A paper which considers in detail the parameters of a company director's liability, with specific reference to misfeasance and fraud, and the relative merits of receivership and administration. Bibliography lists 20 sources.
Name of Research Paper File: JL5_JLcompcase.rtf
Unformatted Sample Text from the Research Paper:
by this case study, particularly those concerned with the responsibility and accountability of company directors, and the complex situations which can develop when one examines the relationship between a company
and its creditors, or when family members become involved in company matters. Perhaps it would be useful to begin with an overview of the structure and function of companies, in
British law, and the way that the law sees the role of directors.
At the most basic level, a company is simply an association between two or more people which constitutes
a legal entity. If the company is "limited", such limitations refer to the personal liability of the companys officers: a private limited company, such as that in the case study,
is one in which the individuals concerned usually act as directors and secretary, and may also be shareholders. The essential element of the company, from the legal point of view,
is that it is an autonomous entity in law, having the ability to own property, enter into contractual obligations, incur liabilities, and so on.
The companys creditors have a claim only on
the companys assets, which are separate and distinct from any personal assets which the directors may have. The shareholders own the company, whilst the directors and secretary are responsible for
managing it: however, it is quite possible in small companies for the directors to also be shareholders. Although it is not legally possible to have fewer than two people forming