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Documente Cultură
Corporate Secretaryship
Date:
22 May 2009
Time:
9h00 12h00
Duration:
3 hours
Marks:
100
Memorandum
Page 1 of 10
QUESTION 1
The candidate must recognize that the issue at hand is not who the shareholder is, but who
may sign documents on behalf of a shareholder-principal or incoming shareholder-principal.
Form CM42 and many Articles require signatures of both. This is a practical application of
Corporate Law principles as they apply to transfer secretaries.
Marks may be awarded for good explanations of the underlying principles. (Eg. The doctrine
of imputed knowledge regarding companies = practical to require copies of public documents.
Eg. Turquand = the reason for copy of resolution.)
However, the marks awarded for each section may not exceed the allocated marks for that
section.
Marks should not be awarded for discussions regarding deceased estates, partnerships, trusts
and the like.
1. Company
- Authority from memorandum & Articles or resolution not power of attorney
- Copies of Articles & Memo, Certificate of Incorporation, Certificate to commence
business
- Representation clause (eg 2 directors must sign). If no number is mentioned, can
assume in order in terms of a resolution.
- Copy of Resolution
- Certified list of directors with specimen signatures
- If intra vires company, but ultra vires Board, require resolution from
General Meeting.
(6)
2. Company in liquidation
- Liquidators certificate of appointment from Master
- No objection to transfer of shares TO such company
(2)
(2)
4. Close Corporation
- Every member is agent and may sign
- However, Association Agreement may contain restrictions. Copy of
Association Agreement required.
(2)
CORPORATE SECRETARYSHIP
MEMORANDUM
MAY 2009
Page 2 of 10
(2)
[20 marks]
QUESTION 2
This question requires the candidate to be conversant with the requirements of the exception
and to exhibit practical minute drafting skills in circumstances where legislation prescribes
what factors need to be taken into account in the decision making process.
Bad phrasing of the resolutions did not count against a candidate. If the candidate grasped the
essence of the resolutions needed, marks were awarded.
CORPORATE SECRETARYSHIP
MEMORANDUM
MAY 2009
Page 3 of 10
(1)
IN ATTENDANCE:
Quorum:
Apologies:
Minutes:
Matters arising from
the minutes
Loans to BEE Group to
acquire shares
Mr A (Chairman)
Mr B
Mr C
Ms F (Company Secretary)
A quorum being present, the chairman declared the meeting
duly constituted
There were no apologies / Apologies were tabled for
The minutes of the Board Meeting held on . As circulated
were taken as read and signed as a correct record.
None
(1)
(11)
(1)
(1)
(1)
(1)
(1)
(1)
[20 marks]
CORPORATE SECRETARYSHIP
MEMORANDUM
MAY 2009
Page 4 of 10
QUESTION 3
This question required the candidate to exhibit good writing skills, knowledge of the law of
meetings and to apply that knowledge to the stated case. It is necessary to identify the relevant
matters (convening and notice) and not to expand on irrelevancies. However, it is not
necessary for the candidate to have studied the judgment.
Layout & presentation
(2)
Common Law
Relevant Statutes/Legislation(in casu Company Act, Broadcasting Act)
Regulations applicable to the particular body (in casu, the Articles)
(1)
Proper Convening
Duly constituted
3. Convening
-
(1)
(1)
4. Proper Notice
-
CORPORATE SECRETARYSHIP
MEMORANDUM
MAY 2009
Page 5 of 10
(1)
5. Application:
-
CORPORATE SECRETARYSHIP
MEMORANDUM
MAY 2009
Page 6 of 10
QUESTION 4
1. Letter format
2. Reasons:
-
(1)
Previously paper-based.
Inefficient in developed securities market
Now STRATE = CSD = Central Securities Depository
(3)
3. STRATE
-
Only CSD in SA
Settles all trades on JSE
Provides simultaneous final and irrevocable delivery & payment
Only from registered participants
(3)
4. Participants in STRATE
-
6. Advice to client:
-
(3)
[20 marks]
CORPORATE SECRETARYSHIP
MEMORANDUM
MAY 2009
Page 7 of 10
QUESTION 5
This is a simple question requiring the candidate to exhibit a detailed knowledge of the relevant
requirements. However, it also requires the candidate to recognise the report as a special report and to
draft the report in a suitable form.
The sub-headings below are but examples and the candidate may choose to make use of a different
format.
1. Suitable report format: Heading, full sentences, sub-headings etc.
(4)
(1)
3. Qualifications
-
4. Residency
-
Permanently resident in SA
(1)
Not be disqualified:
- minors,
- legal disability,
- disqualified by court,
- unrehabilitated insolvent (unless court authorises),
- removed from office of trust (unless court authorises),
- found guilty of theft etc.
secretary = officer of company, therefore also not prohibited by court order:
- When convicted of offence regarding promotion etc.
- In winding up Master has reported
- During winding-up or judicial management = reckless or fraud
Not be disqualified by Articles
King = to be subjected to fit & proper test as directors
(7)
7. Recommendations:
a. .....
b. .....
(2)
(2)
[20 marks]
QUESTION 6
CORPORATE SECRETARYSHIP
MEMORANDUM
MAY 2009
Page 8 of 10
This question requires the candidate to identify the matters that need to be attended to at the
first board meeting of a company and requires the candidate to recognise that some items need
to be left out. Furthermore, the ability to draft a comprehensive agenda is tested.
1.
2.
3.
4.
(3)
Election of Chairman
Table Memo, Articles & Certificate of Incorporation
Appointment of Directors
Payment for shares
(1)
(1)
(1)
- subscribers
- Directors qualification shares
(2)
5. Determination of quorum
6. Declaration of Directors Interest
-
(1)
(2)
7. Appointment of MD
8. Appointment of Public Officer
9. Tabling of addresses
10. Appointment of Auditors
11. Appointment of Company Secretary
12. Opening of Bank accounts
13. Ratification of pre-incorporation contracts
14. Allotment of shares
15. Signatories of certificates
16. Specimen share certificate
17. Display of name
18. Statutory books
19. Opening of financial books
(13)
[20 marks]
CORPORATE SECRETARYSHIP
MEMORANDUM
MAY 2009
Page 9 of 10
QUESTION 7
7.1
1. Advantage of CC = limited liability
2. However, the Act provides for personal liability when:
-
There was gross abuse of separate legal existence (Sec 65): Haygro case,
Airport Cold Storage case
(1)
(2)
(1)
(1)
(2)
(2)
(2)
(10)
7.2
1. All members entitled to participate
2. Consent of 75% needed for:
3.
4.
5.
6.
(1)
(4)
(1)
(1)
(1)
(2)
(10)
[20 marks]
END OF MEMORANDUM
CORPORATE SECRETARYSHIP
MEMORANDUM
MAY 2009
Page 10 of 10