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ANSWERING SCHEME FOR BUSINESS AND COMPANY LAW MIAQE EXAMINATION QUESTION

SECTION A

QUESTION 1

(a) Explain the extent of the application of the English common law and the rules of equity as applied in Malaysia today.

Answer:

Section 3(1) of the Civil Law Act, 1956 states that the courts in Peninsular Malaysia shall apply the common law of England as well as equity as administered in England on April 7, 1956. In the states of Sabah and Sarawak, the common law of England and the rules of equity together with the statutes of general application shall be applied. However, the application of English law throughout Malaysia is subject to two limitations:

(i) It is applied only in the absence of local statutes on the particular subject. Local law takes precedent over English law as the latter is meant to fill the gaps (lacuna) in the local system.

(ii) Only that part of the English law that is suited to local circumstances will be applied. The provision to section 3(1) of the Civil Law Act, 1956 is the authority for this. It states that the common law, rules of equity and statutes of general application shall be applied so far only as the circumstances of the states of Malaysia and their respective inhabitants permit, and subject to such qualification as local circumstances render necessary.

(b) In relation to the law of contract:

(i) Explain the meaning of the terms intention to create legal relations between the parties

(3 marks) Answer:

An agreement is not a contract in the strict sense unless it is the common intention of the parties that it shall be legally enforceable. Choo Tiong Hin & Ors v Choo Hock Swee.

Such intention is normally implied or presumed from the nature of the agreement.

(ii) Explain the implication of the element of certainty to a contract.

Answer:

Agreements, the meaning of which is not certain, or capable of being made certain, are void.

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In the case of Karuppan Chetty v Suah Thian, where the parties agreed upon the granting of a lease at RM35.00 per month for as long as he likes, the court held that the requirement of certainty was not met.

(c) Briefly explain damages as one of the important remedies available for breach of contract.

Answer:

Remedies for breach of contract: Damages: Section 74 of the Contracts Act, 1950 provides damages to be granted to a party as compensation for the damage, loss or injury he has suffered through a breach of contract.

The illustrations to Section 74 clearly indicate that the party may recover damages for:

Other expenses incurred as a result of the breach; The loss of profits arising out of the breach; and The difference between the price of goods as contracted for and the actual price the

goods were sold for as a result of the breach.

The plaintiff is only allowed to recover a reasonable sum for breach of contract (Section 75, Contracts Act, 1950) and is required to prove the actual damage he has suffered.

(d) In sale of goods, the general rule is that, no one can give a better title than he has himself:

(i) Explain the general rule above;

Answer:

The maxim, nemo dat quod non habet means that where goods are sold by a person who is not the owner and without the consent of the original owner, the buyer acquires no better title than the seller had.

(ii) State three exceptions under this rule.

Answer:

Estoppel the buyer will obtain good title if the owner is precluded by his conduct from denying the sellers;

Sale by merchantile agent in the ordinary course of business, the buyer will obtain good title;

Sale by joint-owner; Sale under a voidable title the buyer will obtain a good title if he buys in good faith

and without notice of sellers defect of title; Sale by a seller in possession after sale; Sale by buyer in possession.

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QUESTION 2

(a) List six (6) exceptions to the general principle that an agent cannot delegate the authority given to him by his principal.

Answer:

The six exceptions are: Where the principal approves or consents to the delegation of the authority; Where it is presumed from the conduct of the parties that the agent has the power to

delegate his authority; Where the custom or practice of the trade or business permits delegation; Where the nature of the agency is such that delegation of the authority to another

person is necessary to complete the business; In case of necessity or an unforeseen emergency; or Where the act to be done is purely ministerial or clerical and does not involve the

exercise of discretion.

(b) Amat, an agent was authorised by Chong to buy a consignment of rice at the price of RM3.00 per kilogram. During the purchase, Amat came across a better quality rice which was priced at RM3.50 per kilogram. Without further informing Chong, Amat decided to purchase the better quality rice although the price is higher than that authorised by Chong. His intentions were so that Chong would be able to resell the rice at a higher price and make more profit. Amat made arrangements for the purchase under his own name. Chong however, failed to take delivery of the rice and the seller sues Amat for breach of contract.

Advise Amat whether he (as an agent) may claim from Chong with regards to the claims made against him by the rice seller.

Answer:

In this situation, Amat has actually exceeded his authority when he decided to purchase the rice at a price higher than that authorised by his principal (Chong). It is noted that he made this decision without notifying his principal. This situation may be ratified had Chong agreed to proceed with the purchase at the said price. The contract of agency cannot be said to have been ratified even though Amats intentions were in the interest of Chong.

An agency by ratification may arise in any one of the following situations:

o An agent who was duly appointed has exceeded his authority; or o A person who has no authority to act for the principal has acted as if he has the

authority.

When any one of the above situation arises, the principal can either reject the contract or accept the contract so made: Section 149, Contracts Act, 1950.

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When the principal accepts and confirms such a contract, the acceptance is called ratification and it may be expressed or implied. Section 150, Contracts Act,1950. In this situation, Amat has exceeded his authority but Chong never affirmed his actions in this respect when Chong did not take delivery of the goods. The fact that Amat made the arrangements under his own name had also absolved Chong from any liability under the circumstances.

In conclusion, Amat could not claim against Chong for any losses that he may incur in relation to the above situation.

Cases: Keighley Maxsted & Co. V Durrant [1901] AC 240 S.R.M. Meyappa Chettiar v Lim Lian Koo [1954] 20 MLJ 246

(c) Man engages a forwarding agent by the name of Parjo, to transport a consignment of some fabric from Bandung to Malaysia. Arrangements were made so that the consignment is to be carried by sea and to be landed at a place in Tanjung Kupang, Malaysia. This is not an official commercial port of entry into Malaysia. The reason for this is so that Man could avoid paying import tax to the Malaysian government. Parjo was instructed to unload the consignment at a certain secluded place near Tanjung Kupang. Upon arrival at the Malaysian shores, Parjo proceeded to unload the consignment. While he was at it, Parjo was arrested by the Malaysian authorities and the consignment was confiscated. Parjo was charged with illegally bringing in taxable items into Malaysia and evading import taxes. Parjo was found guilty and paid a hefty fine for the offence.

Parjo seeks your advise whether he may claim any indemnity from Man in relation to the losses he suffered since he had acted as Mans agent.

Advise Parjo.

Answer:

This case involves the principles on agency. When Man engages Parjo to do something, Man is the principal and Parjo is his agent. In the absence of an express contract, the employer of an agent is bound to indemnify the agent against the consequences of all lawful acts done by the agent in exercise of the authority conferred upon him: Section 175, Contracts Act, 1950.

Parjo is advised that he cannot recover the losses he had suffered since the act which he was employed to do, is a criminal act (i.e. evading import duties and bringing in goods into Malaysia without permission of the authorities). By virtue of Section 177 of the Contracts Act, 1950: where one person employs another to do an act which is criminal, the employer is not liable to the agent, either upon an express or an implied promise, to indemnify him against the consequences of that act.

Section 176 of the Act however, does provide for situations where agents may be indemnified against consequences of acts done in good faith, although it cause injury to the rights of third persons. In this situation, had Parjo not known that the act of which he was arrested for was against the law, he may claim to have done the act in good faith or out of innocence. This was not the case, however, since Parjo should have been aware of the transgression of law that he is committing, being a forwarding agent himself.

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Therefore, Man is not liable to indemnify Parjo due to the fact that the act done by Parjo was unlawful. In this situation, Parjo will have to bear the losses on his own.

QUESTION 3

(a) (i) Liabilities of partners for wrongful acts or omissions in the course of business:

Section 12, Partnership Act, 1961:

Where any wrongful act or omission of any partner acting in the ordinary course of the business of the firm or with the authority of his co-partners, loss or injury is caused to any person not being a partner in the firm, or any penalty is incurred, the firm is liable thereafter to the same extent as the partner so acting or omitting the act.

In this situation, Amin as a lawyer was negligent and had incurred a penalty to be paid by their client. This incident happened in the course of the partnership business. Conveyancing transactions which includes the sale and purchase of properties is indeed within the business scope of a legal firm. Since Amin is a partner of the firm, the partnership may most probably be liable for the extra cost incurred by the client as a result of Amins negligence.

(ii) On the 1st of November, 2012 the accounting firm of Jessup & Associates entered into an agreement with a building contractor to renovate their office. On the 1st of January 2013, Ali joined the firm as a partner. He signed a partnership agreement which among others, states that he agrees to be liable for the existing debts of the partnership at the time of his admission. Ali however, never read the agreement prior to signing it. The firm later faces some financial difficulties and failed to pay the building contractor. The contractor sues the partnership as a whole as well as the individual partners, including Ali.

Advise Ali, whether he is liable for this particular debt of the firm.

Answer:

Section 19(1), Partnership Act, 1961:- A new partner who has just been admitted into a firm is not liable for the debts incurred prior to his admission. However, if the new partner agrees to be liable for the existing debts of the partnership at the time of his admission, he would be liable.

Under this circumstances, it is clear that the firm had incurred the debts against the building contractor prior to Ali becoming a partner of the firm. Based on this observation, Ali may not be liable for the debts of the firm, as per the provision of Section 19(1) of the act. However, Ali did sign a partnership agreement upon his admission to the partnership which entails his agreement to be bound and liable for the firms existing debts. Although Ali never read the relevant terms of the agreement, he would still be bound by the terms of the agreement. This in turn, invokes the second limb of Section 19(1) which states that the partner would be rendered liable for the firms existing debts prior to his admission if he had agreed to be so bound.

Therefore, due to the agreement signed by Ali, he shall be liable for the debt owing to the building contractor as a partner of the firm as well as individually.

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(b) State two (2) methods where a partnership may be dissolved by operation of law (unless otherwise agreed by the partners).

Answer:

(i) Section 34(1) (a) of the Partnership Act, 1961:

If the partnership was entered into for a fixed term and the term expires, then the partnership is deemed to have come to an end at the expiry of the specified term. This however, may not take effect if the partners decide to carry on with the partnership business and activities after the expiry of the fixed term.

(ii) Section 34(1)(b) of the Partnership Act, 1961:

If the partnership was entered into for a single adventure or undertaking, upon the completion of such adventure or undertaking, the partnership expires; or

(iii) Section 34(1)(c) of the Partnership Act, 1961:

If the partnership was entered into for an undefined time, by any partner giving notice to the other partner(s) of his intention to determine (or end) the partnership.

(c) John had engaged Bakri, an advocate and solicitor to act for him in the purchase of land from one Chan Po Po for RM30,000. Bakri had prepared a sale and purchase agreement on 12 June 2012 and the sale was completed on 6 July 2012. In a Gazette Notification no, 13 dated 15 March 2011, the land had been gazetted for acquisition by the government, under Section 8 of the Land Acquisition Act, 1960.

Evidence revealed that Bakri did not make a search enquiry with the Collector of Land Revenue in the Land Office concerned and thus was not aware of the gazette notification.

On 3 January 2013, John was paid RM15,000 by the government for the acquisition of the said land. John claims damages amounting to RM15,000 being the difference between the purchase price and the compensation.

Advise John.

Answer:

Duty of care may arise in contract, tort or by reason of a statute and may be owed by the professional to a client or a third party.

The duty of care of a professional depends very much on what the professional is employed to do for the client. Lamphier v Phipos [1838] 8 C&P 475

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In this situation, Bakri as a professional was employed to execute the purchase of a land by John. Under the circumstances Bakri was duty bound to ensure that the transaction can be carried out in accordance with his clients request. In this situation, he has a duty to ensure that his client would eventually acquire title and ownership of the land so purchased or advise accordingly if such a transaction could not be effected due to whatsoever reason(s). Bakri had failed in his duty to take reasonable care and skill in giving his advise as demanded of a normally competent and careful practitioner. His failure to conduct the search enquiry was blatantly negligent. Bakri is liable, as a professional man professing special skill who gives assistance to another. He also owes a duty of care to John whom he knows had relied on his skill as a professional.

Therefore, John may succeed in claiming the RM15,000 in damages for the loss he had suffered in the above transaction.

Cases: Neogh Soo Oh & Ors v G. Rethinasamy [1984] 1 MLJ 126 Manjit Singh s/o Gurdial Singh v R.K. Nathan [1984] 2 CLJ 113 Bank Bumiputra Malaysia Berhad v Yeoh Ho Huat [1979] 1 MLJ 30

SECTION B

QUESTION 4

(a) See Section 20 (1), no act or purported act of a company, and no conveyance or transfer of property to re by a company shall be invalid by reason only that it is ultra vires.

In Malaysia doctrine of ultra vires is much diminished because of s.20 (1) CA. However companies are still expected to act within the scope of the objects clause.

Ultra vires concept: any act by a company which is not specified by its objects and powers regarded as

ultra vires, and under common law regarded as null and void. cannot be ratified. However, under s.20 (1) CA, the transaction although beyond

companys capacity can still be valid. S.20(2) the common law doctrine is not entirely abolished, it can be relied on: by a member to restrain an executory ultra vires transaction -S.20(2)(a) by company/member against present/former directors for permitting company to

enter into ultra vires transaction - S.20(2)(b) by the Minister to wind up the company - S.20 (2)(c)

To avoid complexities of ultra vires act/transaction, could alter objects to provide for the new activity.

(b) Section 4 of the Companies Act 1965 defines a company limited by shares as "a company formed on the principle of having liability of its members limited by the memorandum to the amount, if any, unpaid on the shares respectively held by them.

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Advantages

The liability protection to its shareholders, limited their exposures to the amount of share capital that they subscribed for. Once the shares are fully paid there is no further liability.

The simplicity to transfer existing shares or issue additional shares to new investors. Existing member can transfer his shareholding, wholly or partially, through selling of his shares.

An entrepreneur is more likely to start a business if he/she knows the potential liability is limited.

Disadvantages

Many administrative requirement are imposed, for example in preparing and keeping the financial statements (which must be audited).The companys financial affairs will be accessible by the public.

At least one company secretary is required to manage its statutory submissions and returns as well as attending and preparing minutes for board and shareholders meetings.

Incorporation cost is high, and there are yearly recurring fees to be paid such as audit, accounting, company secretarial and tax fees.

(c) Decisions at shareholders' meetings are taken by resolutions upon which members can vote. There are different sorts of resolution.

Ordinary resolution

An ordinary resolution is can be passed by simple majority ("bare majority") of the votes cast in meeting. The length of notice will depend on the length of notice of the type of meeting at which it is to be passed.

Special resolution

The requirements of a special resolution are dealt with section 152 (1). A special resolution can only be passed by a three- quarters majority of votes (in person or by proxy) cast in a general meeting who are entitled to vote at general meeting at which not less than twenty one days notice was given. The notice of the meeting at which it is to be tabled must state the intention of the proposers to propose the resolution as a special resolution. A printed copy of special resolution shall be loadge with ROC within one month of its passing (section 154(2). Failure to comply is an offence carrying a default penalty (section 154(3)).

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Written or "circular" resolution

The law enables shareholders of private companies to pass resolutions without having to attend a meeting by way of written resolutions by using the procedures under section 152A. A resolution passed by using this procedure is deemed to have been passed at the registered office on the date on which the last member signed the relevant document (section 152A (2)).

(4 marks)

(d) (i) The content of the articles of association create a contract between the company and its members. Nonetheless, provisions in the articles which confer rights on outsiders are not enforceable by the outsider. Thus Mr. William will not succed in suing Fastmode Bhd in failling to continue his service.

However if there is a separate contract between Fastmode Berhad and Mr William and the contract contains the same terms as contained in the articles, Fastmode Berhad cannot avoid its contractual obligations under the separate contract by altering its articles of association. Hence Mr William can sue Fastmode Bhd for damages for breach of contract. See: Southern Foundries (1926) Ltd v Shirlaw (1940). The House of Lords held that the company was in breach of the separate contract it made and liable to pay damages.

(ii) According to section 31(2) CA 1965, the alteration of an article will take effect on the day the special resolution is passed or a later date mentioned in the resolution itself. Its effectiveness does not depend on the lodgement of the resolution with the ROC. Once the alteration is effective, the new article will bind all members of the company, including those who voted against the resolution.

(2 marks)

(e) A Pre-incorporation contract simply is a contract purpotedly entered into on behalf of a company before its incorporation. It must be noted that before incorporation, a company has no contractual capacity.

Prior to Songket Sutera Sdn Bhd registration in 2010, a company as a legal entity does not exist. At this stage, neither Songket Sutera Sdn Bhd can enter into contracts nor can it appoint any person (Amira) to enter contract on its behalf. Hence, contract made between Amira and Bakri on 15 May 2009 its called pre-incorporation contract.

Therefore, at common law, a company is not bound to any contract made prior to its incorporation Newborne v Sensolid (Great Britain) Ltd. At common law, a company is also not capable to ratify any pre-incorporation contract Kelner v Baxter.

The common law position discussed above have been modified by Section 35(1) and (2) of Comapnies Act 1965.

Section 35(1) outsiders (Bakri) may enforce the pre-incorporation contract against the company (Songket Sutera) after it is registered, but only if the company has ratified the contract after its registration.

Section 35(2) outsider (Bakri) may enforce the pre-incorporation contract against the person (Amira) who executed the contract on behalf of the non-existent company and that person (Amira) shall be personally liable if the company fail to ratify the contract after its registration.

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The Act is silent on how ratification of pre-incorporation contract should be made. However, in Ahmad Bin Salleh v Rawang Hills Resort Sdn Bhd, it is suggested that a

board resolution that has the effect confirming that the company has adopted the pre-incorporation contract will suffice.

Section 35(2) This provision indirectly ensures that the promoter shall cause the company to ratify

the contract. If not, he will be personally liable unless there is an express agreement to the contrary.

As for Hamzah, a contract entered on 17 December 2012 between him and Amira on behalf of the Songket Sutera Sdn Bhd was made after the company's incorporation on 16 November 2012. Hence Hamzah's claim against Amira Sutera Sdn Bhd might be successful. (5 marks) (Total: 20 marks)

QUESTION 5

(i) Assets subject to fixed charges as opposed to floating charges cannot be dealt with while subject to the charge, except with the consent of the creditor holding the charge. The assets subject to a fixed charge cannot be dealt freely in the course of business. Venture Bhd is not free to sell, lease or in anyway deal with the land without Zest Bank Bhd express permission. Assets subject to fixed charge are identified at the time of creation of the charge, and the assets subject to the charge will not flactuate over time unlike a floating charge.

(3 marks)

(ii) Disadvantages of a floating charge under the Companies Act 1965. The assets subject to a floating charge may be utilised to pay off certain preferential creditors, if the company does not have sufficient funds to pay them. See: ss.191 and 292(4) Companies Act 1965. Floating charges created within six months of the commencement of a winding up will be invalid except to the amount of cash paid to the company at the time of, or subsequent to, the creation of the charge, unless the company was solvent immediately after the creation of the charge. See: s.294 Companies Act 1965.

(3 marks)

(b) In the exercise of their powers, the Act provides that a director must act honestly and use reasonable diligence at all times [section 132(1)]. If something is done honestly, it is considered to be done in good faith. As a director Maria owes a statutory duty to the company not to place herself in a conflict of interest and duty situation. As a result she is required to formally declare he interest to the board. In addittion, the shareholders must approve the sale by passing an ordinary resolution which requires a simple majority to vote in favour.

The duty toact honestly includes the duty to act in the best interest of the company and to avoid conflict of interest. The director must not put himself in a position where his duty and interest conflict. There must be total absence of any intention to seek an

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unfair advantage for herself or persons connected to him or to defraud the company.

Apart from the above, a director is also obliged to disclose the interest he has in any transaction involving the company to the board of directors and the shareholders at general meeting. Failure to disclose to the board is an offence under the Companies Act 1965. Failure to disclose to the shareholders at general meeting will enable the company to set aside the contract or to obtain an account of profit from the director.

(4 marks)

(c) (i) Section 167 of the Companies Act 1965 - Every company and the directors and managers must keep such accounting and other records that would enable true and fair profit and loss accounts and balance sheet to be prepared from time to time. This obligation is applicable to all types of companies.These accounts must be prepared in accordance with Malaysian Accounting Standards. The responsibility of the Board is to ensure that the accounts are laid or tabled before shareholders at the annual general meeting. The accounts must be laid before the company at its annual general meeting, in case of the first account, within eighteen (18) months after the company's incorporation, and subsequently once in every calendar year at intervals of not more than fifteen months.

The accounts must be made up for the period since the preceding account to a date not more than six months before the date of annual general meeting.

(3 marks)

(ii) Details that should be incorporated in the accounts:

A profit and loss account; and A balance sheet as at the date to which the profit and loss account is made-up; A directors' report; An auditor's report; Notes to the accounts; and Group accounts (if applicable)

(2 marks)

(iii) A company must lodge an annual return for each year. This annual return must be in accordance with the Eighth Schedule of the Companies Act 1965. The annual return must be lodged within one month after the annual general meeting of the company.

This return must include:

. A copy, certified by a director, manager or secretary of the company, to be a true copy of the accounts which have been audited by the company's auditors; and A certified copy of the report of the auditors;

.

Companies with an "exempt-private" status at the date of the return, may include with the annual return a certificate of an exempt private company signed by the director, the secretary and the auditor of the company, instead of the copy of accounts of the company. Directors may be prosecuted for not filing these documents or for late filing of these documents. If convicted, directors may be liable to a fine. If there has been conviction, directors may also be disqualified from being directors or taking part in the

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management of a company. If the accounts and/or annual returns are delivered late the company will be charged with penalty for late filing.

(3 marks)

(d) Based on Part VI CMSA 2007, prospectus means a notice, circular, advertisement or document inviting applications or offers to subscribe for or purchase securities or offering any securities for subscription or purchase and unless expressly specified, includes a supplementary prospectus, replacement prospectus, shelf prospectus, short form prospectus, profile statement, supplementary shelf prospectus and abridged prospectus. (Part VI CMSA, Section 226 of the Capital Markets and Services Act 2007). Section 226 CMSA explains the invitation or offer to suscribe or purchase share or securities is prospectus. Based on the case of Edgington v Fitzmaurice (1885), a company issued a prospectus which means a document inviting subscriptions for debentures.

(3 marks) (Total: 20 marks)

QUESTION 6

(a) A promoter undertakes the incorporation of a company and sets it going. His duties are fiduciary in nature and he is under an obligation to act bona fide for the benefit of the proposed company. He should not put himself in a position where his personal interests will conflict with his duty to the proposed company. Thus he is not allowed to make secret profits.

A promotermay enter into pre-incorporation contracts. These are contracts which are entered into prior to the company's formation. Such contracts shouldbe made in the company's interest and a promoter should not make any secret profits out of such contracts. Section 35(1) of the Companies Act 1965 states that such contracts may be ratified by the company after its formation. Uponratification, the company shall be bound and entitled to the benefits thereof as if it had been in existence at the date of the contract. Prior to its ratification, section 35(2) provides that the promoter will be personally liable unless his personal liability is specifically and clearly excluded.

At common law, a company is not bound to any contract made prior to its incorporation Newborne v Sensolid (Great Britain) Ltd. At common law, a company is also not capable to ratify any pre-incorporation contract Kelner v Baxter. The common law position discussed above have been modified by Section 35(1) and (2) of Comapnies Act 1965.Section 35(1) outsiders may enforce the pre-incorporation contract against the company after it is registered, but only if the company has ratified the contract after its registration. Section 35(2) outsider may enforce the pre-incorporation contract against the person who executed the contract on behalf of the non-existent company and that person shall be personally liable if the company fail to ratify the contract after its registration.The Act is silent on how ratification of pre-incorporation contract should be made.

(7 marks)

b) The appointment of receivers on new contracts of the company depends on how the receiver is appointed. Receivers appointed by the court are personally liable on contracts entered into in the course of carrying on the company's business because, as independent officers of the court, they are not agents of either the company or the

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debenture holder but contract as principals. However, if a person is appointed under the debenture, the instrument under which he is appointed will normally provide that he is the agent of the company and as such he would not normally be personally liable for the new contracts.

The appointment of the receiver does not automatically terminate all employment contracts which the company has entered into with its employees until and unless one of the following qualifications as set out in Griffiths v Secretary of State arise: Where the receiver enters into a new contract of employment with the employee; Where the business of the company is sold; or.Where the continued services of a particular employee is inconsistent with the role and functions of the receiver.

(6 marks) (c) Conditions for restraining order include the following: -

Refer to s.176 (10A) read with s.176 (10).

Where Court is satisfied there is genuine proposal for compromise or a scheme of arrangement between the Company and its creditors representing at least one half (1/2) in value of all creditors.

Restraining order necessary to enable Company and creditors to formalize scheme for approval of creditors.

Statement of Companys affairs made up to a date not more than 3 days before to application is lodged.

A person nominated by a majority of creditors must be made in the application to act as a director.

Once restraining order granted s.176 (10C) any disposition of the Companys property, other than those made in the ordinary course of business would be void.

(5 marks) (d) Refer to s.150 CA

Possible to hold general meeting in the absence of all directors subject to Court Order.

S.150 empowers the court a meeting to be called, held and concluded in such manner as court thinks fit. Court can act on its own motion or on the application of any director or of any member of the Company.

(2 marks) (Total: 20 marks)