FE-1 Company Law

Question 1

Under the Companies Act 2014, what is the most common type of private company in Ireland?

Accepted Answer

A private company limited by shares (LTD)

Answer

The Companies Act 2014 introduced the LTD as the default model for private companies in Ireland. It is a simplified company form with a single-document constitution, full capacity, and no requirement for an objects clause.

Question 2

What is the concept of separate legal personality in Irish company law?

Accepted Answer

A company is a legal entity distinct from its members, capable of owning property, suing, and being sued in its own name

Answer

The principle of separate legal personality, established in Salomon v A Salomon & Co [1897] and fundamental to Irish company law, means that upon incorporation, a company becomes a legal person separate from its shareholders, directors, and employees.

Question 3

Under the Companies Act 2014, what are the duties of a director?

Accepted Answer

To act in good faith in the interests of the company, act honestly and responsibly, exercise due care and skill, and comply with the Act

Answer

Section 228 of the Companies Act 2014 codifies directors' duties including acting in good faith in the interests of the company, acting honestly and responsibly, exercising care, skill, and diligence, and complying with the Companies Act and constitution.

Question 4

What is the doctrine of 'lifting the corporate veil' in Irish company law?

Accepted Answer

Courts may disregard the separate legal personality of a company to look at the reality behind it in certain exceptional circumstances

Answer

In exceptional circumstances, such as fraud, agency, or where the company is used as a sham, Irish courts may lift the corporate veil and look behind the company's separate personality to hold individuals personally liable.

Question 5

Under the Companies Act 2014, what is the minimum number of directors required for a private company limited by shares (LTD)?

Accepted Answer

One director (plus a separate company secretary, or two directors where one acts as secretary)

Answer

Under the Companies Act 2014, an LTD company requires a minimum of one director, but must also have a company secretary who cannot be the sole director. Alternatively, a company can have two directors, one of whom may also act as secretary.

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FE-1 Company Law