, MRL2601 ASSIGNMENT 1 SEMESTER 1 2026 – FULLY ANSWERED
(DUE 6 MARCH 2026)
Question 1
Difference between a Partnership and a Company
A partnership is an agreement between two or more persons to carry on a
business together, but it does not have a separate legal personality; the
partners and the partnership are legally the same. In contrast, a company
is a separate legal entity, independent of its shareholders, with its own
rights and obligations (Salomon v Salomon).
In a partnership, the partners have unlimited personal liability for the debts
of the business, whereas shareholders in a company enjoy limited liability,
meaning they are only responsible up to the amount they invested.
Ownership and management also differ: partnerships are typically owned
and managed by the partners, while companies are owned by shareholders
and managed by directors.
Partnerships lack perpetual succession, dissolving if a partner dies,
resigns, or becomes insolvent, while companies continue to exist
regardless of changes in ownership. Finally, partnerships are easy to form
and regulated mainly by common law, whereas companies must be
registered under the Companies Act 71 of 2008 and comply with stricter
legal requirements. Overall, partnerships are simpler but riskier, while
companies offer protection, credibility, and continuity—factors crucial in
global aviation law.
Question 2
Legal Nature of a Trust
A trust is a legal arrangement in which a founder transfers assets to
trustees, who manage them for the benefit of beneficiaries or for a specific
purpose. A trust is not a separate legal person, but its assets are distinct
from the personal estates of the founder, trustees, and beneficiaries.
(DUE 6 MARCH 2026)
Question 1
Difference between a Partnership and a Company
A partnership is an agreement between two or more persons to carry on a
business together, but it does not have a separate legal personality; the
partners and the partnership are legally the same. In contrast, a company
is a separate legal entity, independent of its shareholders, with its own
rights and obligations (Salomon v Salomon).
In a partnership, the partners have unlimited personal liability for the debts
of the business, whereas shareholders in a company enjoy limited liability,
meaning they are only responsible up to the amount they invested.
Ownership and management also differ: partnerships are typically owned
and managed by the partners, while companies are owned by shareholders
and managed by directors.
Partnerships lack perpetual succession, dissolving if a partner dies,
resigns, or becomes insolvent, while companies continue to exist
regardless of changes in ownership. Finally, partnerships are easy to form
and regulated mainly by common law, whereas companies must be
registered under the Companies Act 71 of 2008 and comply with stricter
legal requirements. Overall, partnerships are simpler but riskier, while
companies offer protection, credibility, and continuity—factors crucial in
global aviation law.
Question 2
Legal Nature of a Trust
A trust is a legal arrangement in which a founder transfers assets to
trustees, who manage them for the benefit of beneficiaries or for a specific
purpose. A trust is not a separate legal person, but its assets are distinct
from the personal estates of the founder, trustees, and beneficiaries.
