Question

Samuel was a promoter of a company called Edmanuals Pty Ltd. Six months before the company was registered Samuel signed a contract on behalf of Edmanuals Pty Ltd for $10,000.00 per month for 6 months for the hire of a 2005 CLS500 Mercedes Benz motor vehicle from Samuel’s Cars Pty Ltd. Samuel is the sole director and sole shareholder of Samuel’s Cars Pty Ltd. Edmanuals Pty Ltd does not want to honour the contract. Advise Edmanuals Pty Ltd. company law

2. Maree is an experienced accountant and audits the financial report of IOD Ltd. During the audit she suspects that a contravention of the Corporations Act 2001 (Cth) has occurred. What contractual duties does Maree owe IOD Ltd under the common law? What is Maree required to do if she suspects a contravention of the Corporations Act 2001(Cth)?

Giving an example, distinguish between the capacity of a company and the capacity of its agents. Your answer should highlight why the distinction is important. company law

Answer 1

Company and its agents to be treated as distinct persons but they will treated as related parties. In companies agents have limited liablity to the their share in company.

As per Companies act, one of any agent whether promoter or director can't purchase personal assets by name of company. It is violation of act which can be punishable under various laws.

If any agent do that, then he and company both are eligible for penalty and agent can be liable for imprisonment. and this will affect also goodwill of company.

If any auditor found this during their auditing then auditor should report the matter in CARO and put a qualificatio in report and also specify their obligations on not fulfilling the condition of companies act.

So both are doing their job in distinct capacity and the both have their own identity.