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Company Law Question Paper

Company Law

Course:Bachelor Of Commerce

Institution: Kenyatta University question papers

Exam Year:2008

KENYATTA UNIVERSITY
UNIVERSITY EXAMINATIONS 2007/2008
INSTITUTE OF OPEN LEARNING
EXAMINATION FOR THE DEGREE OF BACHELOR OF COMMERCE

BBA 401: COMPANY LAW
DATE: Tuesday 8th January 2008

TIME: 10.30am-12.30pm
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INSTRUCTIONS:
Answer question ONE and any other TWO questions

Q1.
(a)
Discuss the grounds upon which a petition for the compulsory winding up
of a company may be presented to the court.

[10 marks]
(b)
Under what circumstances may the directors of a company be made to
contribute to the assets of a company on winding up.
[10 marks]
(c)
What policy reasons lead to the protection of shareholders against the
creditors of a company in winding up?

[10 marks]

Q2.
“The presumption of regularity cannot be relied on by „insiders? i.e persons who
by virtue of their position in the company are in a position to know whether or not
the internal regulations have been observed”. Discuss.

[20 marks]

Q3.
Celicon, a Kenyan company leads a group which includes many wholly owned
subsidiaries. Some of these engage in matatu business. On 12th December 2006
one of the matatus called Inter-city Haulers was involved in an accident in which
several people suffered serious injuries. They were amounted damges by the
High court amounting to 5 million shillings. Inter-City Hauliers? assets are worth
about 1 million shillings. The victims of the accident have come to you for advice

1
on whether they can attach the assets of Celicon ltd to make up the difference.
Advise them.

[20 marks]

Q4.
Directors owe a duty of care to the company but not to the shareholders
individually. Discuss.

[20 marks]

Q5.
Would you accept the view that the role governing the maintenance of capital of a
company are archaic and need to be overhauled to bring them in line with the
reality of the commercial world?

[20 marks]

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Company Law Question Paper

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