- 20 Marks
BCL – May 2019 – L1 – Q4 – Company Law
Discusses the rights of parties in share allotment and revocation under company law.
Question
On 1st January 2018, Parentsgold Ltd, a new and promising company, had its prospectus published. On 3rd January 2018, Frank Larry sent an application for GH¢100,000 worth of shares in Parentsgold Ltd. On the same 3rd January, Abena Manu submitted an application for GH¢50,000 worth of shares, but on 8th January 2018, she sent a mail revoking her application. Both applicants remitted the requisite application moneys on the day of their application.
Due to lack of a quorum, the Board of Directors of Parentsgold Ltd could not meet to consider the applications and allot shares until 15th September 2018. Frank Larry was informed on 16th September 2018 that his application had been accepted and that GH¢100,000 worth shares had been duly allotted to him, but he wrote back refusing the allotment.
Required: Advise the parties of their rights, if any.
(20 marks)
Find Related Questions by Tags, levels, etc.
- Tags: Company Law, Contract Law, Prospectus, Revocation, Share Allotment
- Level: Level 1
- Topic: Contract Law
- Series: MAY 2019