Random FLK1 P2

what must occur if the third-party is become the legal owner of shares?

Stock transfer form is sent to the stamp office.

What is required for a successful misrepresentation claim?

The statement must have induced the contract

Unincorporated business (no legal identity)

Sole traders and partnerships

Incorporated business (legal identity)

Companies and limited liability partnerships

What taxes do sole traders pay?

Income tax on their trading profits and capital gains tax on the capital gains

What does a director do?

They have general management powers to control the company does on a day-to-day basis; they run the company.

What does limited liability mean?

The members have a limit on their liability to contribute towards the companies debts and this may be limited by shares or guarantee.

Limited by shares

The liability of members (shareholders) is limited to any amount unpaid on their shares.

Limited by guarantee

The liability of members is limited to any amount they promised to pay in the event that the company is wound up.

An individual subscribe and pays for 100 £1 shares in a private limited company the company is wound up. What is the liability?

Nothing they hold the fully paid shares, but if payment had not been made or partially made, they would be liable for the balance.

Actionable misrepresentation

A false statement of fact that induces another party to enter into a contract.

What is the impact of duress or fraud on the performance of an existing contractual duty?

The courts will not enforce an otherwise enforceable agreement that has been induced by duress - good consideration, such as a practical benefit, does not apply with fraud/duress.

Must a solicitor account to clients for any financial benefit they receive as a result of their instruction, including referral fees?

Yes, under the SRA code of conduct.

customer due diligence - not a high value dealer but ‘occasional transaction’ worth €15,000

follow standard customer due diligence

high value dealer, when you make a payment to a supplier worth €10,000 or more

follow standard customer due diligence

high value dealer, when you carry out an ‘occasional transaction’ worth €10,000 or more

Standard due diligence

Reversing

This is where a court higher up in the hierarchy overturns the decision of a lower court on appeal in the same case.

Overruling

a court in a later case states that the legal rule decided in an earlier case is wrong.

Holdover Relief

Aka gift relief - the donor does not pay any tax on giving away or selling at an undervalue assets (incl. certain shares), but instead passes on the gain to the donee who pays CGT when they dispose of them.

Capital Gains Tax

tax on the profit when you dispose of an ‘asset’ that’s increased in value. It’s the gain you make that’s taxed, not the amount of money you receive (eg, buy for £5k, sell for £25k, CGT on £20k)

‘Calls for explanation’

Recognised relation from which influence is PRESUMED and will arise when the parties enter a transaction (reverse burden of proof)

Is land a specified investment?

No, think money, insurance, debt etc

What percentage must a shareholder own to have a right to ask the directors to call an extraordinary general meeting?

More than 5%