Student

Question 1
The chance in Foss v Harbottle appears to be scratchy to the nonage shareh quondam(a)ers which prompted reform of the law in this regard. Explain this regularize and how it was reformed both at statute and common law. [20]

The rule of law known as the Foss v Harbottle rule has resulted from the refusal of the dally to interfere with the management of the company at the instance of nonage shareholders who for one reason or the other are dissatisfy with the contact of the companys affairs by the legal age or by the board of directors. The Foss v Harbottle convention was number 1 clearly articulated in 1843 in the case from which it takes its be and it has since spawned an immense volume of case law and legal literature.
The old common law position is based on the principle of the Majority Rule determined down in Foss v Harbottle (1843). The absolute mass rule stands for the proposition that the decisions and choices of the majority will always follow over those of the minorities.The major shareholder (controls 75%) enjoys greater rights, powers and privileges deep down the company.



Thus a substantial amount of power is placed in the hands of the majority shareholders and that by virtue of the majority rule, the minority shareholders (controls 25%) are required to accept the decisions made by the majority shareholders. In much(prenominal) circumstances, the minority shareholder cannot invite for court intervention because Foss v Harbottle does not cater for minority members who complain of a unseasonable done to the company provided that the majority shareholders do not wish to take any fill against the wrong committed.
As a general principle laid down in Foss v Harbottle, where it is aver that a wrong has been done to the company hence proper claimant in such an action is the company itself and where the company is competent to settle the alleged wrong itself or the company is competent to ratify or condone an irregularity by its own internal procedure, then no individual member may...If you want to get a full essay, order it on our website: Ordercustompaper.com



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