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Notes

Presentation Notes
Module

Company Law (MN20010)

41 Documents
Students shared 41 documents in this course
Academic year: 2021/2022
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Mansi Mulchandani
University of Bath
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1 – introduce case and explain context and definition of Partnership

2 – CAN expel S stands alone and states “x”. There must be express provision in a contract to expel. One in partnership deed. Provision upon which entire action will be enacted. Article of Association – express agreement within partnership deed regarding expulsion.

3 – All partners of partnership owe duties. Pat breached as didn’t act with care and skill. Redeeming -> contracts & payments cancelled. Severe implications as 20% of revenue lost. Emphasise he did not act with care and skill. He did not exercise the level of care that’s expected of a competent member of the profession as one would not partake in this action knowing the consequences.

4 – 3 questions to consider. Provision in PD justifies removal of Pat, within express power. All partners exercise same power, votes = authority. Majority = expulsion can take place.

Expulsion on behalf of R&R is best interest, sense of distrust and negative financial implications. Restore trust and work on finances.

Nat justice. Heard and given notice.

6 – court’s expulsion: Carmichael v evans - a partner was convicted of travelling on the railway without a ticket and with intent to defraud the railway company, not good faith. Similarly, Blisset v Daniel - one partner encouraged the other partners to vote in favour of an expulsion so he could acquire his share in the partnership at a very low price. This power was exercised solely for a financial gain, and not exercised in good faith so the court did not uphold this expulsion.

Pat decided to redeem debentures, injure reputation & lead to financial problems. Own personal gain. Valid reason to vote expulsion, not exercised in good faith of the company, and their power to vote for expulsion would be in best interest of firm.

7 – When terminating Pat’s contract, must be aware of s, which sets out above rights

Pat contains rights. Conscious to not infringe rights, such as stating that not upheld responsibilities. When conducting termination, there must be consciousness in regards to them to not suffer consequences of misstating the breach in his responsibilities.

8 – Of many forms of termination, by notice is the way they can choose to enact, no parthership deed regarding it.

According to act, full partner may terminate by giving notice. Can be oral unless agreement specifically required written notice, which it didn’t. Must be exercised good faith:

Peyton v. Mindham - there was an existing deed stating the the partnership could be terminated by notice if either partner was incapacitated for more than 9 consecutive months. Contrast, can terminate by notice as no agreement/deed. Good faith cause company can go into liquidation cause 20% of revenue lost, and neg financial implications.

9 – another solution, termination by court. Can dissolve partnership under court order.

Stated in s35 of act, ‘...’

In this case, Pat behaved in such a way that it is not reasonably practical for the other partners to be in business with him. – Carmichael v Evans

In this case, Pat’s conduct was prejudicial to the business’s finances and therefore the partnership has the right to be terminated by court.

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Notes

Module: Company Law (MN20010)

41 Documents
Students shared 41 documents in this course

University: University of Bath

Was this document helpful?
1 – introduce case and explain context and definition of Partnership
2 – CAN expel S.25 stands alone and states “x”. There must be express provision in a contract to
expel. One in partnership deed. Provision upon which entire action will be enacted. Article of
Association – express agreement within partnership deed regarding expulsion.
3 – All partners of partnership owe duties. Pat breached as didn’t act with care and skill. Redeeming
-> contracts & payments cancelled. Severe implications as 20% of revenue lost. Emphasise he did not
act with care and skill. He did not exercise the level of care that’s expected of a competent member
of the profession as one would not partake in this action knowing the consequences.
4 – 3 questions to consider. Provision in PD justifies removal of Pat, within express power. All
partners exercise same power, votes = authority. Majority = expulsion can take place.
Expulsion on behalf of R&R is best interest, sense of distrust and negative financial implications.
Restore trust and work on finances.
Nat justice. Heard and given notice.
6 – court’s expulsion: Carmichael v evans - a partner was convicted of travelling on the railway
without a ticket and with intent to defraud the railway company, not good faith. Similarly, Blisset v
Daniel - one partner encouraged the other partners to vote in favour of an expulsion so he could
acquire his share in the partnership at a very low price. This power was exercised solely for a
financial gain, and not exercised in good faith so the court did not uphold this expulsion.
Pat decided to redeem debentures, injure reputation & lead to financial problems. Own personal
gain. Valid reason to vote expulsion, not exercised in good faith of the company, and their power to
vote for expulsion would be in best interest of firm.
7 – When terminating Pat’s contract, must be aware of s.24, which sets out above rights
Pat contains rights. Conscious to not infringe rights, such as stating that not upheld responsibilities.
When conducting termination, there must be consciousness in regards to them to not suffer
consequences of misstating the breach in his responsibilities.
8 – Of many forms of termination, by notice is the way they can choose to enact, no parthership
deed regarding it.
According to act, full partner may terminate by giving notice. Can be oral unless agreement
specifically required written notice, which it didn’t. Must be exercised good faith:
Peyton v. Mindham - there was an existing deed stating the the partnership could be terminated by
notice if either partner was incapacitated for more than 9 consecutive months. Contrast, can
terminate by notice as no agreement/deed. Good faith cause company can go into liquidation cause
20% of revenue lost, and neg financial implications.
9 – another solution, termination by court. Can dissolve partnership under court order.
Stated in s35 of act, ‘…’
In this case, Pat behaved in such a way that it is not reasonably practical for the other partners to be
in business with him. – Carmichael v Evans
In this case, Pat’s conduct was prejudicial to the business’s finances and therefore the partnership
has the right to be terminated by court.

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