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CSEET · Business Laws and Management · Elements of Company Law

Consider these statements about the effect of the memorandum and articles. I. When registered, they bind the company and its members as if each had signed them and agreed to observe all their provisions. II. Money payable by a member to the company under the articles is a debt due from him to the company. III. A provision in the articles that is repugnant to the Act remains valid if all members agreed to it. Which statements are correct?

Only statements I and II are correct. Registered documents bind the company and members as if signed by each, and sums payable by a member are a debt due to the company. A provision repugnant to the Act is void, even if members agreed.

  1. AI and II onlyCorrect
  2. BII and III only
  3. CI and III only
  4. DI, II and III

Explanation

Section 10 makes statements I and II correct. Statement III is wrong because under Section 6 any provision in the memorandum or articles repugnant to the Act becomes void, and the Act overrides the articles whatever the members agree.

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