A-one law firm v.

Front line Law firm

Liberty land is a country which has adopted the principle of liberal economic in its laws and

policy. Its constitution, statutes, rules, regulations all has been guided by free economic

principles.

Ajaya formed the company, Ajays Air Farming Ltd under liberty land. He is the citizen of

liberty Land. He owned all the shares of the company except one. He was the companys sole

governing director. He was also employed by the company as its chief and only pilot.

Liberty Land is a mountainous country where in a very short range there are huge mountains. To

fly a plane in the sky of liberty land is really a risky job. One day unfortunately, Ajaya was killed

while flying for the company. His wife made a claim for compensation under compensation

legislation of liberty land. Her entitlement to such compensation depended on whether or not he

was a worker ie. a person who has entered into a contract of service with an employer.

The High Court of Appeal refused to hold that Ajaya was a worker, holding that a man could not

in effect, employ himself.

Now the case has come into the Apex court of Liberty land.

The questions to be decided by Apex Court are:

1. Whether or not Ajaya may have distinct personality from the company where he has hold

almost all share?

2. Whether or not Ajaya can enter into the contract with his own company and could be

considered as a employee or not?

3. Whether or not his widowed wife is entitled to compensation?

Likewise, Dikchya started her business of boot manufacturing as a sole proprietorship. After 4

years of running business she transferred her business to a company (Dikcya Pvt. Ltd.)

incorporated with members comprising of herself and her family. The price for such transfer was

paid to Dikchya by way of shares, and debentures having a floating charge (security against debt)

on the assets of the company. Initially the company was doing great sharing profit to its member.

But unfortunately due to the armed conflict started in Liberty land the company business failed

and it went into liquidation, Dikchyas right of recovery (secured through floating charge)

against the debentures stood a prior to the claims of unsecured creditors, who would, thus, have

recovered nothing from the liquidation proceeds.

To avoid such alleged unjust exclusion, the liquidator, on behalf of the unsecured creditors,

alleged that the company was sham, was essentially an agent of Dikchya, and therefore, Dikchya

being the principal, and was personally liable for its debt. In other words, the liquidator sought to
overlook the separate personality of Dikchya Ltd., distinct from its member Dikchya, so as to

make Dikchya personally liable for the company's debt as if she continued to conduct the

business as a sole trader.

On the same day The High Court of Appeal refused to hold that Ajaya was a worker, holding

that a man could not in effect, employ himself, the High Court in the case of Dikchya ruled that

the company is a myth, reasoned that Dikchya had incorporated the company contrary to the true

intent of the then Companies Act of liberty Land, and that the latter had conducted the business

as an agent of Dikchya, who should, therefore, be responsible for the debt incurred in the course

of such agency.

Now this case has also come to the Apex court of Liberty land.

The questions to be decided by Apex Court in this case are:

1. Whether or not Dikchya Pvt. Ltd it is an independent person with its rights and liabilities

appropriate to itself?

2. Whether or not company was a myth, reasoned that Dikchya had incorporated the company

contrary to the true intent of the Contract Act?

In liberty Land, two law firms are popular and most of the clients come to these two law firm

with their commercial dispute. They are A-One Law Firm and another is Front line law firm.

Applicant of the both case came to the A-one Law Firm and defendant came to the Front line law

firm. Both of the law firms assign two advocates to present the case and one is to help the

advocates in research.

The Apex Court has fixed the date of hearing for December 1 2017. The Court will hear the case

subsequently. The Applicant in this case will be known as A-one law firm and defendant will be

known as Front line law firm. In the written memorial of the both respondent and defendant

these names shall be used as respondent and defender. However Teams must get them registered

by 1 November 2017 and registered teams must submit their written memorials both in hard and

soft copy by 17 November 2017.

Note: The legal system of liberty land is influenced by the legal system of England

Nepal and India. The Apex Court of Liberty Land has the trend to take the law of these three

countries as guiding principles while deciding the commercial cases. However, for criminal

cases, liberty land always takes the law of France as a guiding principle.