Some legal aspects of the formation of companies

Abstract

In the Report of the Commercial Partnerships Law Reform Commission 1956 it is clearly stated that the source of the provisions regulating limited liability companies is the U.K. Companies Act 1948. This statement is important because it indicates the path the Courts have to follow if they are confronted with a case to which no provisions in our law are applicable. Thus, in the same report, it is also stated that for the purpose of the interpretation of certain provisions reference may be made to text-books and cases on the legislations used as a model. However, the commissioners caution that our law is not a wholesale reproduction of the model; there are some outright changes in additions and in omissions which, the Commisioners say, have been made with a purpose. As regards departures from the model, these may have been counselled by local requirements or practices or made necessary by some difference between our legal system and the principles embodied in the model. On the other hand, the reason for an omission may be twofold: "either (a) they were regarded as repugnant to our law or as not suitable for introduction into our system at the present stage, or (b) they were not deemed to be necessary because they were already covered by the general principles of our law or resulted manifestly or by inference from other provisions of the draft itself. Except in the latter case, the intention of the Commission was that any prevision so omitted was to be inapplicable".