Thursday, September 20, 2018

PROMOTERS ARE GOOD FOR COMPANY AND DUTIES AND LIABILITIES


PROMOTERS ARE GOOD FOR COMPANY AND DUITES
-: PROMOTERS:-
"Promoter The promotion of a company is geared towards taking the necessary steps to find it."
  • (a) Definition:-
                        "promoter" is not defined in the Companies Act.
  •  Some attempts at definition have been made by the courts: Twycross vs. Grant  Whaley Bridge Printing Co vs. Green:-
                             If someone acts as a sponsor of a company, this is a fact and not a legal issue.
  • (B) Promoters Obligations:-
In the 19th century, it was common for property developers to sell their property at an inflated rate to a newly established company or acquire assets for the company and receive a commission from the seller.

 Then the courts began to impose a fiduciary duty on the Promoters similar to the agent tax. A promoter must disclose any benefit or potential conflict of interest to: 

  • (i) an independent director or 
  • (ii) existing or proposed shareholders.
  • (iii) Remedies for Failure by the Promoter:-If the Promoter has sold his property to the Company without disclosing it, the Company may terminate the Contract and reclaim the purchase price
  • (d) payment of the promoters:-
               A company can not conclude a contract before it is founded; a developer does not have it A legal claim against the company for fees and expenses.

              In Scotland, memoranda or articles of the company can be written with Willingness for the company, fees, and expenses for the promotion of Companies
  • (e) suspension of promoters:-
                         Disqualification Act for Business Managers of 1986, p.2 (1)
  1.             The court may issue a disqualification order against a convicted person
  2.             a useable offense in relation to promotion, training or management a company
  3.             The order can take a maximum of 15 years; is a disqualified person
  4.             prohibited to participate directly or indirectly in the promotion or training of a Companies

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