These questions have been prepared by students of BUSL301 Session 3 2012-2013.

Note – I have not checked or altered them - some aren’t very clear – some may be wrong - there are spelling errors etc. Nonetheless they are still practice (but remember students don’t prepare the midsession test – I do) The ANSWERS provided by students are at the end of the questions Try the questions then look at the suggested answers

1. Which of the following statements is most accurate? a) Shares are always transferable, while debts are not. b) Shares and debts are both generally transferable. c) Neither shares nor debts are transferable. d) Shares are generally transferable, but directors of proprietary companies can refuse transfer registration for any reason.

2. Tom entered into a contract with Cookie limited; a public company selling cookies of all flavors, to sell them 2000 kg of sugar. Tom met up with one of the directors named Mark to arrange and sign this contract. Tom also ensured he was a director of the company becasue he had looked it up on the ASIC records, so he felt confident the contract would not fall through. He is then later informed by the company that Mark acted without the consent of the other directors and was not allowed to enter into the agreement with him, so the company will not pay for the goods. Is Cookies limited obligated to pay Tom? a, yes, under section 128 an outsider is entitled to make assumptions in Section 129 in relation to dealing with a company. Tom assumed that Mark was an agent for the company;his name recorded on ASIC records as a director b, yes, under section 117 an outsider is entitled to make assumptions in Section 118 in relation to dealing with a company. Tom assumed that Mark was an agent for the company; vicarious liabilty shows he is a director c, yes, under section 128 an outsider is entitled to make assumptions in Section