Business Mediums
Incorporated vs. Unincorporated
Incorporated - Enterprise gone through formal legal process of becoming corporation.
Laws governing how to form different in each country.
Largely regulated from external bodies.
Companies - Public or private; limited or unlimited; limited by shares or guarantee.
Limited Liability Partnership.
Unincorporated - Commercial enterprise owned privately by one or more people.
Doesn't require registration - Sole trader & general partnerships.
Incorporated Businesses
Corporations by Royal Charter/Private Act.
'Old way' - BBC, Bank of England.
Proposed for press regulatory body.
Industrial & provident societies, credit unions, friendly societies.
Created under their own statutes, not Companies Act 2006.
Private Limited Company (Ltd.)
Liability limited by shares which can NOT be offered to public.
Registered at Companies House.
Subject to formalities of common law and statute (Companies Act 2006)
Companies limited by guarantee.
Often used by charities (may be exempt from Ltd.)
Liability limited not by shares but by members agreeing to pay a fixed amount if companies
Public Limited Company (plc)
Can offer shares to public.
Governed by Companies Act 2006 and rules & regulations of Stock Exchange where share
'Not for profit' companies.
, Unincorporated associations.
Individuals agreeing to come together with a common purpose.
Includes some charities, voluntary group, sports club etc.
Reduced CA 2006 formalities.
No separate legal personality.
Partnerships.
Fewer formalities than limited company.
Partners sharing profit or loss.
More risk & exposure to liability.
No separate legal personality.
Partnership Act 1890 - Codification of common law.
Partnership Act 1890, s1 - 'Relation which subsists between persons carrying on a busines
'Between persons' - Includes legal persons.
Must be carrying out business venture - Partnership Act 1890, s45.
Types of Partners
General - Person who joins with at least one other person to form a business.
Sleeping - Provides capital but doesn't take active role in managing business.
Salaried - No right to participate in profits and losses of partnership and generally no v
partnership.
Duties of partners
Fiduciary duty - Good faith and confidence.
Generally established when confidence given by one person is actually accepte
Partnership Act 1890.
s28 - Duty to disclose information.
Law v Law [1905] 1 Ch 140.
Hogar Estates v Shebron Holdings Limited (1979) 101 DLR (3d) 509 (C
s29 - Duty to account for secret profits.
‘Every P must account to firm for any benefit derived by him without co
transaction concerning partnership, or from any use by him of partners
connection’
John Taylors v Mason [2001] EWCA Civ 2106
Incorporated vs. Unincorporated
Incorporated - Enterprise gone through formal legal process of becoming corporation.
Laws governing how to form different in each country.
Largely regulated from external bodies.
Companies - Public or private; limited or unlimited; limited by shares or guarantee.
Limited Liability Partnership.
Unincorporated - Commercial enterprise owned privately by one or more people.
Doesn't require registration - Sole trader & general partnerships.
Incorporated Businesses
Corporations by Royal Charter/Private Act.
'Old way' - BBC, Bank of England.
Proposed for press regulatory body.
Industrial & provident societies, credit unions, friendly societies.
Created under their own statutes, not Companies Act 2006.
Private Limited Company (Ltd.)
Liability limited by shares which can NOT be offered to public.
Registered at Companies House.
Subject to formalities of common law and statute (Companies Act 2006)
Companies limited by guarantee.
Often used by charities (may be exempt from Ltd.)
Liability limited not by shares but by members agreeing to pay a fixed amount if companies
Public Limited Company (plc)
Can offer shares to public.
Governed by Companies Act 2006 and rules & regulations of Stock Exchange where share
'Not for profit' companies.
, Unincorporated associations.
Individuals agreeing to come together with a common purpose.
Includes some charities, voluntary group, sports club etc.
Reduced CA 2006 formalities.
No separate legal personality.
Partnerships.
Fewer formalities than limited company.
Partners sharing profit or loss.
More risk & exposure to liability.
No separate legal personality.
Partnership Act 1890 - Codification of common law.
Partnership Act 1890, s1 - 'Relation which subsists between persons carrying on a busines
'Between persons' - Includes legal persons.
Must be carrying out business venture - Partnership Act 1890, s45.
Types of Partners
General - Person who joins with at least one other person to form a business.
Sleeping - Provides capital but doesn't take active role in managing business.
Salaried - No right to participate in profits and losses of partnership and generally no v
partnership.
Duties of partners
Fiduciary duty - Good faith and confidence.
Generally established when confidence given by one person is actually accepte
Partnership Act 1890.
s28 - Duty to disclose information.
Law v Law [1905] 1 Ch 140.
Hogar Estates v Shebron Holdings Limited (1979) 101 DLR (3d) 509 (C
s29 - Duty to account for secret profits.
‘Every P must account to firm for any benefit derived by him without co
transaction concerning partnership, or from any use by him of partners
connection’
John Taylors v Mason [2001] EWCA Civ 2106
