Business Law Flashcards
7 cards from real ACA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Business Law flashcards as text
Under the Companies Act 2006, what is the minimum number of directors required for a private limited company?
Answer: One
The Companies Act 2006 requires a private limited company to have at least one director.
Which of the following best describes the doctrine of separate legal personality established in Salomon v Salomon & Co Ltd [1897]?
Answer: A company is a legal entity distinct from its shareholders
Salomon v Salomon established that a company is a separate legal entity from its members, meaning it can own property, incur debts, and be sued independently.
In English contract law, which element is NOT required for a valid contract to exist?
Answer: Written documentation
Most contracts in English law can be formed orally or by conduct; written documentation is generally not required unless statute demands it.
Under the Insolvency Act 1986, what is the minimum unpaid debt required for a creditor to present a winding-up petition against a company?
Answer: £750
A creditor must be owed at least £750 (the statutory minimum) to present a winding-up petition under the Insolvency Act 1986.
A director's duty to avoid conflicts of interest under the Companies Act 2006 is contained in which section?
Answer: Section 175
Section 175 of the Companies Act 2006 imposes a duty on directors to avoid situations where they have, or could have, a direct or indirect interest that conflicts with the company's interests.
Which type of authority allows an agent to bind a principal when the agent acts outside their actual authority but the principal's conduct leads a third party to reasonably believe authority exists?
Answer: Apparent (ostensible) authority
Apparent or ostensible authority arises when a principal's words or conduct represent to a third party that the agent has authority to act, even if no such authority was actually granted.
Under English law, which of the following is a requirement for a valid deed?
Answer: It must be signed, witnessed, and delivered
For a deed to be valid it must be signed by the party, witnessed (attested), and delivered as a deed — required under the Law of Property (Miscellaneous Provisions) Act 1989.