Company Law (overview od development of company law in cwc Caribbean)
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THE SALOMON PRINCIPLE OF WHAT RELEVANCE
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- Damages ;
- Kelner v Baxter
| Recession; restore parties to original position
Whatever contract was entered to has to be cancelled Bars to recission Time lapse- company take too long to bring action Affirmation- where the co. has adopted the contract If a third party has acquired a right to the subject matter Subject matter has been destroyed Damages ; seek for breach of fiduciary duty Restitution; order promoter to repay the company due to secret profits/ non- disclosure Suggest remedies the company can seek against the promoter Compensation is a form of remedy that an INDIVIDIUAL can bring against Under s 67 of the co act 1985 UK it provides for persons with a statutary right to claim compensation from promoters who were induced to take shares or debentures by an untrue statement in the prospectus Meaning that if persons based on the prospectus posted by the promoters and purchase shares and suffer a loss; they can individually bring an action against the promoter effect of Pre-Incorporation Contract on a company after it has been formed General rule: a company could never be made liable fo a pre-incrop. Contract Such contract entered into by a promoter would make the promoter personally liable Common law position: created confusion; Kelner v Baxter the promoters signed the contract with the other party ( supplier of wine) for and on behalf of the company; promoters were signing as agent of a company that was NOT YET FORMED and thus they were held personally liable Courts said promoter could not be an agent of a “principal” i.e. it did not exist yet Further said, after the company as formed, the Co. could not ratify action of promoter Co. sold wine thus adopted contract; but could not ratify a contract when they did not exist The only way it could’ve ratify contract THE COMPANY HAD TO BE IN EXISTANCE IN THAT TIME Newbourne: the promoter signed not as an agent but merely to authenticate a contract that he, the promoter, felt the co. was already a party to i.e. the promoter in this case never purported to be an agent of the company or for the company to be formed. Download 154.95 Kb. Share with your friends:
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