Twinkie, Lala and Dipsy are siblings. In order to secure the future of his brothers, Twinkie formed a company and carried out their family business.
law
Description
QUESTION
E
Twinkie,
Lala and Dipsy are siblings. In order to secure the future of his brothers,
Twinkie formed a company and carried out their family business. All three of
them became members and directors of the company. Prior to the company’s
incorporation, Twinkie ordered office furniture from Lulu. The furniture was
later delivered to the company and Lulu claimed for payment. Lala and Dipsy
refused to accept the delivery and asked Lulu to take back her furniture. Lulu
was furious and insisted that the company is liable for payment.
At
the beginning of the company’s business, Twinkie advanced an amount of
RM25,000.00 to cover all the administration expenses of the company. After
several years, the company’s business grew rapidly. Twinkie wished to have his
money back. Lala and Dipsy declined his request. According to them, the company
is technically Twinkie’s since he holds 85% of the total issued shares in the
company.
On
28th. August 2019, a resolution was passed to alter the company’s constitution
in respect of signatories on the company’s cheque and account. Formerly, the
constitution stated that, “any withdrawal of money from the company’s account
which exceeds the amount of RM10,000.00, shall requires signature from THREE
directors”. Under the alteration, only
TWO directors need to sign and authorise the transaction. The resolution
further stated that the alteration shall take effect THIRTY days from the date
of the resolution. On 18th. September 2019, the company’s cheque for an amount
of RM15,000.00 was issued to Poh. The cheque was signed by Lala and Dipsy.
Analyse
the above scenario based on the Companies Act 2016 and relevant decided
cases.
