Module title: Business Law

Name of evaluation: Michael Ltd

Course: E-MBA 13B

Submission date: Friday, 8th 04 2015

Period: no later than 18: 00PM

Distribution location:

Member in group: 1 ) Nguyб»…n Thanh MaiEMBA13102

2 . Nguyб»…n Thб»‹ Ngб»ЌcEMBA13112

three or more. Nguyб»…n VДѓn HuyГЄn EMBA13077

Word depend: 1, 313 words.



I. In the case of material shipped to Refressment Limited and requests received by simply Refressment Ltd were not passed on to Moonflowers Ltd3 II. There were the passed by Refressment Ltd on to Moonflowers. 5 CONCLUSION7



In this case, before giving advice to Michael Ltd, is actually necessary to crystal clear the relationship between Strongman Plc., Refressment Limited and Moonflowers Ltd. With each circumstance case, there is one tips to Michael Ltd. 1st, Strongman Plc. is the parent company in a group of businesses operating in the availability and distribution of normal water spot products. Moonflowers Ltd is a wholly – held subsidiary of Strongman Plc., and was only the latest incorporated. Therefore , relationship between Strongman Plc. and Moonflowers Ltd can be parent – subsidiary firm. According to Common Rules, " the parent firm has control over the subsidiary” (slide organization under prevalent law – lecture 2) but it can " independent entities and independent of one another”. Yet , under common law, a court may " touch the corporate veil" of the parent if it locates an appearance of impropriety through sketchy share transactions or different fraudulent means of avoiding the subsidiary's financial obligations. Courts may also subordinate the parent's debt to outside the house creditors in the event the parent offers engaged in unjust conduct, just like influencing new creditors to extend credit for the subsidiary although knowing the subsidiary's poor personal finances (Shaa Hudson, Demand Multimedia, smallbusiness. chron. com). Prior to explaining Strongman and Moonflowers having liable to spend the financial obligations of Refressment or not really, it's important to identify the material delivered and requests received of Refressment Limited passed or perhaps not passed on to Moonflowers Ltd. My spouse and i. In case of material delivered to Refressment Ltd and orders received by Refressment Ltd are not passed on to Moonflowers Limited 1 . Responsibility of Moonflowers Ltd.

Obviously, there is no responsibility of Moonflowers Ltd to Refressment Limited, because there is simply no contract between them. Thus, Jordan Ltd simply cannot ask Moonflowers about the debts of Refressment Limited, even though Refressment Ltd is one part of Strongman Plc. or perhaps not, mainly because Refressment Limited and Moonflowers Ltd is usually two independent companies. 2 . Strongman Plc.

About Strongman Plc., since Strongman Plc. holds almost all shares in Refressment Limited, there are two sorts of organization which can result to romance and decision as well as liabilities between Strongman Plc. and Refressment Limited. a. Refressment Ltd can be one supplementary of Strongman Plc.

In fact, in most circumstance, the debt of Refressment Ltd is not really related to Strongman Plc. However , according to company deal under common law, Strongman Plc. " is liable to pay injuries to each other party to the pre – incorporation contract” in the event Refressment Ltd is " registered but does not ratify the contract”. (invigorlaw. com) b. If Strongman can be one general partner ( Limited partnership) or in the event that Strongman is Corporation in Refressment Ltd Strongman Plc. is one particular shareholder of Refressment Ltd. However , the corporation was distinct entity from its shareholders. Based upon case " Salomon sixth is v A Salomon and Co Ltd [1897] AC twenty-two, Strongman Plc has not accountable with the financial debt of Refressment Ltd. Total, with no handed trading from Refressment Ltd on to Moonflowers Ltd, Moonflowers Ltd does not have responsible with the debt of Refressment Limited, so Michael jordan cannot obtain the payment via Moonflowers. Besides, Strongman Plc. in most case still have not any liable with action of Refressment Limited, but if Strongman Plc. acquired intervention on the...

References: 5. Distinction Between Subsidiary And Wholly Owned or operated Subsidiary. Lawtecher. com. [Accessed on Apr 07, 2015


9. Douglas Kerr. Hiding Behind Subsidiaries: Keeping Parents Liable. GULS. January 12, 2014.

12. Marlies Braun. UK: What is A Parent Company Liable For The Actions Of Its Part?. Mondaq. October 18, 2011.

10. Shaa Hudson, Demand Mass media. The Relationship Among a Company & Its Additional. Chron. [Accessed on April 08, 2015]


13. Companies Act 2006. Legislation. gov. uk, [Accessed in April '07, 2015]

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