KOLEJ PROFESSIONAL MARA AYER MOLEK
COMPANY
LAW (LAW 2513)
TUTORIAL
12 – WINDING UP
1. The
process by which all the company’s assets are collected, its debts paid and the
surplus ,if any , distributed among its members is known as
A. liquidation
B. petition
C. frustration
D. registration
2.
Which of the following statements is NOT the legal effect of the court’s
order for compulsory
winding up?
A.
The winding up shall be
deemed to have commenced when the petition for winding up was presented in the
court
B.
Employees are automatically
dismissed but the liquidator may, nevertheless, continue to employ all or some
of them if he continues the company’s business
C.
Seizure of the company’s
assets after the liquidation is valid
D.
When the winding up order has been made and
the liquidator has been appointed, no action shall be taken against the
company, except by leave of the court
3. The declaration of solvency shall be attached
with the statement of affairs of the company in the prescribed form which
include;
I the assets of the company
II. the total amount expected to be realized
from the assets
III.
the liability of the
company
IV.
the estimated expenses of
winding up
A.
I, II, and III
B.
II, III and IV
C.
I, II and IV
D.
I, II, III and IV
4. Which of the situations below can make a
company to be wound up by the court?
A. A number of members is reduced below 2
B. A
company has no profit
C. All
the shareholders in the company are died
D. A
company has conflict with its subsidiaries
5.
The court has a power to wind up a
company on the following ground…
A. the
company’s director make a written declaration of solvency to the company
B. the number
of member is reduced below two
C. the
company’s member passes special resolution to wind up a company
D. the member
in general meeting appoint a liquidator
6. The
court will make a winding up order on just and equitable ground in the
following situations except:
A.
Reconciliation among company’s members is possible
B.
Fraud
C.
Breakdown of mutual trust and confidence
D.
Deadlock
7. ‘Compulsory
winding up’ of a company is also called winding up by .
A. members of the company
B. order of court
C. shareholders
D. company’s secretary
8. The court will make a winding up order on
just and equitable ground in the following situations except:
A.
reconciliation among
company’s members is possible
B.
fraud
C.
breakdown of mutual trust
and confidence
D.
deadlock
9. For
compulsory winding up of a company, if members or creditors appoint different
people as a liquidator,
A. the members choice would prevail.
B. the creditors choice would prevail.
C. the court will appoint a new liquidator.
D. liquidator appointed by both members and
creditors is not valid.
10. A members’ voluntary winding up can only be
proceeded as such if the company is,
A. insolvent.
B. solvent.
C.
unable to pay its debts within 12 months after the commencement of
winding up.
D.
able to pay its debts with 24 months after the commencement of winding
up.
11. “Compulsory
winding up” of a company is also called winding up by,
A. members of the company
B. order of court
C. shareholders
D. company’s secretary
12. “Creditors’
voluntary winding up” may arise in a situation where,
A. there is a proposal to wind up the
company voluntarily but the directors do not make and lodge a declaration of
solvency.
B. there is a winding up initiated by the
creditors.
C. there is a proposal to wind up the
company voluntarily and the directors make and lodge a declaration of solvency.
D. there is a winding up initiated by the
court.
13.
Below
are the characteristics of creditor’s voluntary winding up, EXCEPT:
A.
Initiated
by special resolution passed by members in general meeting.
B.
Declaration of solvency made by company’s
Board of Directors.
C.
Creditors are called to attend creditor’s
meeting.
D.
Appointment of liquidator by creditors at
the creditor’s meeting.
14. Among the persons permitted to apply for winding up order under
section 217 Companies Act 1965 are ____________.
I.
The Registrar.
II. The debtor of the company.
III.
The creditor of the
company.
A. I and II.
B. I and III.
C. II and III.
D. I, II and III.
14.
Jutaria Sdn. Bhd. is a
company with 2 shareholders, Roy and Fred. Both held equal shares of 50% and
controlled the company together. Recently, it comes to Roy knowledge that Fred
has made sexual advance towards Roy’s wife. Roy was frustrated and no longer
wants to continue with the company but Fred refused. Roy wants to make an
application for court ordered winding
up.
What would be the best ground for Roy in his
application to court?
A.
Breakdown
of trust.
B.
Deadlock.
C.
Misconduct
and oppression.
D.
Failure
of substratum.
SECTION B
Question 1
With
regard to the winding up of a company, explain the following:
(a)
Types of winding up of a
company [
4 marks]
(b)
Winding up on just and
equitable ground [
8 marks]
(c)
Four grounds of compulsory
winding up [
8 marks]
[Total
: 20 marks]
Question 2
(a) Explain
the following situations where the court will make a winding up order on just
and equitable ground under s. 218 (1)(i) of Companies Act 1965. Support your
answer with relevant decided cases.
i)
Breakdown of mutual trust and confidence [4 marks]
ii)
Deadlock
[4 marks]
(b) Meena
and Kajol are the only directors and shareholders of Ketambola Sdn Bhd. They
have a serious disagreement and there was no chance of reconciliation. As a result,
the company is unable to function properly.
Advise
Melly on what is possible ground to wind up the company.
[12
marks]
[Total : 20 marks]
Question 3
a) Briefly
explain three (3) grounds for
compulsory winding up.
[7 marks]
b) “Winding
up or liquidation…entails the collection of the company’s assets, payments of
its debts and distribution of the surplus, if any, to the members. It is only
on completion of this process that the company would be dissolved and ceases to
exist.” Krishnan Arjunan, Company Law in Malaysia, Cases and Commentary, 1998
at p. 614.
With regard to the above statement, explain four
(4) situations where the court would order winding up on just and
equitable grounds.
[8 marks]
[Total : 15
marks]
