FINAL EXAM

Subject : Legal, Ethical and Social Environment of Business (INS2022)

Student name: Lý Thị Hương
Student ID : 18071114
Date of birth : 21/05/2000
Class : IB2018B

Question 1
My answer will follow the IRAC pattern.
Issues: Lorries that have appeared have the actual load capacity of 300 tons, not 360
tons as mentioned by Grand Car to Transtars. As a result, Transtars couldn't finish it's
shipping contract in time.
Rules: Here the Misrepresentation Act 1967 plays an important role. This one can be
amended as the common law principles related to misrepresentation.
Analysis: Here Grand Cars's statement was a fraudulent misrepresentation as the
company was very much aware of the actual load capacity of it's lorries. Yet, they had
hidden the information & took the contract. Even they argued when they were sued by
Transtars. So it is a clear case of fraudulent misrepresentation.
Conclusion: In conclusion, it can be said that Grand Cars' statement was a fraudulent
misrepresentation which was done purposefully.
The outcome of the case would be that Transtars will win the case. They will earn a
damage charge from the Grand Cars. The Misrepresentation Act 1967 will declare that
it all happened because of the purposeful fraudulent misrepresentation that happened
from Grand Cars' end.Grand Cars argues that it got information about a load of the
lorry as per an expert report published in a professional journal in the transportation
field; the beginning specialized detail of the lorry kept by Grand Cars gives that its
genuine load limit is 300 tons. But the Transtar representative told them the load
capacity is 360 ton and not to complete their work on time

Question 2
The best alternative available is to repudiate the contract and claim damages. Because
she might not feed her guests if she permits their repeat performance, she may give the
food to those in need, such as beggars or destitute children on the streets, as a kind
gesture upon her birthday. Consequently, she has no choice but to file a claim for
compensation.Rational
The food service delivery was critical and could not be postponed since the party had
ended, and Selena had to go to another city.
a. Permitting the repeat performance isn't going to benefit her since she doesn't have a
party scheduled and won't be able to invite her guests back. Moving to a new city is a
lot of effort, and she can only allow the order to be repeated if she organizes another
party at her new location.
b. For the time being, the best option is to sue the catering service for damages. This
is because she would be able to recoup at least the amount she had spent in the
contract if she did so.

Question 3
According to the laws of negligence it is said that the concerned authority must be
responsible for providing proper service and they must ensure safety and security. In
the present case the park authority fails to provide proper service to the children. They
do not maintain the rides and now the children are suffering for their lack of interest
and care in the maintenance of the rides. Without maintenance they allow children to
enjoy the rides and push the children to danger. Naturally they are liable for such
accidents and the accident happened because of their negligence.

So in the present case the park authority is liable to provide compensation and the
victims have sufficient issues against the park authority and the judgment must be in
favor of the victims. The park authority must be more careful where the issue of
children is related.

Question 4
Generally shareholders do not have rights to be involved in the day to day activities of
the company (unless otherwise agreed in a shareholders agreement) this is the
responsibility of the directors. In small to medium size companies where the
shareholders and directors are the same people, there may be overlap between the
roles but it is important to distinguish shareholder rights from director rights and
duties.
Shareholders who hold a higher percentage of the shares in the company have even
more power to take other types of action. Shareholders with over 25% of the shares
will be able to block special resolutions (e.g. change of articles, change of name) and
those with more than 50% will be able to block ordinary resolutions (e.g. winding up
the company, removing a director from office).

Common shareholder main rights:

1. Voting power on major issues. Voting power includes electing directors and
proposals for fundamental changes affecting the company such as mergers or
liquidation. Voting takes place at the company’s annual meeting. If the
shareholder cannot attend, they can do so by proxy and mail in their vote.1
2. Ownership in a portion of the company. Previously, we discussed a corporate
liquidation where bondholders and preferred shareholders are paid first.
However, when business thrives, common shareholders own a piece of
something that has value. Common shareholders have a claim on a portion of
the assets owned by the company. As these assets generate profits and as the
profits are reinvested in additional assets, shareholders see a return as the value
of their shares increases as stock prices rise.
3. The right to transfer ownership. The right to transfer ownership means
shareholders are allowed to trade their stock on an exchange. The right to
transfer ownership might seem mundane, but the liquidity provided by stock
exchanges is important. Liquidity—the degree to which an asset or security can
be quickly bought or sold in the market without affecting the asset’s price—is
one of the key factors that differentiates stocks from an investment such as real
estate. If an investor owns the property, it can take months to convert that
investment into cash. Because stocks are so liquid, investors can move their
money into other places almost instantaneously
4. Entitlement to dividends. Along with a claim on assets, investors also receive a
claim to any profits the company pays out in the form of a dividend.
 Management of a company essentially has two options with profits: they can be
reinvested back into the firm (thus, one hopes, increasing the company’s
overall value) or paid out in the form of a dividend. Investors do not have a say
as to what percentage of profits should be paid out—the board of directors
decides this. However, whenever dividends are declared, common shareholders
are entitled to receive their share
5. Opportunity to inspect corporate books and records. Shareholders have the
right to examine basic documents such as company bylaws and minutes of
board meetings. In addition, the Securities and Exchange Act of 1934 requires
public companies to periodically disclose financials Most companies produce
two versions of their annual report. The 10-K version must follow the filing
requirements set by the Securities and Exchange Commission (SEC)
6. The right to sue for wrongful acts. Suing a company typically takes the form of
a shareholder class-action lawsuit.
In accordance with the provisions of the Articles of Association, the General Meeting
of Shareholders is authorized to pass all kinds of resolutions concerning the Company,
the following powers being namely reserved thereto, without prejudice to any other
powers vested by the applicable regulations:
1. To resolve on the individual annual accounts of the Company and, where
appropriate, on the consolidated accounts of the Company and its Group, as well as on
the distribution of the income or loss.
2. To appoint, re-elect and remove directors, and to ratify or revoke any provisional
appointment of said directors made by the Board of Directors itself, and to review
their management.
3. To approve the adoption of remuneration systems consisting of the granting either
of shares or stock options, as well as any other remuneration system linked to the
value of the shares, for the benefit of directors.
4. To approve the Directors’ remuneration policy pursuant to statutory terms.
5. To conduct, as a separate item of the agenda, an advisory say-on-pay vote on the
Annual Report on the Remuneration of Directors.
6. To authorize the release of the directors from the duty of preventing conflicts of
interest and of the prohibitions arising from the duty of loyalty, when the authorization
to release them is attributed by statute to the General Meeting of Shareholders, as well
as from the obligation not to compete with the Company.
7. To authorize the Board of Directors to increase the Company’s share capital, or
to proceed to the issue of bonds convertible into Company’s shares.
8. To resolve the issue of bonds convertible into Company’s shares or which allow
bondholders to participate in the company’s earnings, the increase or the
reduction of the share capital, the exclusion or restriction of the pre-emptive right,
the transformation, merger, split-off or winding-up of the Company, the global
assignment of assets and liabilities, the approval of the final balance sheet of
liquidation, the transfer of the registered office abroad, as well as any other
amendment whatsoever of the Articles of Association.
9. To authorize Company’s shares buyback; to approve such transactions which
entail a structural amendment in the Company, and namely: (i) the
transformation of listed companies into holding companies, through
“subsidiarisation” or the assignment to dependent entities of core activities
theretofore carried out by the Company, even though the Company retains full
control of such entities; (ii) the acquisition, disposal or contribution to another
company of essential assets; and, (iii) such transactions which entail an effective
amendment of the corporate objects and those having an effect equivalent to the
liquidation of the Company.
10. To appoint, re-elect and remove the financial auditors.
11. To appoint and remove, where appropriate, the Company’s liquidators
12. To approve these Regulations and any subsequent amendment thereof.
13.To resolve on the matters submitted to it by a resolution of the Board of
Directors.
14. To give directions to the Board of Director or to submit to its prior authorization
the passing by the Board of Directors of decisions or resolutions on certain
management matters; and
15. To grant to the Board of Directors such powers it may deem fit to deal with
unforeseen issues