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MRL2601 EXAM PACK 2023
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MRL2601EXAM
PACK
2023
ELABORATE QUESTIONS &
ANSWERS
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CONFIDENTIAL
Page 7 of 10
MRL2601
May/June 2022
QUESTION 1
1.1 Name the different types of companies provided for in the Companies Act 71 of
2008. (5)
1.2 Describe the procedure for amending the Memorandum of Incorporation of a
company. (5)
1.3 Explain whether it is possible to pass a shareholders’ resolution without holding
a face-to-face meeting where the decision is one that should be taken at an
annual general meeting. Refer to relevant case law in your answer. (10)
1.4 Read the following statement and explain whether or not it is correct:
“In terms of the Companies Act 71 of 2008 companies have all the legal capacity
and powers of a natural person and such capacity cannot be restricted in order
to render any contract concluded by the company invalid”. (5)
1.5 Discuss the circumstances under which a company may declare dividends and
the procedure that must be followed to do so.
(5)
1.6 Dylane is a newly appointed director of Rentsure Ltd. He is not familiar with the
workings of a company. Briefly explain the differences between a shareholder
and a debenture holder to Dylane. (5)
TOTAL QUESTION 1: 35 marks
QUESTION 2
2.1 John and Rina want to incorporate a catering company by the name of Delish
(Pty) Ltd, together. Before the company is registered, John sees a delivery
vehicle that would be perfect for use in their catering business. List (do not
discuss) the different methods that can be used to conclude a contract that would
bind Delish (Pty) Ltd once it is eventually registered. (5)
2.2 Abednego, who had been a manager of The Joint CC before termination of his
employment, approached the Commission for Conciliation, Mediation and
Arbitration (the CCMA) seeking severance pay after he was retrenched. The
trade union that Abednego belongs to cited The Joint CC as the respondent in
a referral to the CCMA. The sole member of The Joint CC, Bongani Khumalo,
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CONFIDENTIAL
Page 8 of 10
MRL2601
May/June 2022
during conciliation indicated that The Joint CC was insolvent, and that
Abednego had been dismissed for operational reasons. The commissioner
advised Abednego to refer an unfair dismissal dispute. After hearing the matter,
the commissioner ordered The Joint CC to pay Abednego an amount of R250
000 for his unfair dismissal. However, it was discovered that The Joint CC had
no assets. It was also revealed that Bongani Khumalo had provided financial
assistance to The Joint CC and he had secured claims against the close
corporation for repayment of the loan amounts the payment of which would
render the close corporation completely insolvent.
Abednego intends to apply for an order from the Labour Court declaring that
Bongani Khumalo was his true employer and that he (Bongani Khumalo) and
not The Joint CC must pay him (Abednego) the amount of R250 000. With
reference to relevant case law, indicate what stipulation and/ or common law
principle applied in company law Abednego must rely on in order to hold
Bongani Khumalo liable instead of the close corporation. (6)
2.3 Briefly set out the information that must be contained in a notice convening a
meeting of a private company in terms of the Companies Act 71of 2008. (6)
2.4 Timothy is a director of Fedosa Ltd. A meeting is held where a decision has to
be taken regarding the provision of financial assistance to one of Timothy’s
close friends, Linda. Timothy, knowing that the transaction would render
Fedosa Ltd unable to pay its debts as they become payable in the ordinary
course of business for the next twelve months, attends the meeting, participates
in the vote and allows the decision to be passed in favour of providing financial
assistance to Linda.
With reference to the above-mentioned facts, explain the procedure that may be
followed against Timothy in terms of section 162 of the Companies Act 71 of
2008. In your answer, you must discuss the following:
2.4.1 Who can bring such an application. (6)
2.4.2 The specific grounds upon which such an application can be brought against
Timothy. (3)
[9]
2.5 The main object of Mnandi (Pty) Ltd is manufacturing food products. The
Memorandum of Incorporation of Mnandi (Pty) Ltd provides that the board of
directors may appoint a managing director who will be authorised to enter into
contracts on behalf of the company. However, should the amount of the
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CONFIDENTIAL
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MRL2601
May/June 2022
contract exceed the amount of R200 000, prior consent of the shareholders is
required.
Godfried, one of Mnandi (Pty) Ltd’s directors, buys a racing horse for R2,5
million from Fast Freddy on behalf of Mnandi (Pty) Ltd. Godfried had contracted
with Fast Freddy on behalf of Mnandi (Pty) Ltd before. What would Fast Freddy
have to prove if Mnandi (Pty) Ltd denies being bound by the contract on the
basis that Godfried lacked express authority to conclude the contract? Refer to
relevant case law in your answer. (7)
TOTAL QUESTION 2: 33 marks
QUESTION 3
3.1 Three friends, Sello, Tokelo and Bonang want to start a business together. Sello
believes that a close corporation is exactly the same as a company. Advise
Sello of the distinguishing features of a close corporation. (5)
3.2 Indicate which of the following persons are eligible to become members of a
close corporation. In each case also indicate whether any additional
requirements must be met to enable such persons to become members and if
so, what they these requirements are.
e.g. Question: a married man
Answer: Yes. No additional requirements.
3.2.1 A woman married in community of property (1)
3.2.2 An insolvent person (1)
3.2.3 A trustee of a testamentary trust in his or her capacity as such (1)
3.2.4 A minor; and (1)
3.2.5 A company (1)
[5]
3.3 Phineas, Mariah and Precious are the members of Cadenza CC. Precious has
a gambling problem. Her car has recently been repossessed by Payless Bank
Ltd as a result of her failure to settle her debts. Precious informs Phineas and
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