1.1 Separate legal entity that has its own powers
As far as the law is concerned, a company has a separate legal existence that
is distinct from that of its owners, managers, operators, employees and agents.
A company has its own property, its own rights and its own obligations. A
company's money and other assets belong to the company and must be used for
the company's purposes.
A company has the powers of an individual, including the powers to:
·own and dispose of property and other assets
·enter into contracts
·sue and be sued.
Once a company is registered, its separate legal status, property, rights and
liabilities continue until ASIC (Australian Securities and Investments
Commission) deregisters the company.
[sections 119, 124125, 601AA601AD]
1.2 Limited liability of shareholders
Shareholders of a company are not liable (in their capacity as shareholders)
for the company's debts. As shareholders, their only obligation is to pay the
company any amount unpaid on their shares if they are called upon to do so.
However, particularly if a shareholder is also a director, this limitation may
be affected by other laws and the commercial practices discussed in 1.3 and 1.4.
[section 516]
1.1 Separate legal entity that has its own powers
As far as the law is concerned, a company has a separate legal existence that
is distinct from that of its owners, managers, operators, employees and agents.
A company has its own property, its own rights and its own obligations. A
company's money and other assets belong to the company and must be used for
the company's purposes.
A company has the powers of an individual, including the powers to:
·own and dispose of property and other assets
·enter into contracts
·sue and be sued.
Once a company is registered, its separate legal status, property, rights and
liabilities continue until ASIC (Australian Securities and Investments
Commission) deregisters the company.
[sections 119, 124125, 601AA601AD]
1.2 Limited liability of shareholders
Shareholders of a company are not liable (in their capacity as shareholders)
for the company's debts. As shareholders, their only obligation is to pay the
company any amount unpaid on their shares if they are called upon to do so.
However, particularly if a shareholder is also a director, this limitation may
be affected by other laws and the commercial practices discussed in 1.3 and 1.4.
[section 516]
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