Presentation Transcript

1. English for Lawyers 4

   Lecturer: Miljen Matijašević e-mail: miljen.matijasevic@zg.t-com.hr Session 7, 2 May 2012
2. Today’s session Revision - Vocabularypractice Casestudy – contractlaw Forms of Business Organisation in the USA Vocabulary practice
3. Vocabulary practice
4. Vocabulary practice 2 Complete the following sentences with the words from the list. There is one more word than you need. You might have to change the form of the word, add a suffix and/or a prefix.
5. increase – foresee – strict – void – originalqualify – remote – cause – claim - sustain If the defendant is to be found liable for negligence, the damage _________ by the claimant must have been _________, and not too _________ from the tortious act itself in order to establish _________. Parties are considered to have entered into a contract if there has been _________ acceptance of the binding offer made by one party. If this criterion has not been met, the contract is considered as _________. If a product causes damage, the producer, distributor and/or seller have _________ liability for the damage. In cases where both tortious and non-tortious risks of damage are present, the tortious risk is referred to as the _________ risk, and the non-tortious as the _________ risk.
6. Revision of the last session Contract
7. Revision of the previous session What is the definition of contract? What are the necessary elements of a contract? What is a counter-offer? Can it make part of a contract? Does acceptance need to be communicated? Which types of contract must be in written form? What is the difference between a void and a voidable contract?
8. Casestudies ContractLaw
9. Davis v. General Foods Corp. (1937) Facts: P. had an idea for a new food product. P. wrote a letter to D. offering to reveal such idea, and D. responded with a letter stating that they would consider her idea, "but only with the understanding that the use to be made of it by [D.], and the compensation, if any, to be paid therefor, are matters resting solely in our discretion." P. revealed her idea, which D. used, and paid P. no compensation. P. sued. Nature of the Risk: When a seller discloses an idea after allowing the buyer the unlimited right to determine the price after use of the idea, he assumes the risk that the compensation may be less than he hoped.
10. Austin v. Burge (1911) Facts: The Defendant received and read a newspaper over the course of several years. He had at one time subscribed for a two-year period, but claims that after the expiration of those two years, he requested that service be stopped. The Claimant is the newspaper owner, who claims he never received notice of stoppage. Nature of the Risk: In the absence of a contract, the Claimant assumed the risk that the Defendant would not pay for his newspaper.
11. Forms of Business Organisation Company/corporate law
12. Forms of Business Organisation COMPANY LAW (UK) / CORPORATE LAW (US) deals with the creation and regulation of business entities a business entity - poslovni subjekt
13. Forms of Business Organisation Three main types: sole proprietor (a.k.a. sole trader) partnership limited company What do you think the main differences are and what kinds of businesses are they suitable for?
14. Sole Proprietorship The simplest and most common type of business organisation Owned by one person, who: has unlimited control over the business enjoys all the profits has unlimited liability for debts and losses
15. Sole Proprietorship Suitable for businesses such as self-employed hairdressers, plumbers, retail shopkeepers, barristers, translators, etc. Think of the advantages and disadvantages of being a sole proprietor!
16. Sole Proprietorship one person – owner and manager: independent decision-making keeps all the profits simple to set up few formalities unlimited liability for debt and losses risks increase if the business becomes very successful hard to raise substantial capital Advantages Disadvantages
17. Partnership association of two more more persons (usually up to 20) subject to a partnership agreement common among accountants, solicitors, architects, etc. a simple partnership – not a legal person
18. Partnership Agreement May regulate the following: duration of the partnership its name and business the manner of sharing profits, losses and costs capital contribution joining and leaving the partnership restrictions imposed on the partners etc.
19. Partnership capable to raise and utilize more capital brings together people with different skills profits distributed limited freedom and decision-making power certain disadvantages in comparison with a limited company Advantages Disadvantages
20. Limited Company / Corporation Limited company (UK) / Corporation (US) An artificial person created under law and empowered to achieve a specific purpose A legal entity (pravni subjekt) which can own property, enter into contracts, sue and be sued – an identity separate from its shareholders
21. Limited Company / Corporation Some characteristics: perpetual life (perpetual succession) limited liability transferability of shares access to capital professional management
22. Limited Company / Corporation usually starts out as a Private Limited Company (Ltd.) Needs to be registered – gets a registered number (reg.no.) and Certificate of Incorporation (UK) This is called: company registration (UK) or incorporation (US)
23. Limited Company / Corporation Constitutional documents: Memorandum of association states the principal objects (purposes) of the company Articles of association (statut društva) sets out the relationship between the company and its shareholders limited liability issue of new shares
24. Limited Company / Corporation A company has: shareholders a Board of Directors (managers of the company’s operations) creditors (those to whom the company owes money)
25. Limited Company / Corporation if a private limited company needs to raise capital in order to expand its business, enter into a major project, it can decide to either: borrow money from an investment bank subject to payment of interest, whose rate depends on the risks involved raise capital by selling its shares on the stock market
26. Limited Company / Corporation if a company issues shares and puts them on the stock market, we say that it is a publicly listed company and is referred to as a public limited company (plc) it issues a prospectus*, offering a public sale of its shares, listing them at a stock exchange** (e.g. FTSE – the London Stock Exchange) *prospekt, javni poziv na kupnju dionica **burza dionica, vrijednosnih papira; stock market – tržište vrijednosnih papira
27. Public Limited Company (plc) the company is run by the Board of Directors the Board is accountable to the shareholders, although the Board decides how to distribute profits they can decide to pay a dividend to the shareholders, or re-invest the profits into the business a dividend is a proportion of the profits paid to the shareholders
28. Public Limited Company (plc) PLCs hold Annual General Meetings (AGM) where the performance of the company in the previous year is presented, as well as plans and strategies for the future an Annual Report is produced and submitted to the shareholders members of the Board of Directors may submit themselves for re-election by the shareholders
29. Limited Company / Corporation limited liability, i.e. no personal liability of the shareholders perpetual life can sell shares, easier to raise capital ease of transfer more complicated and expensive to set up lots of formalities Advantages Disadvantages
30. Key terms 1 sole proprietor/trader partnership limited company corporation legal entity unlimited liability partnership agreement transferability of shares perpetual life private limited company company registration registered number articles of association
31. Key terms 2 public limited company listed company prospectus shareholder Board of Directors stock market stock exchange accountability AGM annual report dividend
32. Vocabulary practice
33. liable – sue – manage – owe – proprietor register - own - invest – enter – legal A ________ person has rights and duties under the law just like a natural person. The board of directors ________ the affairs of the company and makes company policy. A company can ________ property, ________ into contracts and ________ other persons. A shareholder ________ money by buying shares in a company. A sole ________ owns a company and is personally ________ for its debts.
34. Thank you for your attention!