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213 Cards in this Set

  • Front
  • Back
Acceptance
In the context of contract law, an acceptance is a communication or action taken by a person to agree to an offer that has been made to enter into a contract.
Accepted for honour
Where a person who is not the drawee may incur liability as the acceptor.
Accounting reference period
Another name for the company’s financial year end. Newly incorporated companies are given nine months to nominate an accounting reference period. Failure to do so means that the Registrar automatically assigns the last day of the month in which the anniversary of incorporation falls as the company’s accounting reference date.
Agent
One who acts under the authority of another, the principal, in order to create a legal relationship between the principal and a third party.
Agreed overdraft
An overdraft which has been agreed either verbally or in writing.
Allotment
In relation to shares is the process by which a person acquires the unconditional right to be included in the company’s register of members in respect of those shares.
Annual Percentage Rate (APR)
Calculated according to standard formulae, this enables prospective borrowers to compare, on an equal basis, the cost of one credit agreement against another.
Annual Return
Return made by a company to the Registrar, including the following information:
• the company name
• the address of the registered office
• the principal business activity
• the address where registers of the members and
debenture holders is kept
• details of the issued share capital
• a list of the current members of the company and those
who have ceased to be members since the last return.
Apparent authority
The perceived right of a person to act on behalf of another person. Arises from the representation made by the principal to the third party. See also Ostensible authority .
Appropriate trade premises
The place where a creditor normally carries out business.
Appropriation
Money set aside for a particular use.
Articles of Association
A constitutional document of a limited company, registered with Companies House. A set of internal rules which defines the rights of the members of a company between themselves and a description of the manner in which the business of the company is to be conducted.
Articles of partnership
A written contract creating a partnership.
Assign
The making over of any right to another.
Assignment
Transfer, in writing, of rights in property from one party (the assignor) to another (the assignee).
Auditor
A person appointed to examine the books of account and the actual accounts of a registered company, and to report on them to the members. The audit report must state whether or not the accounts have been properly prepared and give a true and fair view of the company’s financial position. The Companies Act 1985 contains provisions dealing with auditors’ qualifications and the rights which they have to enable them to fulfil their duties effectively.
Bill
In the context of new legislation, a Bill is a draft Act of Parliament. In its passage through the legislative process, a Bill may be passed unchanged or with amendments sanctioned by the two Houses.
Bill of exchange
An unconditional order in writing addressed by one person to another signed by the person giving it, requiring the person to whom it is addressed to pay on demand or at a fixed or determinable future time a sum certain in money to, or to the order of, a specified person or to bearer.
Bonus shares
Shares given to a member usually proportionate to his existing shareholding and requiring no fresh consideration to be provided by him. Such shares usually arise from capitalisation of net profits.
Breach
This occurs when the terms of a contract are broken.
Broker
An agent who does not have possession of his principal’s goods and who does not have the authority to sell them in his own name. Examples include stockbrokers and insurance brokers.
Bye-law
Bye-law
Cancellable agreement
Canvassing
Capacity
Capital
redemption reserve
Case law Civil law Claimant
Common law Companies Act 1985 Companies Act 1989
Connected lender
A type of secondary legislation passed mainly by agencies of government on the basis of delegated powers under Acts of Parliament.
Cancellable agreement
Regulated credit agreement whereby the borrower is provided with a cooling off period during which he may cancel the agreement he has signed. Credit should not be made available until this period has expired.
Canvassing
The making of oral representations to a third party by a lender in an attempt to encourage the third party to avail themselves of the lender’s services.
Capacity
The ability to do something legally. For example, Most adults have the capacity to enter into most contracts, but children have a limited capacity to enter into contracts. Mentally incapacitated persons are still further limited in respect of their legal capacity. The capacity of a company may be limited by its objects clause.
Capital
redemption reserve
A reserve constituted by a transfer of a notional amount on the redemption or purchase by a company of its own shares.
Case law
Law which has been created by selecting certain customs and applying them in all future cases.
Civil law
The branch of law that deals with disputes between persons and/or entities.
Claimant
Sometimes called the plaintiff. This is the person or entity that brings a legal case against a defendant. In references to cases, the plaintiff/claimant is named first and the defendant is named second.
Common law
The traditional system of judge-made law passed down over many centuries.
Companies Act 1985
The main statute that regulates limited companies in the UK.
Companies Act 1989
Important amending legislation that permits a company to adopt general trading powers, thereby removing problems caused by ultra vires actions. The Act also empowers companies to adopt elective and written resolutions, subject to unanimous agreement of members.
Connected lender
A lender who is introduced to his customer by a supplier of goods and who finances a contract between the supplier and that customer.
Consensus in idem
Agreement about the same thing.
Consideration period
In relation to agreements secured over land, a period prior to the agreement being signed during which the prospective borrower may withdraw from the transaction.
Contract
An agreement between two persons or bodies, entered into on a voluntary basis with a view to establishing a legally binding relationship in terms of specific outcomes.
Contractual capacity
The ability to enter into legally binding agreements.
Contributory negligence
Many cases show that the carelessness, in one form or another, of a customer has contributed to a loss sustained by a bank, usually through a forgery by a fraudulent clerk or servant. The obligation of a customer to avoid negligence in this regard was defined by Kennedy, J, in Lewes Sanitary Steam Laundry Co Ltd -v- Barclay and Co Ltd, 1906, 95 L.T. 444, as a “duty to be careful not to facilitate any fraud which, when it has been perpetrated, is seen to have in fact flowed in natural and uninterrupted sequence from the negligent act”.
Corporate veil
The legal concept which draws a veil over the identity of a company following registration so that its personality is kept separate and distinct from that of the members. This veil, however, may be lifted under certain circumstances.
Council of
The Stock Exchange
Appointed by the UK government as the competent authority for the purposes of certain European Directives dealing with, inter alia, admission of securities to official listing. It exercises functions under the Financial Services and Markets Act 2000, subject to the reserve power of the Secretary of State to issue directions of compliance.
Counter-offer
An offer made in response to an earlier offer. The effect of a counter-offer is to cancel the original offer.
Credit
For the purposes of the Consumer Credit Act 1974, this includes cash loans or any other form of financial assistance whether in sterling or foreign currency (but excluding finance for foreign trade) which is provided on terms of repayment in cash or in any other form.
Creditor
A person to whom a debt is owed. Also a provider of credit or lender of money. In terms of the Consumer Credit Act, a creditor may be an individual, a partnership, an unincorporated body or a limited company.
Criminal law
That part of the law which prohibits certain acts and lays down penalties for its infringement.
Damages
The main legal remedy for breach of contract, based on common law. Damages always comprise a financial award to the injured party, not a punishment to the party who is in breach of contract.
Debenture
A document which states the terms of a loan to a company, indicating the date of repayment and the rate of interest. The debt, which is usually long term, may be secured by a charge over the company’s property. Capital received from the issue of a debenture or debentures is termed loan capital.
Debtor
One who owes money to another.
Decree
Decision of court on question of fact.
Deed
A formal legal document.
Deed of partnership
A written contract creating a partnership which is signed and sealed.
Defamatory
Injurious to another’s reputation or creditworthiness.
Default notice
Notice required under Section 87(1) of the Consumer Credit Act 1974 advising a borrower of the nature of a default, how and within what timescale it may be remedied and the consequences of failing to remedy it.
Director
An officer of a company accountable to the members and bearing fiduciary , common law and statutory responsibilities under the law.
Disclosed principal
Where the identity of the principal is revealed to the third party.
Dissolution
The termination of a partnership either by court order or subject to the terms of the partnership agreement.
Dividend
The share of profit that is distributed by the company to its owners.
Equity
The making of law by judges in a situation where there is no law at present and whose effect is what the judge considers to be a fair and equitable interpretation of the circumstances.
Excerpt minute
Extract from minutes of meeting.
Exclusion clause
A term in a contract that specifically excludes a particular feature of the bargain. For example, household insurance policies often exclude claims for damage caused by war.
Executive director
A full time director – both a director and an employee.
Express appointment
When an agent has been appointed either orally or in writing.
Express authority
In this situation an agent will be regarded as having the authority to undertake the tasks which a person in his particular line of business usually has authority to do; for example, a partner dealing with partnership affairs is treated by law as an agent of the firm.
Express terms
The specific terms that are written into a contract or agreed by the two parties.
Extra judicial
Outwith court authority.
Extraordinary General Meeting
Any meeting of a company which is not an AGM.
Factor
An agent who has possession of his principal’s goods and who has authority to sell in his own name.
Fictitious payee
Where the payee is a fictitious or non-existing person, a bill or cheque may be treated as payable to bearer. (Section 7(3), Bills of Exchange Act, 1882). In Bank of England -v- Vagliano, 1891, AC 107, the meaning of a fictitious person was enlarged to include a real person who never had nor was intended to have any right to the bills.
Fiduciary relationship
A relationship of trust which includes contracts between principal and agent. Arising from common law, the moral responsibility of a person or organisation to act in the best interests of those to whom they are accountable.
Fraud
Obtaining funds illegally in a deliberate and premeditated manner.
Fraudulent trading
Carrying out a business with the intention of making financial gain at the expense of a company’s creditors. This is one ground for lifting the corporate veil.
Frustration
Where a contract is impossible to perform, and so there is no contract at all, and as such it is void from the outset.
General partner
A partner who contributes towards the firm’s capital and who participates in the management of the firm and
167
Half truth Hire purchase
Holding company Holding out
Implied authority Implied terms
Imprescriptible Incorporation
Indemnify Individual
Injunction
Innocent misrepresentation
Innominate term
shares in its profits. He must also share any losses of the partnership to the full extent of his private resources. Also known as an active partner.
Half truth
A statement which, whilst true in itself, withholds some explanation that would alter its whole bearing.
Hire purchase
A method of purchasing goods through a credit agreement. The lender purchases the goods and hires them to the customer, with ownership passing to the customer when the loan is fully discharged.
Holding company
A company which controls a subsidiary company or the parent company of a group of companies.
Holding out
An example of personal bar where an agent who has no actual authority conferred on him either expressly or by implication; he only appears to have authority.
Implied authority
The authority of a person as it appears by virtue of his position, for example, a Chief Executive.
Implied terms
The conditions that can be assumed to be a part of a contract even though they are not specifically written into it or agreed. The courts often have to decide whether terms are implied.
Imprescriptible
Never prescribes through a lapse of time, no matter how long
Incorporation
The formal procedure which describes the registration of a company under the Companies Acts 1985 and 1989, and on completion of which a company is given its own personality and identity.
Indemnify
To agree to discharge from liabilities incurred.
Individual
In terms of the Consumer Credit Act 1974, an individual may be a private citizen, a sole trader, a partnership or an unincorporated body.
Injunction
An order by a court compelling someone to refrain from doing something.
Innocent misrepresentation
A statement that is made honestly, but if it is untrue, it may induce a party to enter into a contract which they would not otherwise have entered, under what is known as “essential error”.
Innominate term
A condition of a contract for which there is some doubt as to whether it comprises a term or a warranty.
Institutional writings
Sources of legal authority which can go back for centuries. If there is no statute and/or precedent, institutional writings might give some guidance as to where the law rests and how a particular case ought to be judged.
Irrevocable
Unable to be recalled or cancelled.
Jointly and severally
Relevant to joint bank accounts and also to partnership law. The term means that all parties own all the funds. Similarly, all parties are each liable for any monies owed. On the death of one party, the funds are automatically owned by the survivor(s). Partners are jointly and severally liable also.
Judicial interruption
Interrupted by court proceedings.
Judicial precedent
The reliance of courts on previous decisions. Precedent may be binding or persuasive.
Jurisdiction
The scope of authority of a court.
Legislation
The body of law laid down by Parliament and measures
such as by-laws and Statutory Instruments.
Liable
Legally responsible.
Lien
A remedy for breach of contract which allows the
aggrieved party who is in possession of another’s
property to keep possession of it until that other pays
some debt which is due.
Limited partner
A partner whose liability is limited to the extent of the
capital he has agreed to contribute; he cannot participate
in the management of the business but is entitled to a
share of the profits.
Liquidator
Appointed to realise the assets to the best advantage on
the winding up of a company and to distribute the
proceeds, after payment of costs, among the creditors.
Litigation
Resort to a civil court to resolve a dispute between two
parties.
Magistrates Court
The lowest level courts that deals mainly with criminal
cases
Managing Director
An executive director of the company who is appointed to
deal with the day-to-day management of the company.
Mandate
Authority given by person to another to carry out an act
on his behalf. A written instruction to a bank by its
customer to carry out the operation of certain aspects of
the account in a prescribed manner.
Meeting of classes of shareholders
A meeting normally convened to allow the holders of a
particular class of shares to consider and vote on variations of the rights of that class.
Memorandum of Association
One of the two constituent documents of a company,
the other being the Articles of Association. It contains
certain compulsory clauses laid down by the Companies
Act 1985 and defines the constitution and objects of the
company.
Merger
When two companies are brought together to form the
one company and it is usually a mutually beneficial
arrangement.
Minor
A person who has yet to reach the age of 18 years
(England and Wales only).
Misrepresentation
A statement made prior to a contract coming into effect
that causes one person to be misled in relation to the
meaning or significance of the contract.
Misrepresentation can be innocent, negligent or
fraudulent.
Money laundering
The processing of illegally acquired funds through the
financial system in order to disguise the origins of these
funds.
Negative prescription
Period of time, 5 or 20 years, after which rights are lost.
Negligence
A tort (or civil wrong) that occurs when one party fails
to exercise a proper duty of care to another party, with
harm suffered to that party as a direct consequence.
Non-cancellable agreement
Regulated credit agreement which does not afford the
borrower any cancellation rights. Credit can be made
available immediately.
Non-executive director
A part time director.
Non-existent principal
Where there is no principal and the agent is acting on
his own.
Notary public
Originally a notary was a person who only took notes or
minutes and made drafts of writings. He was called by
the Romans “notarius”. The duty of a notary, so far as a
banker is concerned, is to present dishonoured bills and
“note” them for non-acceptance or non-payment, and if necessary, afterwards to extend the noting into a protest.
Novation
Where a new obligation is expressly substituted for a
prior obligation.
Offer
An invitation by a person or entity, communicated to
another person or entity, with a view to entering into a
legally binding contract.
Offeree
A person or entity that receives an offer.
Offeror
A person or entity that makes an offer.
Off-market purchases
Purchases of shares which are not made in normal
trading on the Stock Exchange or other UK recognised
investment exchange. They must be specifically
approved in advance by special resolution of the
company’s members.
Official Listing
The name given to the procedure where the Stock
Exchange may grant, following application by a
company, admission of the company’s securities to the
“Official List”, ie the list of securities dealt on its Listed
Market.
Open cheque
An uncrossed cheque. It can be presented for payment
at the counter of the drawee banker, who is protected
under certain conditions in the payment thereof against
forged endorsements by Section 60 of the Bills of
Exchange Act 1882. An open cheque payable to a limited
company can safely be paid without inquiry as to the
presenter’s authority in the absence of suspicious
circumstances, and provided the endorsement, in the
case of an order cheque, purports to be correct.
Ordinary Resolution
A resolution passed at a general meeting requiring a
simple majority.
Ostensible authority
(Also known as apparent authority) The authority which
a third party could expect of an agent with whom he is
dealing.
Ostensible principal
Where the third party is unaware that a principal exists.
Pari passu
Equally
Partnership
An unincorporated business run by two or more
persons. Can also be a limited liability partnership (LLP).
Partnership at will
A partnership which was entered into for a fixed term
but which has continued after the term has expired.
Past consideration
This arises where one party has already performed an
act that represents consideration for a contract before an
agreement to provide consideration takes place. Past
consideration is generally regarded as no consideration
at all. Re. McArdle, 1951 refers to this.
Payment stopped
A customer has the right to give notice to his banker to
stop payment of a cheque which he has issued. The
notice should be in writing, give accurate particulars of
the cheque and be signed by the drawer. If a banker pays
a cheque after a “stop order” has been received, he will
be liable for so doing. A notice should be placed in the
customer’s account in the ledger, so that anyone
referring to the account may at once observe particulars
of the “stop”.
Penalty clause
A clause in a contract that seeks to punish one party for
failure to fulfil the conditions of the contract. These
clauses are often set aside or modified by the courts.
Person
The Bills of Exchange Act 1882 defines a person as including
“a body of persons, whether incorporated or not”.
Personal bar
A doctrine which prevents a person from exercising a
real or personal right when the assertion of that right
would conflict with justice.
Petition
Formal application to court for specific judicial action.
Placing
Occurs where the majority, or often the complete new
issue of securities, is allotted to a small number of large
investors who have been approached privately by the
sponsor without any public offer being made. Also
known as “selective marketing”.
Plaintiff
The person or entity that brings an action in court against
another person or entity. More commonly called the
claimant. The plaintiff or claimant is the first named in
each case.
Positive prescription
Period of time, 5 or 20 years, after which rights are
obtained.
Power of attorney
A formal instrument by which one person authorises
another to perform certain acts for him.
Prescription
Passing of period of time which either confers or
extinguishes rights.
Primary legislation
Acts of Parliament in the UK. Also treaties of the
European Union.
Principal
One who gives instructions to an agent.
Private limited company
A limited company whose shares are privately owned
and cannot be traded.
Pro rata
Proportionally.
Profits
Under Section 263(3), Companies Act, profits available
for distribution are the company’s: “… accumulated,
realised profits, so far as not previously utilised by
distribution or capitalisation, less its accumulated,
realised losses, so far as not previously written off in a
reduction or reorganisation of capital duly made.”
Prospectus
A document inviting the public to invest in shares or
debentures of a public company. The procedure is often
called a flotation. In the case of a listed company the
prospectus must contain the information required by the
Stock Exchange. However, in the case of unlisted
companies, compliance must be made with the Financial
Services Act 1986.
Protest
A protest is the official certificate given by a notary
public respecting the dishonour of a bill of exchange by
non-acceptance or non-payment. When a bill is
dishonoured, a holder may hand it to a notary public to
be protested. The notary presents it again to the drawee
or to the acceptor, and if acceptance or payment is still
not obtained, a note of the facts is made upon the bill, or
upon a slip attached to the bill, which act constitutes a
“noting” of the bill. The official certificate, or protest,
may be extended subsequently, as of the date of the
noting. The bill may be noted on the day of its dishonour,
and must be noted not later than the next succeeding
business day.
Proxy
A person, who is not necessarily a member, appointed
by a company member to attend and vote at a company
meeting. Often directors offer themselves as proxies by
sending out proxy forms with the notice of the meeting.
Public (limited) company
Any limited company with a share capital is a public
company if its Memorandum states that it is a public
company. Its name must end with the words “public
limited company” or “plc”. Any company that is not a
public company is a private company. A company must
be a public company if it is to obtain contributed capital
from anyone other than its founders or persons
introduced individually without advertisement.
Quantum meruit
A common law remedy, literally “what it is worth”. The
principle is often applied where a contract has been part
performed.
Quasi loan
A transaction under which a third party provides goods
or services to a director and is then repaid by the
company, which in turn will receive repayment from the
director.
Quorum
The minimum number of persons who must be present
at a meeting in order for valid business to be transacted.
The required number is usually laid down in the Articles.
Ratification
The subsequent confirmation by a principal of an agent’s
actions when these have been outside the scope of the
agent’s authority.
Reasonableness
Many pieces of legislation permit the courts to set aside
conditions in a contract if they fail a “reasonableness”
test in the eyes of the court.
Receiver
The person appointed to deal with legal remedies of the
creditors of a company that is in default on a debenture
trust deed.
Redeemable shares
Under Section 159 of the Companies Act 1985, a
company may issue redeemable shares if authorised by
its Articles, whether or not those shares be preference
shares or ordinary shares. It is common for redeemable
shares to be made redeemable between certain dates.+xml, */*
Regulated credit agreement
For practical purposes this can be described as an
agreement whereby a creditor provides credit not
exceeding £25,000 to an individual.t
Relief
The right to reimbursement of expenses incurred.
Rescission
The act of an injured party walking away from a contract
– often applied as an equitable remedy.
Restitutio in integrum
A general principle whereby if a party wishes to reduce
a contract, they must restore the other party to the
position that he was in prior to the contract.
Rights issue
A method of raising fresh share capital by a company
from its existing membership rather than from the public
at large. Members are given a right to subscribe for
further shares, usually in proportion to their existing
holding and at a price below the market price. The rights
may be sold (renounced) in favour of a third party.
Salaried partner
A partner who is paid by way of a salary. Unlike general
partners, he is not normally liable for the firm’s debts.
Secondary legislation
Laws that are passes on the basis of authority delegated
by Acts of Parliament. The main examples of secondary
legislation are Statutory Instruments and by-laws.
Service contract
Directors usually prefer a separate contract with the
company rather than relying on the Articles. The
duration of the contract of employment will be stated
along with other particulars including the amount of
remuneration. A contract with a non-executive director
will normally be a contract for the supply of his services
so that he is not then an employee of the company but
an independent contractor.
Shadow directort
Not a formally appointed director, but one who controls
the actions of an actual director. Deemed to bear a director’s
responsibilities under the Companies Act 1985.
Share certificate
A document issued by a company certifying that the
person named therein is a company member and stating
the number of shares registered in his name and the
extent to which they have been paid up. A company can
be personally barred from denying its accuracy./xa
Share premium
The amount by which the price at which a share was
issued exceeds its nominal value. Share premiums must
be credited to the share premium account which is
subject to the rules relating to reduction of capital and
may only be used for certain defined purposes, eg
paying up bonus shares.
Sleeping partner
Similar to a general partner except that he does not take
an active part in the management of the firm.werpoint
Special resolution
A resolution at a general meeting of a company requiring
75% majority. Must be passed for certain actions to be
taken. Must be registered.
Spouse
Husband or wife.
Statute lawwife.
Acts of Parliament and delegated legislation comprise
statute law. These are the superior sources of law in the
UK.
Statutory Instrument
A type of secondary legislation, mainly intended to vary
the provisions of existing Acts of Parliament.werpoint
Statutory meeting
Meeting of creditors in a sequestration called by the
interim trustee within 28 days of the date of
sequestration.
Subscription lists
The lists of persons who have subscribed for shares
following a public flotation. It is always hoped that it
will be possible to “close the subscription lists”
immediately after the time (stated in the prospectus) at
which they are to be opened. Provided the market has
been correctly judged, more than enough applications
will have been made by the public and therefore
applications after that time will be returned to those who
have applied.
Shadow directort
Not a formally appointed director, but one who controls
the actions of an actual director. Deemed to bear a director’s
responsibilities under the Companies Act 1985.
Share certificate
A document issued by a company certifying that the
person named therein is a company member and stating
the number of shares registered in his name and the
extent to which they have been paid up. A company can
be personally barred from denying its accuracy./xa
Share premium
The amount by which the price at which a share was
issued exceeds its nominal value. Share premiums must
be credited to the share premium account which is
subject to the rules relating to reduction of capital and
may only be used for certain defined purposes, eg
paying up bonus shares.
Sleeping partner
Similar to a general partner except that he does not take
an active part in the management of the firm.werpoint
Special resolution
A resolution at a general meeting of a company requiring
75% majority. Must be passed for certain actions to be
taken. Must be registered.
Spouse
Husband or wife.
Statute lawwife.
Acts of Parliament and delegated legislation comprise
statute law. These are the superior sources of law in the
UK.
Shadow directort
Not a formally appointed director, but one who controls
the actions of an actual director. Deemed to bear a director’s
responsibilities under the Companies Act 1985.
Statutory Instrument
A type of secondary legislation, mainly intended to vary
the provisions of existing Acts of Parliament.werpoint
Share certificate
A document issued by a company certifying that the
person named therein is a company member and stating
the number of shares registered in his name and the
extent to which they have been paid up. A company can
be personally barred from denying its accuracy./xa
Statutory meeting
Meeting of creditors in a sequestration called by the
interim trustee within 28 days of the date of
sequestration.
Share premium
The amount by which the price at which a share was
issued exceeds its nominal value. Share premiums must
be credited to the share premium account which is
subject to the rules relating to reduction of capital and
may only be used for certain defined purposes, eg
paying up bonus shares.
Sleeping partner
Similar to a general partner except that he does not take
an active part in the management of the firm.werpoint
Subscription lists
The lists of persons who have subscribed for shares
following a public flotation. It is always hoped that it
will be possible to “close the subscription lists”
immediately after the time (stated in the prospectus) at
which they are to be opened. Provided the market has
been correctly judged, more than enough applications
will have been made by the public and therefore
applications after that time will be returned to those who
have applied.
Special resolution
A resolution at a general meeting of a company requiring
75% majority. Must be passed for certain actions to be
taken. Must be registered.
Spouse
Husband or wife.
Statute lawwife.
Acts of Parliament and delegated legislation comprise
statute law. These are the superior sources of law in the
UK.
Statutory Instrument
A type of secondary legislation, mainly intended to vary
the provisions of existing Acts of Parliament.werpoint
Statutory meeting
Meeting of creditors in a sequestration called by the
interim trustee within 28 days of the date of
sequestration.
Subscription lists
The lists of persons who have subscribed for shares
following a public flotation. It is always hoped that it
will be possible to “close the subscription lists”
immediately after the time (stated in the prospectus) at
which they are to be opened. Provided the market has
been correctly judged, more than enough applications
will have been made by the public and therefore
applications after that time will be returned to those who
have applied.
Supervening illegality
Where a contract is formed, but there is a change in the
law or in the political situation, and this renders
performance illegal.
Supervening impossibility
If the subject matter of the contract, or something that is
essential to the performance of the contract is destroyed,
the contract is frustrated.
Surety
Legal security against loss.
Table A
A model set of Articles of Association. Since 1 July 1985, the form of Table A has been specified in SI 1985 No. 805.
Tacit overdraft
This occurs where a borrower overdraws his or her
current account and the account remains overdrawn for
more than three months with the tacit, or implied, consent of the bank.
Tacit relocation
The legal principal by which a contract which was
entered into for a fixed period but carries on beyond that
date is deemed to continue on the same terms and conditions.
Takeover
The acquisition of shares in a company by another
company.
Title
Legal right to ownership.
Tort
A civil wrong. The most important (for this course) is
negligence.
Transferee for value
Someone to whom a cheque has been transferred
without it being endorsed by the transferor.
True owner
There is no definition of a true owner in the Bills of
Exchange Act, but in the ordinary case where a cheque
is forwarded by the drawer to the payee, the payee is clearly the true owner of the cheque as soon as he
receives it. If he endorses it and negotiates it, the true
owner is the person to whom the cheque has now been
negotiated; that is, the last person in the history of the
cheque who is entitled to enforce payment of it from the
drawer. These cases present no difficulty. It is where
fraud enters into the history of a cheque that the
determination of the true owner may become more
difficult. “Usually he will be the person from whom it
was originally stolen, or obtained by fraud, but not
necessarily so, since if the instrument is in a negotiable
state, as if it is payable to bearer, it may be negotiated
away to a holder in due course, and he is then the true
owner (Smith -v- Union Bank of London, 1875, 1 Q.B.D.
31)”. (Lord Chorley, Gilbart Lectures on Banking, 1953)
Truncation
Removal of the obligation to send cheques back to the
relevant branch of the paying bank.
Uberrimae fidei
Of the utmost good faith.
Ultra vires
Beyond the powers of.
Undisclosed principal
The principal’s identity is not known to the third party
but as long as the agent acts within his authority he does
not incur rights or liabilities.
Undue influence
Psychological or emotional pressure to enter into a
contract.
Unenforceable contract
When due to some statutory, or other rule, a contract
cannot be enforced by action, but it is not so forbidden
as to render it void.
Variation order
Court order used where a missing person who had been
presumed dead by an action of declarator reappears or
if it is later discovered that death was at a different time
other than stated in a decree granted in an action of
declarator.
Vicariously liable
A legal principle which states that an employer is liable
for damage caused to another person by his employee
while the employee was carrying out his work.
Void contract
If a contract is deemed to be void, then this is as if the
contract had never existed in the first place. As a result,
it cannot be enforced and if the purpose of the contract
was to transfer property, then no title to that property
can be given.
Voidable contract
A defective contract which remains in existence until it
is set aside by the party entitled to avoid it.
Warranty
A condition of a contract that is secondary to the main
purpose of the contract. A breach of warranty does not
necessarily mean that the contract has been breached.
Winding up
Synonym for the liquidation procedure by which a
company can be dissolved. May be instigated by
members or creditors (voluntary winding up) or by
order of the court (compulsory winding up). In both of
those cases the procedure involves the appointment of a
liquidator to assume control of the company’s affairs
from the directors. He will collect the assets, pay debts
in a certain order and distribute any surplus funds to
the company’s members according to their rights.