Corporations

Reference received: 7 September 1971

Note: Work on this reference was regarded as complete when the subject matter of the reference was covered by the Uniform Companies Code

Terms of reference

To review the principles of the Law relating to-

(a) the formation of corporations under the Companies Act, 1961;

(b) corporations so formed; and

Without affecting the meaning of the above terms of reference, I request the Commission to consider in the course of the review the following matters relating to corporations under the Companies Act, 1961-

(a) The minimum number of members.

(b) The liability of members and officers to creditors and others having claims against the corporation.

(c) The liability of one of a group of corporations to creditors and others having claims against others of the group. "Group of Corporations" here means a number of corporations related by proprietorship or control, as for instance a holding company and its subsidiaries.

(d) The rights and liabilities arising where a member of a corporation is also an officer of the corporation.

(e) The interests of members of a corporation in the property of the corporation.

(f) The classification of corporations under section 14 (2) of the Companies Act, 1961.

(g) The distinction under the Companies Act, 1961, between-

(i) public companies and proprietary companies; and

(ii) exempt and other proprietary companies.

Again without affecting the meaning of the above terms of reference, I request that, except as to incidental matters, the Commission should not deal with any subject under the consideration of the Company Law Advisory Committee pursuant to its terms of reference "to enquire into and report on the extent of the protection afforded to the investing public by the existing provisions of the uniform Companies Act and to recommend what additional provisions (if any) are reasonably necessary to increase that protection".