I. Company law

ВЫСШАЯ ШКОЛА ЭКОНОМИКИ

Нижегородский филиал

Кафедра иностранных языков

Т.П.Попова

Legal Reading

Учебно-методическое пособие по чтению для студентов 3-го курса факультета права

Часть 1

Нижний Новгород

2007 год

Кафедра иностранных языков

Т.П. ПОПОВА

Legal Reading

Учебно-методическое пособие по чтению для студентов 3-го курса факультета права

Часть 1

Нижний Новгород

2007 год

ББК 81.2 Англ-923

П

Попова, Т.П. Учебно-методическое пособие по чтению для студентов 3-го курса факультета права. Часть 1/Т.П. Попова. – Н. Новгород: НФ ГУ-ВШЭ, 2007.- с.

Учебно-методическое пособие обсуждено на заседании кафедры иностранных языков 26.06.2007, протокол №, и одобрено Учебно-методическим советом НФ ГУ-ВШЭ.

Настоящее учебно-методическое пособие предназначено для студентов второго и третьего курсов факультета права НФ ГУ-ВШЭ, изучающих английский язык в качестве первого иностранного.

Основная цель пособия – обучение различным видам чтения на базе аутентичных текстов юридической направленности, расширение активного и пассивного словаря студентов в области юридической терминологии. Кроме того, преследуется цель развития умения вести дискуссию в процессе совершенствования профессионально-ориентированной устной речи студентов. В процессе работы над предлагаемыми текстами студенты имеют возможность познакомиться с юридическим подъязыком, отражающим различные аспекты британской и американской правовых систем.

Первая часть пособия включает в себя 3 раздела с тремя подразделами в каждом. Первый подраздел (Введение в тему) включает в себя учебные тексты и различные коммуникативные задания к ним (в зависимости от целей чтения); второй подраздел носит название «Проверь свой профессиональный английский» (“Test your professional English”) и включает в себя ряд лексических тестов по пройденной теме. В третьем подразделе помещены аутентичные статьи из английских газет и журнала «Economist» под рубрикой «Газеты пишут» (“Newspapers write”) и задания, направленные на дальнейшее развитие компетенций чтения и говорения на профессиональные темы. Тексты всех трех разделов охватывают основные юридические темы, включенные в программу 3-го курса: Company Law, Contract Law, Family Law.

Учебные материалы пособия могут использоваться на занятиях по практике английского языка и при самостоятельной подготовке студентов.

Рецензент: доцент, к.ф.н. Ненашева Т.А.

© Попова Татьяна Петровна, 2007

© Нижегородский филиал ГУ-ВШЭ, 2007

I. Company law

Reading 1: Introduction to company law

This text provides an introduction to the key terms used when talking about companies as

legal entitities, how they are formed and how they are managed.

1 Read through the text quickly and decide which of these phrases (a–f) best expresses the topic of each paragraph (1–6).

a directors’ duties b management roles

c company definition d company health e partnership definition

e partnership definition f company formation

1 A company¹ is a business association which has the character of a legal person, distinct from its officers and shareholders. This is significant, as it allows the company to own property in its own name, continue perpetually despite changes in ownership, and insulate the owners against personal liability. However, in some instances, for example when the company is used to perpetrate fraud or acts ultra vires, the court may ‘lift² the corporate veil’ and subject the shareholders to personal liability.

2 By contrast, a partnership is a business association which, strictly speaking, is not considered to be a legal entity but, rather, merely an association of owners. However, in order to avoid impractical results, such as the partnership being precluded from owning property in its own name, certain rules of partnership law treat a partnership as if it were a legal entity. Nonetheless, partners are not insulated against personal liability, and the partnership may cease to exist upon a change in ownership, for example, when one of the partners dies.

3 A company is formed upon the issuance of a certificate of incorporation ³ by the appropriate governmental authority. A certificate of incorporation is issued upon the filing of the constitutional documents of the company, together with statutory forms and the payment of a filing fee. The ‘constitution’ of a company consists of two documents. One, the memorandum of association ⁴, states the objects of the company and the details of its authorised capital, otherwise known as the nominal capital. The second document, the articles of association ⁵, contains provisions for the internal management of the company, for example, shareholders annual general meetings ⁶, or AGMs, and extraordinary general meetings ⁷, the board of directors, corporate contracts and loans.

4 The management of a company is carried out by its officers, who include a director, manager and/or company secretary. A director is appointed to carry out and control the day-to-day affairs of the company. The structure, procedures and work of the board of directors, which as a body govern the company, are determined by the company’s articles of association. A manager is delegated supervisory control of the affairs of the company. A manager’s duties to the company are generally more burdensome than those of the employees, who basically owe a duty of confidentiality to the company. Every company must have a company secretary, who cannot also be the sole director of the company. This requirement is not applicable if there is more than one director. A company’s auditors are appointed at general meetings. The auditors do not owe a duty to the company as a legal entity, but, rather, to the shareholders, to whom the auditor’s report is addressed.

5 The duties owed by directors to a company can be classified into two groups. The first is a duty of care and the second is a fiduciary duty. The duty of care requires that the directors must exercise the care of an ordinarily prudent and diligent person under the relevant circumstances. The fiduciary duty stems from the position of trust and responsibility entrusted to directors. This duty has many aspects, but, broadly speaking, a director must act in the best interests of the company and not for any collateral purpose. However, the courts are generally reluctant to interfere, provided the relevant act or omission involves no fraud, illegality or conflict of interest.

6 Finally, a company’s state of health is reflected in its accounts⁸, including its balance sheet and profit-and-loss accoun t⁹. Healthy profits might lead to a bonus¹⁰ or capitalisation issue ¹¹ to the shareholders. On the other hand, continuous losses may result in insolvency and the company going into liquidation.

1. (US) corporation

2. (US) pierce

3. (US) generally no official certificate is issued; companies are

formed by filing the articles of incorporation and the bylaws

(see below)

4. (US) articles of incorporation or certificate of incorporation

5. (US) bylaws

6. (US) annual meetings of the shareholders

7. (US) special meetings of the shareholders

8. (US) financial statements

9. (US) profit-and-loss statement or income statement

10. (US) stock dividend

11. (US) cash dividend

Key terms: Roles in company management

2 Some of the important roles in company management are discussed in Reading 1 above. Which roles are mentioned?