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  • MRL2601 Assignment 2 PDF

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    Nomxo Nyoni
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    This document is a summary of questions and responses for a company law assignment with a due date of September 30, 2020. It addresses whether providing financial assistance to purchase shares would constitute financial assistance under the Companies Act of 2008 and if a director selling an asset to the company at a profit would breach fiduciary duties. The response indicates that the transaction could be validated if the company meets financial requirements and the assistance is provided fairly, and that selling an asset to the company at a profit for personal gain would breach the director's fiduciary duties by benefiting himself without disclosure.

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    This document is a summary of questions and responses for a company law assignment with a due date of September 30, 2020. It addresses whether providing financial assistance to purchase shares would constitute financial assistance under the Companies Act of 2008 and if a director selling an asset to the company at a profit would breach fiduciary duties. The response indicates that the transaction could be validated if the company meets financial requirements and the assistance is provided fairly, and that selling an asset to the company at a profit for personal gain would breach the director's fiduciary duties by benefiting himself without disclosure.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    57 views2 pages

    MRL2601 Assignment 2 PDF

    Uploaded by

    Nomxo Nyoni
    This document is a summary of questions and responses for a company law assignment with a due date of September 30, 2020. It addresses whether providing financial assistance to purchase shares would constitute financial assistance under the Companies Act of 2008 and if a director selling an asset to the company at a profit would breach fiduciary duties. The response indicates that the transaction could be validated if the company meets financial requirements and the assistance is provided fairly, and that selling an asset to the company at a profit for personal gain would breach the director's fiduciary duties by benefiting himself without disclosure.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 2

    MRL2601

    Unique no.: 758364

    Due date: 30 September 2020

    N Nyoni
    60454911
    Question 1

    Yes, this amounts to financial assistance as explained in the Companies Act 71 of


    2008. This is because the company is not a money lending company. For this
    transaction to be validated, the company must have assets that are equal to or
    above the liabilities of the company and that it will be able to cover its debts for a
    year after the date of the transaction. The company should also grant the assistance
    under fair and reasonable terms.

    Question 2

    Yes, this is a breach in his fiducial duties as a director. He had performed


    transactions for his own benefit. He sold the company an asset with the aim to make
    a profit that will benefit him as an individual. He also did not disclose his position with
    the other arty that they are making a partnership with.

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