TOLES Advanced – Section 6 (Index 6)
Choose which section (A), (B), or (C) contains the error.
1. A limited company is a separate legal entity which can enter into contracts and sue or be sued in its own name.
2. Shareholders of a limited company are generally not personally liable for the debts of the company beyond their share capital.
3. The directors owes fiduciary duties to the company and must act in what they consider to be its best interests.
4. A company may only distribute dividends where it has sufficient profits available for distribution under applicable law.
5. The Articles of Association sets out the internal rules governing the management of the company.
6. A shareholder agreement may regulate matters which are not expressly dealt with in the Articles.
7. A private limited company is not prohibited from offering its shares to the public.
8. The company secretary, if appointed, are responsible for ensuring compliance with certain statutory filing requirements.
9. Upon incorporation, a limited company acquires rights and obligations which are distinct from those of its members.
10. If a company continues to trade while insolvent, the directors may incur personal liability for wrongful trading.
TOLES Advanced – Section 7 (Disputes and Litigation) (Index 7)
Read the extract from a contract and choose the correct fragment to complete (1) to (10).
FROM A DISPUTE RESOLUTION AGREEMENT
30. Disputes
30.1 Any dispute arising out of or in connection with this Agreement, including any question regarding its existence, validity or termination, shall be referred to and finally (1) by arbitration.
30.2 The arbitration shall be conducted in accordance with the rules of the London Court of International Arbitration, which rules are deemed to be (2) by reference into this Clause.
30.3 Nothing in this Agreement shall prevent either Party from seeking interim or injunctive relief where such relief is necessary to prevent (3) harm.
30.4 The Parties agree that damages alone may not constitute an adequate remedy and that a court may grant equitable relief (4) proof of actual loss.
31. Litigation
31.1 Each Party shall bear its own legal costs, unless the tribunal determines that such costs should be awarded on an (5) basis.
31.2 No Party shall commence proceedings unless it has first complied with the pre-action requirements and made a bona fide attempt to (6) the dispute amicably.
31.3 Any settlement reached shall be without prejudice to the Parties’ respective rights and shall not constitute an admission of liability (7).
31.4 The tribunal’s award shall be final and binding upon the Parties and may be enforced (8) any court of competent jurisdiction.
31.5 Nothing in this Clause shall limit the right of either Party to commence proceedings where required (9) statute.
31.6 The Parties agree that time shall be of the (10) in relation to any procedural steps required under this Clause.
Total Questions: 10
Incorrect Answers: 0
TOLES Advanced – Section 8 (Index 8)
Read the extract from a partnership deed below. Using the definitions provided, find the underlined word or phrase in the contract that matches each definition.
FROM A PARTNERSHIP DEED (TRADITIONAL PARTNERSHIPS & LLPs)
Each person admitted as a Partner shall be bound by the terms of this Deed. The Partnership shall carry on business under the name set out in Schedule 1. The Partners acknowledge that the Partnership is not a separate legal person and that the Partners shall be jointly and severally liable for all debts and obligations of the Partnership incurred in the course of the business. The Partners shall act in good faith and shall not, without prior written consent, engage in any conflict of interest with the business. Any Partner wishing to cease to be a Partner shall give written notice in accordance with clause 12, whereupon the Partner shall be treated as having retired from the Partnership. If the remaining Partners elect to bring the business to an end, they may resolve that the Partnership be dissolved with effect from the dissolution date. A Limited Liability Partnership may alternatively be formed, in which case the members’ liability shall be limited to the amount they have agreed to contribute as capital, and the business shall be carried on through an entity registered at Companies House as an LLP.
1. “a person who is admitted to share in the profits and management of a partnership business”
2. “the business relationship between persons carrying on a venture in common with a view to profit”
3. “liable together as a group and also individually, so that each person may be pursued for the whole amount”
4. “an obligation to act honestly, fairly, and loyally towards the other partners”
5. “a situation where a partner’s personal interests may interfere with duties owed to the partnership”
6. “to cease to be a partner by leaving the partnership (typically by giving notice)”
7. “to terminate the partnership by bringing the business relationship to an end”
8. “money or property contributed by partners/members to fund the business”
9. “a business vehicle in which members typically have limited liability and the entity is registered at Companies House”
10. “a standard of conduct requiring honesty, fair dealing, and cooperation between partners”
Total Questions: 10
Incorrect Answers: 0