CASE STUDY Robert is a sole trader pharmacist. Notwithstanding the downturn in the economy, his business is going from strength to strength, due to the fact that he has FINALLY started taking advice from his wife Anna. On the advice of his accountant, Mr. Tayto, he has decided that the time has come to form a company with liability limited by shares, and to transfer the existing business to that company.
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Robert will be the majority shareholder, and his wife and two (adult) children will take one share each. Robert, his wife Anna, and their accountant Pa will all be appointed directors. It has been decided that Robert will act as managing director of the company. The company is to be called “Pharmacy 4 u Ltd.” Robert is determined that the company will remain in the hands of the family. He has a pathological distrust of anyone outside his own family.
Robert seeks your advice on the following matters; (a) What steps must be followed in order to form the company. (b) What the term-limited liability means (c) Can he ensure that the company will remain in the hands of family? If so, how can he achieve this? What, in your opinion is the most effective way of ensuring that company ownership will remain in the hands of family into the future? (Candidates must refer to relevant case-law and statutory provisions in their answer.) Get Business Law homework help today
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