership (ie not an LLP). In a limited partnership, the general partners are wholly liable for the partnership debts but the limited partners are not similarly liable … UNLESS they take an active part in the running of the firm in which case they BECOME liable for the firm’s debts and liabilities incurred during the period of their active participation.
How are we doing now?
Is that ok now? I sincerely do hope so because I’m feeling guilty – my answers appear to confuse you even more than when you started. Look at that link that I sent in my last response and, as usual, if you’re still not happy, post again
You are so right! It is confusing – a bit!
I put your question into AI and AI tells me that designated members DO have unlimited liability. Now I KNOW that that is not correct so I’ve pursued it further and found this website that I believe will fully and clearly answer your confusion.
Try this:
https://www.qualitycompanyformations.co.uk/blog/difference-ordinary-designated-llp-members/
If you’re no clearer after this, let me know.
OK?
No – if I have understood your post correctly. The idea of an LLP is that the liability of the members of the LLP shall have limited liability (hence the name)
So there is no equivalent minimum number of liable partners – LLP no partner is unlimitedly liable. In a LP, there must be at least one general partner.
Is that clear now?
Oh Zainab! There really is no need to double post! Just the one post to start a question thread is sufficient 🙂
Hi
Option 1 – yes a LLP must be registered with the Registrar of Companies but it is NOT necessary for it to have a WRITTEN agreement – so option one is incorrect
Option 2 – the fundamental idea behind the existence of a LLP is to safeguard the partners from unlimited liability. So, yes, it IS a separate legal entity distinct from the identities of its members
Option 3 – following on from option 2, the idea is to protect the partners from unlimited liability. And therefore, as a consequence, it is NOT necessary for there to be at least one general partner with unlimited liability.
It seems to me that you are confusing the two separate animals a ‘limited liability partnership’ and a ‘limited partnership’.
In a limited partnership, it IS necessary for there to be at least one general partner with unlimited liability … but that’s not what this is related to!
OK?
You are very welcome, and I look forward to further ‘interesting’, ‘thought-provoking’ questions 🙂
Hm! On first sight, I can see why you might think that there is an offer somewhere in there, and that therefore there ought to be an acceptance.
Can we, straight away, get rid of options A and D? A response to a request for information (option A) is not an offer (the Bumper Hall Pen case) and, if it is isn’t an offer, then option D cannot be acceptance.
Now, option C. IF (and it’s a big IF) Franz’s reply of ‘Not less than $30,000’ is an invitation, and Oskar’s payment was an offer, again, we have a problem? Acceptance must be complete and unconditional and the introduction of ‘delivery within 7 days’ by Oskar is a material alteration to the original offer … if there, in fact, is an original offer. So, if you want to view Oskar’s remittance as an offer and not as an invitation, that’s OK. But, if that’s the case and it is an offer, it must be in a final form that is capable of valid acceptance … and the delivery deadline introduction replaces any original offer and makes this now into a counter-offer
Let’s go back to basics! Request for information, invitation, offer, acceptance.
‘asking for the lowest price that it would charge for a specific car model’ – clearly, a request for information and no legal consequences.
As a result of the receipt of the information requested, Oskar makes an invitation (by sending the remittance) inviting Franz to make an offer. But Franz doesn’t make an offer, and Oskar hasn’t made any offer. So, no offer, no acceptance, no contract.
IF Franz delivers within 7 days – what’s the issue? BUT the delivery within 7 days cannot be viewed as an acceptance because …. no offer exists capable of acceptance.
Option C cannot be correct and therefore, by default, Option B must be correct
OK?
NB this would be better on the Ask ACCA Tutor forum – that way I would be certain of seeing it!
IF all goes well and Franz is happy to receive $30,000, then what’s the issue? It’s only if there is a subsequent dispute that any of this lands in the lap of the legal profession!
You’re very welcome Melinda and many congratulations on passing the Law paper
Here we go! Home at last 🙂
Sujin, I have copied Section 580 of Companies Act 2006. I think that this should help particularly the last 6 words of S580 (2)
“580 Shares not to be allotted at a discount
(1) A company’s shares must not be allotted at a discount.
(2) If shares are allotted in contravention of this section, the allottee is liable to pay the company an amount equal to the amount of the discount, with interest at the appropriate rate.”
OK now?
This second issue of shares is different from the first issue. In that first issue, Gus was always liable to pay the uncalled amount. However, in the second issue, the directors informed Gus that the total amount payable for each share would be 40c.
Issue 1 was an issue of $1 shares, 75c paid (and a further 25c payable when the directors called up that 25c balance)
Issue 2 is clearly an issue at a discount (” ….. he would only have to pay a total of 40 cents for each $1 share.”) and the balance of 60c is now payable together with interest at the appropriate rate as per Section 580
All clear?
