Legal Aspects of Business PDF

Legal Aspects of Business

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Unlimited Partnership.................................................................................................................1
Private Limited Company...........................................................................................................3
TASK 2............................................................................................................................................5
Duty to act within powers (Section 171 Companies Act 2006)..................................................5
Duty to promote the success of the company (Section 172 Companies Act 2006)....................5
Duty to exercise independent judgement (Section 173 Companies Act 2006)...........................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Legal aspects are important for a business in order to follow all the rules and regulations
formulated by government which helps to reduce influences of laws which affect business as
well as its success. The report will cover unlimited liability and and private limited business by
referring to relevant case law and legislation associated with main features effectively. In
addition to this, the report will also demonstrate understanding and importance of director role in
business with relevant case law and legislation associated with duties and roles. The Company
Act 2006 with section 171, 172 and 173 will be discussed in this report.
TASK 1
Unlimited Partnership
An unlimited partnership is a firm where two or more than two persons involved and
participate in business operational activities or in management of its assets in order to make
business successful. The partners are liable for its debts and profits as well. There are some
advantages of an unlimited partnership such as simple registration, no minimum capital required
and also the simple structure of business (Štofová and Szaryszová, 2017). Unlimited liability
business includes joint owners that are equally responsible for managing business profitability
and losses effectively. The unlimited liability typically exists in general partnership and sole
proprietorship. This will indicate that debt accrues when a firm is unable to pay its repay or
defaults in their debts effectively. They are responsible for personal growth and development to
cover the owed balance. This is the reason, most of the businesses choose to form as a limited
partnership instead of taking risks in personal assets through unlimited liabilities.
For an example, there are four individuals working in a business as partners and each one
of them invested $35,000 jointly. In a one year period business accrues a total $225,000 in
liabilities. In case if the business is unable to pay or repay its debts or defaults on debts, all four
partners are responsible for repayment of debts. Therefore, initial investment made by all the
partners of $35,000 required to come up with $56250 in order to repay debts payment
effectively.
Partnership Act 1890: The partnership act 1890 is known as traditional partnership and rules are
also specified such as all the partners must be active in business and involved in performance
activities through management (Sykes, 2016). Minimum two partners are required and maximum
are allowed to unlimited. Profit and losses are divided into partners equally and also liable for
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bearing losses such as loss from fire or danger. Liabilities will be paid by partners equally and
effectively. A joint partnership account is needed and should be written in a agreement top
conduct real partners involved in activities.
Termination of Partnership Under 1890 Act: There are some situations, where the partnership
is broken in business such as if all the partners are mutually agreed to end up business, order
from court, if the duration of partnership business expires and death of any partner effectively.
Partnership Act 1907: According to this act, two or more than two partners are involved in a
business for the purpose of making profits and also liable for paying debts and bearing losses
equally in order to extent their investments is known as limited partnership effectively
(Burnham, 2016).
Rebecca Steinfield and Charles Keidan
These two persons take their case to supreme court in order to secure legal recognition as
same sex civil partners without getting married. Earlier this year, the issue of extended rights for
unmarried couples was debated in the House of Commons and passed to the next stage through
Parliament. During that debate, the government was allowed to amend the bill to review the
operation of civil partnerships. Further evidence about the demand and need for civil
partnerships is likely to be available by July 2018 (Bagley, 2015). in addition to this The Civil
Partnership Act 2004 is amended to extend civil partnership to all effectively and efficiently.
Hurst v. Bryk
The lessees' right as trustee to be indemnified by their beneficiaries for liabilities
undertaken by them in the course of their trust establishes the business liabilities but says nothing
about Mr. Hurst's obligations to his fellow partner to contribute toward its discharge. Partners are
jointly and not severally liable for the debts of the firm incurred while they were partners
(section 9 of the Act), and they are beneficially entitled to the assets of the firm remaining after
the liabilities have been discharged effectively and efficiently.
It can be said that there are different types of partnership involved in unlimited
partnership business such as the conventional partners. The partnership is defined under
Partnership Act 1890 effectively (Mikaelyan, Mikaelyan and Filippov, 2016). There are some
main features of conventional partnership such as the partners are liable for its debts and profits
as well as Unlimited liability business includes joint owners that are equally responsible for
managing business profitability and losses effectively. All the partners are taxed on their profits
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