Company law Essay Example | Topics and Well Written Essays - 1500 words - 3

Company righteousness - Essay ExampleThrough the legal frameworks, entrepreneurs who wish to speed companies are guided in matter pertaining to establishing and running the companies. The formation of a bon ton may be seen under the law as separate from the standstill of persons in that it can be held responsible under certain circumstances to be distinct and thus be liable in civic business in which the persons forming it fail to take responsibility. Whenever the persons forming a company fail to perform or deliver as expected in terms of responsibilities and tax conformation, a company stands as a legal person who can take limited liability and who can equally be held responsible under law. Furthermore, the founding of a company as a legal entity confers the company the power to form associations with other companies to form corporate whose responsibilities upon dissolution must be over(p) through a certificate of dissolution in order to avoid future responsibilities charge d over it as a legal person. Under the UK law (CA 2006) provisions, companies are interpreted to be separate from their directors and shareholders and under very few circumstances are companies taken in a common sense with their controllers (Commune, 2006, p.3 Anon, nd, check bit 1-4). Nevertheless, under certain conditions and provisions, the director or the persons running the company may be interpreted to be part and thus be held responsible for the fortune of debts and other liabilities. Such instances may be whenever the director(s) may owe the company on shares or in form of assets. Under such discussion, a company owns property and assets distinctly from the proprietors and as such, the directors and the shareholders have no, legal provision to take any property from the company even though they may be having a hundred percent shareholding capacity. This therefore implies that future management has power to sue any previous director under the circumstances of mishandling the company though it belonged to them. On the other hand, the UK law also acknowledges that a company is tout ensemble responsible for its liabilities and debts and under such, the directors or even shareholders have no obligation to pay a companys debts (Masons, 2010, para 1-3). The legal framework of the United Kingdom acknowledges three types of companies two of which are private companies but limited by guarantees or by shares and then the public limited companies. This paper intends to substantiate the authenticity of the company being a distinct entity or a different person from the persons who form it under the law as provided for under the United Kingdom 2006 company law frameworks (Anon, nd, para 1-5). In understanding a company as a distinct person or entity within the countrys framework, we shall consider a number of case studies under which, a company is wholly held responsible to argue its way out in instances of legal procedures where the directors or shareholders are n ot held responsible for any eventuality. Case 1 Mr. Smith envisions and starts a company, which is limited by shares. Besides registering it under his sole directorship, he equally decides to buy a share from the company worth one pound and does it by full payment and as such, his share becomes fully bought. The company records