Description
QUESTION 1:
Cool Coals (Pty) Ltd operates within a poor community and made three times the usual profit at the end of 2024. The board of directors of Cool Coals (Pty) Ltd debates whether the company should issue university bursaries to learners who have completed grade 12 in 2024 in the community. Some of the directors are opposed to this view. They claim that the company should be managed exclusively in the interests of the shareholders with the result that: (a) the interests of other stakeholders such as the community and its grade 12 learners cannot be taken into account; and (b) all the profits of the company must be distributed to
the shareholders of Cool Coals (Pty) Ltd. As the company secretary, the board of the company approaches you for advice.
With reference to the principle of Ubuntu as expressed by Madala J in the case of S v Makwanyane 1995 (6) BCLR 665 (CC) and the facts in the scenario above, advise the board of Cool Coals (Pty) Ltd on whether the payment of university bursaries may be justified on the basis of the principle of Ubuntu, or whether the profits of the company should be distributed exclusively to its shareholders.
QUESTION 2:
With reference to the relevant case law and appropriate sources, explain the legal consequences of a company’s separate legal personality.
QUESTION 3:
Briefly explain, with reference to the relevant sources, the scope of discretion that a court has in making an order to assist a member whose rights are unfairly and prejudicially affected by a close corporation’s conduct or by the conduct of one or more of the other members of the
close corporation.
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