A company is a voluntary association of persons formed for some common purpose, with capital divisible into parts, known as shares, and with limited liability. It is a creation of law and is sometimes known as an artificial person with a perpetual succession and a common seal.
Characteristics of a Company are as follows :
1.Separate legal entity:
A company is regarded as an entity separate from its members. The member of the company is in no way debarred from entering into contracts with the company .a member of the company cannot be held liable for the acts of the company even if he holds virtually the entire share capital. The company and not to the shareholders (although the shareholders own the company )
2. Limited liability.
A company may be a company limited by shares or a company limited by guarantee. In a company limited by shares, the liability of members is limited to the unpaid value of the shares. In a company limited by guarantee, the liability of members is limited to such amount as the members may undertake to contribute the assets of the company, in the event of its being wound up.
3.Perpetual succession and a common seal:
A company is a juristic person with a perpetual succession and a common seal. Its life does not depend on the life of its members. It is created by a process of law and can be put an end to only by a process of law.it continue to exist even if all its human members are dead .if during the war all the members of a company, while in general meeting, are killed by a bomb, the company would survive; not even a hydrogen bomb can destroy it
Since a company has no physical existence, it must act through its agents and all such contracts entered into by its agents must be under seal of the company
3. Transferability of shares. The capital of a company is divided into parts, called shares. These shares are, subject to the certain condition, freely transferable .sec 82 enunciates this principle by providing “that the shares or other interest of any member shall be movable property transferable in the manner provided for in the articles of the company”.
4. Separate property.
A company as already observed, is a legal person distinct from its members, it is, therefore, capable of owning, enjoying and disposing of property in its own name .although the capital and assets of the company are contributed by its shareholder ,they are not the private and joint owners of the property of the company .the company is the real person in which all its property is vested ,and by which it is controlled ,managed and disposed of
5. Capacity of sue:
a company can sue and be sued in the corporate name
Characteristics of a Company are as follows :
1.Separate legal entity:
A company is regarded as an entity separate from its members. The member of the company is in no way debarred from entering into contracts with the company .a member of the company cannot be held liable for the acts of the company even if he holds virtually the entire share capital. The company and not to the shareholders (although the shareholders own the company )
2. Limited liability.
A company may be a company limited by shares or a company limited by guarantee. In a company limited by shares, the liability of members is limited to the unpaid value of the shares. In a company limited by guarantee, the liability of members is limited to such amount as the members may undertake to contribute the assets of the company, in the event of its being wound up.
3.Perpetual succession and a common seal:
A company is a juristic person with a perpetual succession and a common seal. Its life does not depend on the life of its members. It is created by a process of law and can be put an end to only by a process of law.it continue to exist even if all its human members are dead .if during the war all the members of a company, while in general meeting, are killed by a bomb, the company would survive; not even a hydrogen bomb can destroy it
Since a company has no physical existence, it must act through its agents and all such contracts entered into by its agents must be under seal of the company
3. Transferability of shares. The capital of a company is divided into parts, called shares. These shares are, subject to the certain condition, freely transferable .sec 82 enunciates this principle by providing “that the shares or other interest of any member shall be movable property transferable in the manner provided for in the articles of the company”.
4. Separate property.
A company as already observed, is a legal person distinct from its members, it is, therefore, capable of owning, enjoying and disposing of property in its own name .although the capital and assets of the company are contributed by its shareholder ,they are not the private and joint owners of the property of the company .the company is the real person in which all its property is vested ,and by which it is controlled ,managed and disposed of
5. Capacity of sue:
a company can sue and be sued in the corporate name