THE CATHOLIC UNIVERSITY OF EASTERN AFRICA

A. M. E. C. E. A P.O. Box 62157

00200 Nairobi - KENYA

MAIN EXAMINATION Telephone: 891601-6

Ext 1022/23/25
JANUARY – APRIL 2022
Fax: 254-20-891084
FACULTY OF LAW

REGULAR PROGRAMME

DCLS 066 - ELEMENTS OF THE LAW OF BUSINESS ASSOCIATIONS

Date: APRIL 2022 Duration: 2 Hours
INSTRUCTIONS: Answer Question ONE and any Other TWO Questions

Q1. Peter and John were partners in a firm known as P&J Advocates LLP established
in 2021. There were 3 other partners and associates at the firm by 2021. At the end of
December 2021, Peter indicated that he wanted to leave P&J Advocates LLP to
establish another firm and another partner opted to join Peter in establishing the firm.
Peter and his new partner also discussed their intentions with the other associates at
the firm and invited them to join.

Using case law:

1. What documents were used to establish P&J Advocates LLP? (5 marks)

2. Discuss the procedure to be followed for Peter and the other partner to leave
P&J Advocates LLP. (10 marks)
3. What are the potential challenges to P&J Advocates LLP with Peter and the other
partner leaving to establish a new firm? (10 marks)
4. Was there any issue with Peter and partner inviting the other associates to join
the new firm? (5 marks)

Q2. Anne and Maria met at CUEA while undertaking the diploma in law program and
immediately became friends. Upon realizing that they wanted to use their studies to
become entrepreneurs, they began to work together to sell clothes and other items to

CUEA/ACAD/EXAMINATIONS/DIRECTORATE OF EXAMINATIONS & TIMETABLING Page 1

ISO 9001:2015 Certified by the Kenya Bureau of Standards

their fellow students. Upon graduation, they opened a stall near the campus and
expanded to offer other services such as photocopying and printing.

Maria feels that she is more invested in the success of their business and is doing all
the work. Anne feels that they are expanding the business to include services she’s not
interested in doing.

They both come to you for advice. Cite relevant case law where necessary.

1. What nature of business have both Anne and Maria being carrying on?(5 marks)
2. Based on your answer, how can they dissolve their business? (10 marks)
3. Maria wants to continue with the business on her own. How can she do that?

(5marks)

Q3. Using case law, elaborate the distinction between a limited partnership and a
limited liability partnership. (10 marks)

Why was the Limited Liabilities Partnership Act established? Discuss this in light of the
changes that were made to the Companies Act. (10 marks)

Q4. Section 61(5) of the Co-operative Societies Act 1997 states that “A cooperative
society shall not be dissolved or wound up save by the order of the commissioner.”

Discuss the implications of dissolution of a co-operative. (20 marks)

Q5. Using examples of different types of co-operatives, discuss the history and
development of the co-operative movement in Kenya from colonization to the present.
Clearly contextualize and discuss principles and factors considered in the evolution of
the co-operative’s movement. (20 marks)

*END*

CUEA/ACAD/EXAMINATIONS/DIRECTORATE OF EXAMINATIONS & TIMETABLING Page 2

ISO 9001:2015 Certified by the Kenya Bureau of Standards