Mercantile Law N5 — Document
November 2020 — N5 — Mercantile Law
N5
2020
Nated Business
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Q1— Section header —
1.10in the ANSWER BOOK.
1.1Choose the incorrect answer Representation is characterised b y the following:
1.2An example of a special power of attorney: A guardian acting on behalf of a minor curator acting on behalf of an insane person Conveyancers registering a mortgage bond
1.3An example of a personal security: Pledge Suretyship A lien Hypothec
1.4Choose the incorrect answer . Assets that do not form part of the insolvent sequestrated estate:
1.5Characteristics of a partnership include: Maximum of 10 persons
1.6Form of delivery for immovable property as contribution by a partner: Constructive delivery Actual delivery
1.7company. state owned
1.8Choose the incorrect answer . Characteristics of a debenture: A form of borrowed capital
1.9The most important document in the case of a lose orporation:
1.10An example of a salvage lien: onstruction of fences on a farm A carrier having a lien on the goods carried by him for transport charges Expenses incurred in order to care for livestock in the absence of the
Q2— Section header —
2.10\i n the ANSWER BOOK.
2.1For a valid lien to exist, actual physical control over the property together with the intention to keep the property for your own advantage are compulsory.
2.2Close orporations may still be established.
2.3Surety ship is not terminated when the principal debt comes to an end.
2.4The benefit of excussion means that the creditor should first take steps against the principal debtor before addressing the surety
2.5A suretyship is a real right.
2.6Partn ers have limited liability. 13030105 Copyright reserved
2.7A pledge is a personal right.
2.8A partnership agreement does not have to be in writing.
2.9A public company may be listed or unlisted.
2.10Companies still have association agreement (10 1\ [10]10
Q3— Section header —
3.10\in the ANSWER BOOK. COLUMN A COLUMN B
3.10Lien Mortgagor Special power of attorney Uberrima fides Judicial pledge Goodwill Dividends Close corporation
Q4— Section header —
4.1Liquidation
4.2An instalment sale transaction
4.3A pledge
4.4A factor
4.510
Q5— Section header —
5.1One of your friends read the above article on i nsolvency, but he is still in the dark. He ask
5.1.1What does it mean to be insolvent? (2\
5.1.2What do you mean when you tal k about ac ts of insolvency? xplain any FIVE acts of insolvency to me
5.1.3What are the differences between compulsor y and voluntary sequestration? resent the differences to me using the table below:
5.1.4Will I be able to continue my job after sequestration ? Please explain this to me. (2\
5.1.5Will all my assets form part of my insolve nt estate? Can you give me THREE examples of assets that will not form part of
5.1.6I hav e a number of creditors. I see they mention payments to preferential cred itors first. I have the following debts:
5.1.7realise that I am in financial trouble, but are there any real advantages to be sequestrated voluntarily
5.1.8he creditors will certainly not allow a voluntary sequestration if they do not also benefit
5.1.9Please explain to me what the consequences of a rehabilitation order will be (3 2\ (6\
5.1.10After how many years will rehabilita tion occur automatically? (1\
5.2Briefly discuss FIVE circumstances in which the membership of members of a close corporation can be terminated. (5 2\
6.1The new Companies Act makes provisio n for FOUR types of companies. List these four types of companies (4\
6.2The article state that the new Act encourages entrepreneurship. Thuli, Neo and Vast i live in the same area. They each
6.3During the process of forming Doe Ltd, Juba entered into a contract with Dijo Ltd on beha lf of Doe Ltd. It is now four months since the company's incorporation and Juba is concerned about the possibility
6.4The article mentions that financial r eporting must take place. List the FIVE financial year end statements
6.5The fact that a company is a legal entity has definite advantages. Discuss THREE such advantages. (3 2\ (6\
6.6Investors can buy either share s or debentures in a company. Draw a table to list any THREE differences between a share and a debenture. (6\
6.7Briefly define the following concepts:
6.7.1The doctrine of constructive notice
6.7.2The ultra vires doctrine
6.7.3
6.8List the THREE most importan t classes of shares. (3\ [50]50
Q7— Section header —
7.1Read the following scenario and answer the questions. Ten years ago, Samantha was sitting in her best friend Rachel s kitchen, and an idea was born for them to start a business together. They would run a wedding planner
7.1.1Is this a valid partnership? Substanti ate your answer by referring to the essentialia of a partnership. Present your answer as follows: Essentialia Motivation from case study (5 2\
7.1.2A partnership is not a legal entity. Briefly discuss any TWO consequences of this fact (2 2\ (4\
7.1.3The article mentions that their partnership soon dissolved. There are various grounds on which a partnership may be dissolved this case
7.1.4Discuss FOUR consequen ces of dissolution. (4 2\ (8\
7.1.5List FOUR duties of both Samantha and Rachel. (4\
7.2SURETYSHI BEWARE!! It can be very dangerous to sign suretyship for someone. First test your knowledge to make sure whether you fully understand this concept
7.2.1Define suretyship. (4\
7.2.2Use an example to explain briefly why it can be dangerou s to sign suretyship. (2\
7.2.3A surety has THREE common law privileges. Briefly discuss the following TWO privileges
7.2.3.1
7.2.3
7.2.4List any FOUR ways in which the principal debt may be terminated (4\ [50]50
Q8— Section header —
8.1List the FOUR characteristics of this representation. (4\
8.2How was this contract of agency established? (1\
8.3Discuss Tsephiso s duty to be honest and to act in good faith. (4 2\ (8\
8.4Suppose A mla Agencies instr ucted Tsephiso not to accept an offer below R1,2 million. The purchaser , however, offer
8.5Discuss the FOUR ways in which a contract of agency may be terminated (4 2\ (8\
8.6Suppose Jarred is the buyer. Jarred took out a mortgage bond to enable him to buy this house.
8.6.1
8.6.2List any NINE ways in which a mortgage bond can be terminated (9\ [5 0] TOTAL SECTION B: 150
Topics Identified
5
Business EnvironmentsForms of OwnershipBusiness FunctionsLeadershipBusiness Plan
Mark Allocation
Total200 marks
Sections20 + 10 + 10 + 10 + 50 + 50 + 50 = 200 marks
Key Information
Websitewww.businessknowhow.com
Paper information
TitleDocument
SubjectMercantile Law
LevelN5
Document typeQuestion paper
Year2020
MonthNovember
Pages12
Downloads5
Examination context
Decade2020s
Years ago6y
SeasonSpring (SH)
Start daySunday
Exam periodNovember 2020
Days since exam2,171
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