SQE2 mistakes

Terminated director form

TMO1

Appointeted director form

AP01

Change registered office

AD01

Update when changing directors (2)

1. register of directors

2. The register of directors' residential addresses

Drafting business board meetings and named a person who is going to be appointed - put in brackets

(who has indicated his willingness to act)

special resolutions (3)

1. change company name

2. change articles of association

3. disapplying pre-emption rights

No PA but you want to end the partnership - can you retire?

no - only dissolve

No PA but you want to end the partnership - alternatives

1. Buyout

2. Sub partner

3. Treat Capital as Loan

to dissolve partnership, serve

intention to dissolve the partnership

dissolving parntership mens it will be

sold as a going conern OR the assets will be individually sold to pay off liabilities

escape liability for bank loans made as partner when leaving via

novation agreements which usually need a substitute partner

the only grounds for appeal of sentence in CC is

manifestly excessive

CC in appeal carries out a

full rehearing of the case using only evidence that was available in the first instnace

credit for guilty plea is under

s 73 sentencing code

breach of contract claim must prove (7)

1. there was a contract

2. there was an implied term

3. there was a breach

4. there was a loss

5. the breach casued the loss

6. the loss was not too remote

7. the duty to mitigate was upheld

implied terms Sale of Goods Act (5)

1. Seller has right to sell the goods

2. goods correspond to the description

3. goods are of a satisfactory qualtiy, subject to objective test

4. goods are fit for purpose

5. goods correspond in qulaity to the sample

can you contract out statutory implied terms under the sale of goods act?

Yes, everything but the right to sell the goods, can be contracted out subject to UTCA requirement of reasonableness

Supply of Goods and Services Act implied terms (3)

1. Reasonable care and skill

2. reasonable time of performance

3. reasonable consideration (charge)

Consumer Rights Act is for

individuals not businesses

Consumer RIghts Act implied terms (5)

1. Satisfactory quality

2. reasonably fit for purpose

3. as described

4. matching smaples

5. matching models seen or examined

There are multiple owners of property and one is dead. the rest are trying to sell

Overreach the beneficial interest by paying purchase money to at least 2 other owners AND see her death certificate

Missing conveyance - ask for (4)

1. further details

2. restrictive covenant indemnity insurance

3. assign the insurance to the buyer

4. If none, pay for the policy to cover the buyer as there is a defect in the title

Searches standard (5)

1. CON29

2. LLC1

3. Drainage and water

4. environmental

5. chancel repair

CON29

Planning permission, highways, building reg

LLC1

Local land charges - listed buildings, TPO

draingage and water is for (2)

1. public water supply and sewer system connections

2. checking location of drains and if any run under the property

environmental search is to

identify contaminated land, flood risk, landfill

chancel

liability to pay for repairs to a local parish church

location specific serarches (7)

1. Mining

2. common registration

3. crossrail

4. floodrisk

5. planning search

6. energy

7. land registry map index

Mining search when

in area with mining history or risk of subsidience

Common registration for

common land or village green

crossrail if

near London or on HS2 route

flood risk

for high risk flood area

planning search

detailed info on surrounding planning applications

energy search

infrastructure - wind farms, power stations

land registry index map search is only for

unregistered land to confirm what is and isnt registered

if CON29 shows a path is not a public highway - options (4)

1. Negotiate with whoever it belongs to [PIM search]

2. evidence of express easement

3. evidence of prescription easement (20 years)

4. grant an easement/lisence

statutory renewal of buisness lease over 6 months for purpose of business via

security of tenure under Landlord and Tenant Act

circumvent LTA (3)

1. contract it out

2. enancy at will - expressly ecluded from LTA but can be termintated at any point = uncertain

3. 2 short 6 month leases

if the alteration to the will is made after exection, look for evidence of ____________otherwise the alterations are invalid

valid execution (signature/ intitials)

does estrangement have an effect on the gifts if there was no formal divorce

no

statutory claim for disappointed beneficiaries under a will via

Inheritence (Provision for Family and Dependants) Act 1975

Inheritence (Provision for Family and Dependants) Act 1975 is for what type of provision?

reasonable

Inheritence (Provision for Family and Dependants) Act 1975 Standing (6)

1. spouse/ civil partner

2. former spouse/civil partner who has not remarried

3. current partner who has cohabited in the same household for at least 2 years before death

4. child

5. treated as child

6. either wholly or in part maintained by the deceased

Inheritence (Provision for Family and Dependants) Act 1975 time

within 6 months of the grant of represenataion being granted

Inheritence (Provision for Family and Dependants) Act 1975 what does that court take into consideration (5)

1. what is reasonable for the applcant?

2. current and future needs

3. age

4. able bodied

5. earning themselves

equity financing is the injection of

capital into a company by the allotment of new shares

equity finance advantages (3)

1. no repayment obligation

2. no risk of a charge defalt causing the company to lose their assets

3. new shareholders diversify decision-making with fresh perspectives

equity finance disadvantages (4)

1. time and money - paperwork and admin

2. dividend payout cost

3. dividend payout is divided and dilutes current shareholder earning

4. diluted decision making

debt financing

arranging funding by borrowing money

most debt creditors will ask for a

charge over the business - fixed, mortgage or floating

advantages of debt financing (4)

1. Interest on debt is tax deductible

2. debt does not dilute ownership

3. predictable and manageable repayment schedule

4. possibility of negotiating terms of contract with lender

disadvantages of debt financing (3)

1. interest & principal must be paid regardless of how the firm is performing

2. excessive debt increases risk to equity holders

3. assets can be lost if there is a security charge over them

resturcturing debt options (3)

1. informal restructuring agreement

2. Creditors voluntary agreement

3. administration

Informal Restructuring Agreements AIM

To ease the company's cash flow without entering a formalised agreement.

Informal Restructuring Agreements ADVANTAGES 5

1. repayment schedule based around cash flow

2. No administrative cost

3. No hassle of court proceedings and formalised agreements.

4. Prevents the involvement of a third-party administrator or insolvency practitioner

5. Allows retained management control over their own decisions.

Informal Restructuring Agreements DISADVANTAGES 2

1. subject to negotiation

2. not legally binding

creditors voluntary agreement is a

legally binding debt restructuring with certainty in terms of negotiated debt repayment, managed by insolvency practioner

creditors voluntary agreement advantages (2)

1. business continues operating

2. legally binding

creditors voluntary agreement disadvantage

requires 75% unsecured creditor agreement - high threshold

administration is a formal procedure with 3 aims:

1. To rescue to the company.

2. failing this, to better creditor outcome

3. failing this, to conduct asset realisation with the goal of maximising returns to creditors by selling assets for cash

who appoints an administrator for administration?

the board

advnatages of administration (2)

1. immediate moratorium

2. potential recovery permitted

disadvantages of administration (2)

1. shifts management control entirely to the administrator

2. significant costs that come with administration would impact creditor returns

Winding up solutions (2)

1. Memebers voluntary liquidation

2. Creditors voluntary liquidation

MVL will distribute the assets to the

shareholders so the company must be sovlent for this to happen

CVL is initiated by the shareholders passing a

special resolution

CVL is a structured process of

liquidation that minimises liabilities by relieving directors of ongoing management responsibilieis

CVL advantage

preserve the reputation of the company from what would look like the most responsible approach to the debt.

CVL disadvantage

limits return for shareholders

compulsory liquidation is a court-supervised process that can be initiated by

any creditor petitioning against the business so that they can be put into liquidation and the debt repaid

When a director is interested in a transaction (2)

1. formal declaration

2. abstain from voting at board meeting

subtantial value transaction

purchase of non-cash asset that is:

1. over 10% company value

2. over £100k

SVTs require

shareholder ordinary resoltuion approval

Can shareholders with a person interest in the matter vote at a meeting?

yes - unless that articles state otherwise

if an SVT is not approved,

1. voidable

2. account to company on the profit made via purchase

Buyback of shares from profit (8)

1. Check the articles of association for restrictions

2. hold a board meeting to:

   • determine the financing method

   • approve the terms of the buyback contract

   • call a general meeting of shareholders

3. hold general meeting to pass ordinary resoltuion to approve

4. enter into buyback contract

5. pay full consideration

6. file with Companies House within 28 days

7. cancel shares

8. update register of persons of control/ register of members

can a shareholder interested in the buyback by PROFIT vote?

no

Is VAT chargeable on UK B2B services?

yes - 20% always

Is VAT chargeable on Non-EU services (e.g., US client)?

No - outside UK VAT scope

Input VAT recovery is allowed on:

business expenses with valid invoice

Can you reclaim foreign VAT (e.g., Spanish hotel)?

Not via UK VAT return - but you can via EU law

When must a medium/large company file audited accounts?

9 months after year- end

Penalty for late filing audit accounts

fines; risk of strike-off.

what type of company can buyback shares via capital?

private only

buyback of shares via capital steps

1. Check articles for restrictions

2. board meeting to:

   • approve draft terms

   • commision auditor report

   • prepare directors solvency statement

3. shareholder meeting to pass via special resolution

4. file at companies house within 15 days

5. cancel shares

6. update register

director's solvency statement includes a declaration that (2)

1. the company will remain solvent for 12 months post-buyback

2. no grounds to expect insolvency

libaility for false statements in declaration of solvency is

personal

declaration of solvency must be

signed by all directors within 15 days of shareholder vote

can interested shareholders vote on buyback out of capital?

yes

if capital buyback violates the companies act (3)

1. voidable transaction

2. civil penalties for directors

3. criminal penalties for false solvency statements

sentencing reduction statute

s 73 sentencing act

first day of trial reduction for guilty plea

1/10

custody threshold test

offence is so serious that no fine/ community order is adequete

if a client plans to lie (3)

1. advise against

2. cease acting if they insist

3. never mislead the court, even by omission
   

pre-trial guilty plea discount

up to 1/3 reduction

guilty plea made during trial

judge’s discretion - anywhere between 1/10 and 0

cracked trial plea = avoids trial but pleads guilty after the trial date is set discount

1/4

theft is basic, indictable or triable either way?

either way

test for dishonesty in theft is objective or subjective?

subjective