Question
Sam and Lorna are both directors of Lucky Sdn Bhd. The Object clauses of Lucky Sdn Bhd consist of the following: (i) to manufacture cosmetics;
Sam and Lorna are both directors of Lucky Sdn Bhd. The Object clauses of Lucky Sdn Bhd consist of the following:
(i) to manufacture cosmetics;
(ii) the packaging of all hygiene products; and
(iii) to carry on any other business, which is the company is of the opinion is ancillary to the above businesses.
Recently Lucky Sdn Bhd entered into a contract with Beauty Sdn. Bhd. to open a beauty school at Bukit Damansara. The decision was approved by both Sam and Lorna. Debbie a debenture holder of the company is unhappy with the decision and felt that this contract is ultra vires of the Lucky Sdn Bhd's business.
Answer the following:
(a) If the investment on opening a beauty school is considered ultra vires.
(b) Advise if Lucky Sdn. Bhd. will be able to enjoy unlimited capacity with references to the Companies Act 2016
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Cost Accounting A Managerial Emphasis
Authors: Charles T. Horngren, Srikant M. Datar, Madhav V. Rajan
15th edition
978-0133428704
