LML4806 Semester 1 Assignment 01 - 2023

Company Law

LML4806

Semester 1 Assignment 01 - 2023

Mercantile Law Department

 CONTENTS

Page

1 GENERAL INSTRUCTIONS .......................................................................................................... 3

2 ASSIGNMENT 01 ........................................................................................................................... 3
Question: 1 ................................................................................................................................................. 3
Question: 2 ................................................................................................................................................. 3

2
 1 GENERAL INSTRUCTIONS
• Assignments test your understanding of the learning material and your ability to apply what
you have learnt. Two written assignments are set for this module i.e., Assignment 01
and Assignment 02. Answering these questions gives you practice in answering the type
of questions that you may expect in the examination.
• The marks you obtain for Assignment 01 and Assignment 02 make up your year mark.
• You should answer all questions under each assignment. Your answer to each assignment
should generally not exceed two and a half pages if it is typed (excluding the bibliography).
• You may reference your sources as you wish (e.g., in-text or in the footnotes) but it is
preferable that you reference your sources within the text of your answers. It is not
mandatory to include a bibliography. You may include a bibliography at the end of your
assignment voluntarily. However, you should remember to include your Honesty
Declaration Form.
• Refer to Paragraph 9 of your Tutorial Letter 101 for the general information about
assessment.
• Also refer to Paragraph 10 of your Tutorial Letter 101 for important information regarding
academic dishonesty (plagiarism and cheating).

2 ASSIGNMENT 01
Question: 1

Musa, Amos, Sipho and Jimmy are directors of Khubo Limited. Jimmy was appointed as an
executive director of Khubo Limited three years ago under a five-year contract of employment
with the company. Musa has expressed his concerns to the board of directors that for the past
two financial years Jimmy has been failing to ensure the timely preparation and submission of the
company’s annual financial statements, and that Jimmy omitted to sign the annual financial
statements for the previous financial year as the authorised director, as required. Musa has also
informed the board of directors that, after joining Khubo Limited, Jimmy was removed as
chairperson of the board of trustees of the JF Pension Fund after he forged some documents and
withdrew R2 million from the JF Pension Fund’s bank account for his personal use. Advise Jimmy
on the following:

1.1 Whether under the circumstances of this case the board of directors of Khubo Limited will
have valid grounds to remove him (Jimmy) as a director of the company. (6)

1.2 The procedure that the board of directors must follow and the rights that Jimmy has in
terms of the Companies Act 71 of 2008 should the board of directors decide to remove him
as a director. (8)

Question: 2
TN Engineering Group Ltd (“the company”), a newly incorporated company does not have a
company secretary. The company has been approached by RLV Corporate Services (Pty) Ltd
which has offered to provide it with company secretarial services. In its Memorandum of
Incorporation, RLV Corporate Services (Pty) Ltd describes itself as a South African business that
provides customised compliance, governance and company secretarial services to the South
African corporate community.

3
With reference to the Companies Act 71 of 2008, discuss whether RLV Corporate Services (Pty)
Ltd can validly be appointed as the company secretary of TN Engineering Group Ltd. (6)

TOTAL FOR ASSIGNMENT 01: [20]

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