INSTRUCTION:

Answer the question below. Your answer should be supported with relevant Articles / Sections from Statute Law/ Legislation and Case Law/Cases.

Question 1

John is setting up a company which is to be named Jasmine Ltd. During the pre-incorporation period, John signed various contracts on behalf of the company. After a few months, there were some issues concerning one of the contract where John took a loan from A Bank. The contract was later void.

Once set up, Jasmine Ltd has a constitution whose object clause provides for the company to sell pizza. Last week some shareholders decided to alter the company's articles of association (AA) to include trading in durians. Also included is suggestion to alter the status of the company to an exempt private company so that the public are unable to comment on the financial status of the company.

The original constitution provides that any alteration requires the voting of all the shareholders of the company. Two of them are overseas and their whereabouts cannot be found.

Advise John if he is liable for the pre-incorporation contract?(25 marks)

With regards to alteration of the constitution, the shareholders wish to apply to court to alter the constitution. Advise Jasmine Ltd.(25 marks)

Question 2

Dodo Sdn Bhd is having a meeting in two months. Michael, who is a member of this company appoints a proxy, Derek to attend the meeting as he is unable to attend it. Derek attends the meeting but he was stopped from taking a vote at the poll.

Further to that, Dodo Sdn Bhd invested in a futures contract with a geological company to mine minerals offshore Kerteh. Dodo Sdn Bhd invested heavily in this project. Due to the Covid 19 pandemic, the project was called off. Dodo Sdn Bhd suffered massive losses due to this. The company's constitution stipulates that when Dodo Sdn Bhd reaches a position when it is unable to function financially, the company must then be dissolved.

Michael would like to know if he has a case against Dodo Sdn Bhd for not allowing Derek to be his proxy.(25 marks)

Michael seeks your advise if an ordinary resolution can now be passed to wind up Dodo Sdn Bhd.(25 marks)

[Total: 100 marks]