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Business and Corporate Law Essay
Pages 6 (1506 words)
There is no provision in the Companies Act 2006 that specifically prohibits the issues of shares by a private company for non-cash consideration of rent payable. Section 580 generally prohibits the issue of shares at a discount only. According to the Companies House payment for shares can be made in a variety of ways including cash, goods, services, property, goodwill, or know-how.
Companies Act 2006 has codified the duties of directors and has included these duties in the relevant sections. While Section 170 lays down the scope and nature of general duties Sections 171 to 177 and section 182 lays down the specific duties of the directors. The duties covered under these sections are made to replace the common law rules and equitable principles on which the duties of directors are based earlier. Section 170 also provides that these general duties "shallbe interpreted and applied in the same way as common law rules or equitable principles, and regard shall be had to the corresponding common law rules and equitable principles in interpreting and applying the general duties". 2
Under section 171 the directors have a duty to act within the statutory powers granted to them. This duty must be exercised in accordance with the constitution of the company and the powers must be exercised for proper purposes. For the purpose of general duties the Companies Act 2006 has defined the constitution to include the Articles of the company and decision taken in accordance with the Articles will be construed as taken within the constitution of the company. ...
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