, LML4806 Assignment 1 (COMPLETE ANSWERS)
Semester 2 2026 (256940) - DUE 18 August 2026; 100%
Correct solutions and explanations.
QUESTION 1.1
Advice to Mbeu Wealth (Pty) Ltd on the validity of the calling and
convening of the shareholders' meeting
Mbeu Wealth (Pty) Ltd has strong prospects of success in applying to
court for an order declaring that the calling and convening of the
shareholders' meeting held on 15 May 2026 were irregular and invalid.
Several provisions of the Companies Act 71 of 2008 were not complied
with, and these procedural defects are substantial.
(a) The shareholders' meeting was not validly called
The Memorandum of Incorporation (MOI) of Spartacus Ltd provides
that only the board of directors has the authority to call a shareholders'
meeting. The facts indicate that Pamela, acting as chairperson, sent the
notice of the meeting while purporting to act on behalf of the board.
However, no board meeting had been held and no board resolution
authorising the calling of the shareholders' meeting had been passed.
Section 73 of the Companies Act requires the board to exercise its
powers collectively through properly constituted board meetings or by
written resolution where permitted. Individual directors, including the
chairperson, have no independent authority to exercise powers reserved
for the board unless specifically authorised.
Since Pamela acted without the approval or authority of the board, the
decision to convene the shareholders' meeting was unauthorised and
contrary to both the MOI and the Companies Act. The meeting was
therefore improperly called.
(b) Failure to comply with the statutory notice period
Semester 2 2026 (256940) - DUE 18 August 2026; 100%
Correct solutions and explanations.
QUESTION 1.1
Advice to Mbeu Wealth (Pty) Ltd on the validity of the calling and
convening of the shareholders' meeting
Mbeu Wealth (Pty) Ltd has strong prospects of success in applying to
court for an order declaring that the calling and convening of the
shareholders' meeting held on 15 May 2026 were irregular and invalid.
Several provisions of the Companies Act 71 of 2008 were not complied
with, and these procedural defects are substantial.
(a) The shareholders' meeting was not validly called
The Memorandum of Incorporation (MOI) of Spartacus Ltd provides
that only the board of directors has the authority to call a shareholders'
meeting. The facts indicate that Pamela, acting as chairperson, sent the
notice of the meeting while purporting to act on behalf of the board.
However, no board meeting had been held and no board resolution
authorising the calling of the shareholders' meeting had been passed.
Section 73 of the Companies Act requires the board to exercise its
powers collectively through properly constituted board meetings or by
written resolution where permitted. Individual directors, including the
chairperson, have no independent authority to exercise powers reserved
for the board unless specifically authorised.
Since Pamela acted without the approval or authority of the board, the
decision to convene the shareholders' meeting was unauthorised and
contrary to both the MOI and the Companies Act. The meeting was
therefore improperly called.
(b) Failure to comply with the statutory notice period
