Hello! These notes are a complete review of the SQE1 course from the University of Law. They contain everything you need to know to pass. I successfully completed both SQE1 and SQE2 both times and I attribute it to these notes which were incredibly effective when reviewing prior to the exams. The p...
Ethics and Professional Conduct
SRA Principles
o Arrangement with third parties
Referral fees are prohibited in situations relating to damages of death or
personal injury
Clients must be informed of any fee-sharing arrangement that is relevant to a
matter
Clients can only be referred to a separate business unless given informed
consent must be informed of any interests in the referral and cannot receive
a referral fee without giving to client
o Complaints handling
Solicitors must ensure that clients are informed in writing at the time of
engagement about:
Their right to complain about the solicitor’s services and charges
How complaints may be made and to whom
Any right they have to complain to the Legal Ombudsman and when
o Conflicts of interest
Two formal exceptions: 1) where the clients have a substantially common
interest or 2) where clients are competing for the same objective (likely only
corporate clients)
Where the only conflict between the parties is their wider business
interests then this will not create any conflict-of-interest issues.
Conditions for acting: 1) all the clients have given informed consent,
given or evidenced in writing, to the solicitor acting, 2) where
appropriate, effective safeguards are put in place to protect the clients’
confidential information, 3) and the solicitor is satisfied it is reasonable
to act for all the clients
Only between current clients, not former clients whose file is closed
o Confidentiality
Must not disclose information without client’s consent
Unless
Where a client has indicated their intention to commit suicide or serious
harm
Preventing harm to children or vulnerable adults
Preventing the commission of a criminal offence
The solicitor has a duty of confidentiality towards previous clients and so must
not disclose any information about previous clients to new clients dealing with
them. The solicitor’s duty towards new clients are to “make the client aware of
all information material to the matter of which you have knowledge”, but there
is an exception where “your client gives informed consent, given or evidenced in
writing, to the information not being disclosed to them”.
,FLK 1: Business Law, Contract Law, Dispute
Resolution, Tort Law, Legal Services, Legal
Systems, Constitutional Law
Business Law
Vehicles of a Company
Business mediums
o Sole traders or sole proprietors
Single person owns and runs a business as a self-employed person, in their own
personal capacity with unlimited liability
No procedures and documentation required to start
o General partnerships
At least two people carrying on business in common, with unlimited liability
Regulated under the Partnership Act 1890, but most customize via their own
partnership agreement
No procedure and documentation required to start, just two people acting as
partners with the view to profit
o LLPs
Taxed as a general partnership, but are considered a separate legal entity and
benefit from limited liability
If at any time the members of an LLP reduces to one for more than 6
months, that partner is jointly and severally liable for any of the LLP’s
debts in the 6 month period
To commence operating:
File form LL IN01 and the applicable fee with Companies House
Choose a name
Have a registered address - this will be publicly available
Have an LLP agreement that says how the LLP will be run
Register the LLP with Companies House
Individual members of the LLP must register with HMRC as self-
employed
o Private companies
Separate legal personality and limited liability (a shareholder’s liability is limited
to the amount already invested)
Companies Act 2006
Owners (shareholders) are separate from managers (directors)
o Public companies
Can sell shares to the public
Forming a company
o Companies House
Form IN01 submitted to Companies House, along with memorandum of
association (or articles, if not using the Model Articles)
Will contain: first directors and addresses, first shareholders and
addresses
, IN01 must state the number of shares the company has and the total
nominal value
Will also include prescribed particulars: dividends, redemption potential
of shares for money, whether they can vote on certain matters, how
many votes their shares entitle them to
Companies House will issue a certificate of incorporation stating:
The name and registered number of the company name cannot
contain swear words, must be Plc or Ltd, cannot suggest government
affiliation
The date of its incorporation
Whether it is a limited or unlimited company and, if it is limited,
whether it is limited by shares or by guarantee
Whether it is a private or public company
The company’s registered office must be where business is
conducted
Must register with HMRC for corporation tax
To switch from private to public company: pass a special resolution, register
with Form RR01, alter name to Plc
o Company constitution: memorandum of association, Articles of Association, certificate
of incorporation, current statement of capital, shareholders’ resolutions, court orders
and legislation which affect the company’s constitution.
Articles of Association: rulebook incl. notice period for board meetings,
minimum number of directors required in order for board meeting to be valid,
whether the board of directors can refuse to register a new shareholder and the
circumstances in which a director will not be allowed to vote
Model Articles: will be for companies incorporated after October 1, 2009
Forming a partnership
o Partnership Act 1890
Assumes equality of capital contribution, sharing of profits and losses, equality
of property between partners
All assumptions can be rebutted through implied conduct which is
consistent profit sharing, hours of work every week (as the PA does
not require a set number of work hours)
Duty of good faith/implied non-compete: must share any profits they make if
they have a business that competes with the partnership
Expulsion: no right to expel a partner
Retirement: can be terminate by any one partner giving notice
Would not remove their liability for already incurred debts, but any
debts going forward are not liable if they:
o Give notice to existing customers and suppliers
o Put an announcement in the London Gazette
o Remove their name from the website/stationery
Former partners who do not have knowledge that they were being
represented as being a partner on the firm’s old notepaper after asking
, to be taken off will not be held liable for the debt to the supplier (s14
Partnership Act 1890)
Partners who have accounted to the partnership for their share of the
debts when leaving a partnership will not absolve themselves from
liability for debts – they can claim against the remaining partners to be
reimbursed
Dissolution under the PA:
When a partner retires
On expiry of a fixed term
By the death or bankruptcy of any of the partners
Notice of dissolution to a partner who has (by order of the court)
granted a charge over their share of the partnership property
If unlawful actions take place
Distribution of proceeds of sale
1) creditors of the firm must be paid in full. If there is a shortfall, the
partners must pay the balance from their private assets
2) partners who have lent money to the firm must be repaid the
amount outstanding on the loan, including interest.
3) partners must be paid the share of the partnership’s capital to which
they are entitled.
4) any surplus is shared between the partners in accordance with the
terms of their partnership agreement
Binding the partnership
Actual authority: did the person in question have permission to enter
into the contract on behalf of the partnership?
Apparent authority: the other party believes the person is a partner that
has the authority to act and normally it would be expected that they can
act
o Partnership agreements
Does not need to be written, can be implied through conduct
Non-competes are often added in, but not in the PA 1890
There is no automatic right to veto, but by customizing a partnership agreement
a right to veto can be added in
Roles: each partner’s roles and duties
Decision making is made by majority, except unanimously for:
Changing the nature of the business
Introducing a new partner
Changing the terms of the partnership agreement
Share in income and capital profits/losses
Ownership of assets
Dissolution: if it does not address this issue, the partner may insist on assets
being sold to buy him out or 5% annum interest on the value of their
partnership
Liability between partners: a partner when leaving is entitled to their share of
the assets, minus their share of the debts
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