The Language of Business Law 7B

Incorporated businesses

Unincorporated businesses

'We set up our business together two years ago. I'm an accountant and Mark is a builder. We trade under the name of MH Property Services. Mark does all the building work while I deal with all the paperwork. Mark and I share all the profits. We didn't have to register the business anywhere, but we joined the local small builders' association. We took out a loan from the bank when we set up, to buy a van and any tools that Mark needed. The bank insisted on securing the loan on our house, but as we were confident about the future of the business, we decided to take this risk. We're doing quite well at the moment.’

'I own shares in Express Enterprises, which I bought two years ago through a stockbroker. Express Enterprises has just announced that it has made record profits this year. It has declared a dividend, which provides an excellent return on my investment. This dividend is to be distributed soon. All of the shareholders will be delighted that the price of shares has risen by 21 pence each since this announcement was made. Stockbrokers are reporting that a lot of people are interested in buying Express Enterprises's shares.'

'I own a specialist business consultancy firm. I have office premises in Birmingham and I employ two full-time employees. I have just completed the annual return for the last year of trading, providing details of the capital, the shareholders, address of the registered office and other information. My accountant is preparing the annual financial accounts. Business fluctuated last year, but I am optimistic that it will grow and provide a steady income.'

 'The four of us set up our accountancy business about 18 months ago. After considering the options, we decided on this type of business structure. Most new professional services are using this structure. There is less risk involved as we are only liable for the amount of money we contributed to the business. Tax was another consideration. We didn't want to pay corporation tax which is generally at a higher rate, so we opted for this. We each have to pay income tax on our share of the business profits.'

'I am a maths teacher. I used to work in a big school, but decided that I wanted to do private tutoring, specialising in helping children who find it difficult to understand maths. The business is very successful and I have a waiting list of parents who are interested in their children having lessons with me. I don't want a big business, I'm happy just doing the hours I want. I can be as flexible as I want. If I need more money, I just accept extra pupils. The business is easy to run and I'm not restricted by rules and regulations.'

To … a business (założyć)

To … a risk

To make … profits

To … a dividend (ogłosić)

To … a dividend (wypłacić)

A … on investment

Business …

To … an option

To … a loan

To trade … a name

To insist … something

To be confident … something

To own shares … a company

To be interested … doing something

A return … investment

To decide … something

To opt … something

To be restricted … something

It is very easy to start the business and you can begin to trade immediately. The owner does not need to register with anyone other than HM Customs & Excise, which is the government department in the UK that collects tax.

The owner is completely responsible for the business. If the business fails, the owner is fully responsible for all the business debts. This is called unlimited liability.

If the business does well and makes money, that money belongs to the owner. But if the business does badly, the owner bears all the losses.

The owner runs the business himself or herself and does not have a boss. You can pay other people to work for you if you start to get busy, but you will remain the boss.

You must register with HM Customs & Excise within three months of starting the business. If you make a profit you will have to pay part of it to the government.

The owner's word is final. The owner has full control over how he or she runs the business.

The owner uses his or her personal money, or borrows from friends or relatives. Banks can be reluctant to offer a loan to a new sole trader. You need a good business plan and the bank will want security over your personal assets to make sure you repay the loan.

To … a profit

To … a loss

… assets

… liability

To … a business

To … a loan

To … money

To … control

To register … someone

To be responsible … something

To do something … a period of time

To have security … assets

To borrow something … someone

To belong … someone

To have control … something

‘ I considered all the advantages and disadvantages when I … my business and in the end I opted (b) to a type of business in which I am called a sole trader. It is easy to … and you don't need to register … anyone except the tax authorities. As I am the sole owner, I am entitled … all the profits that the business …, but if things go wrong, I … all the losses. I have … liability for the debts of the business, which means that my … assets are at risk if I can't pay my creditors. I borrowed some money … the bank, and they now have security … my house."

To … … business

A legal …

To … a decision

To … a debt

To … payment

To … a dispute (rozwiązać)

To … a dispute (rozstrzygnąć)

To … a partnership (rozwiązać)

To … bankrupt

According … something

To consist … something

If two or more people wish to go into business together, a partnership offers a simple way to do so. Partners share the control, responsibility and finances of the business. You do not need to … your partnership, except with the tax authorities. A partnership is not a … It does not have its own legal personality. As a result, each partner is usually regarded as being ... Each partner will pay income tax on their share of the … of the partnership.

A partnership often just consists of general partners. All of these partners have the authority to make decisions about the business. They share all the profits and have … liability for any debts incurred by the business. This means that if the partnership does not pay what it owes to someone, that … may demand payment from one or more of the partners. The partners' personal … are said to be 'at risk'.

It is possible to have other types of partner. An … partner contributes capital to the partnership and receives a share of the partnership profits in proportion to the amount of capital he or she has invested. These partners are involved in all decision-making. Another type of partner is a … partner, who receives high remuneration for his or her services, but does not receive a share of the profits of the partnership. Finally, some people may contribute money to the partnership but they do not involve themselves in the day-to-cay control of the business. They are often called … partners or dormant partners.

There is no legal obligation to have a partnership agreement although this is recommended. It will help to avoid or resolve any disputes which may arise. If there is no partnership agreement, the dispute will be settled according to the Partnership Act 1890. However, the Partnership Act may provide a solution that the partners do not like. Also, if there is no partnership agreement, the partnership must be … ceases to be a partner, for example if he or she dies, … Again, this is probably not what the partners would like to happen. instantly if a partner or goes bankrupt.

Relevant, particular, the one thing in a group of things that refers to or belongs to a particular person.

A document containing extra information that is attached to a contract.

Attached.

Circumstances or situation.

At all.

The specifications for the building work that your client will carry out are contained in the … attached to this contract.

The company will not pay any additional expenses … so you should be very careful not to spend more than the money that you have been given.

… to this draft contract is the list of assets that you are purchasing.

What is the full … of the dispute between the partners? I only have one person's story so I do not know the exact circumstances.

After the meeting both of the lawyers retumed to their offices to discuss the new developments in the case with their … clients.

The 'Partners' means all the individuals who are parties … at the date … and shall include, from the … dates upon which any other individuals by the addition of their names and addresses to the schedule … hereto such other individual or individuals, and shall unless the context otherwise requires exclude any such individual being a … business who shall have ceased for … partner of the reason to be a partner …

Formal communication or warning that something is about to happen.

A situation where someone leaves a business partnership because the other partners force him or her to go.

To end or to terminate. This word also has another meaning in legal English, which is to 'decide'. When you see this word in an agreement you must be careful to be sure of which meaning the lawyer is using.

A word to describe the situation where someone stops working because he or she has reached a certain age. In many countries this is the age of 65.

The terms and conditions contained in a contract.

A formal way of saying 'because of'.

The situation where a partnership has been brought to an end so that it no longer exists.

A formal word meaning the start or the beginning of something.

A formal word meaning 'stops'.

The situation where someone leaves his or her job voluntarily. That person stops working by telling the employer, usually by letter, that he or she is leaving.

 formal way of saying 'considering what is written in' or 'except as stated in'. These words also have another meaning in legal English, which is 'depending on'. When you see these words in an agreement you must be careful to be sure of which meaning the lawyer is using.

A period of time. It has a definite beginning and a definite end.

Most of the people or things in a particular group. More than half of any particular group.

The remaining partners. The people who continue to be partners after one of the partners dies or leaves the partnership for any other reason.

Rates, usually expressed as a percentage

Decided

To have the right to something

To take money from an account

Aggregate

Giving

All have any gains

Responsible

Amounts of money that the partnership owes

Take 500$ a month

Time for leaving the partnership for ane reasons is 60

Forcing a partner to go out of the partnership

Finishthe partnership

These are businesses which have been formally set up and registered as companies.

This is something that exists in the eyes of the law. It is a legal 'being', and can be a person or a company.

This means 'to make public', to tell someone, or to reveal.

This is another name for the shareholders of the company.

This means that the shareholders will not lose more than their investment in the company. They will have to pay any amount that they still owe to the company for their shares, but no more.

This is the name of the tax that a company has to pay.

This is the name of the tax that individuals must pay when they earn money.

These are the people who are responsible for the day-to-day management and running of the company.

This is a payment of a company's profits to the shareholders of the company.

TThis is the person who must make sure that all the statutory regulations regarding a company are followed.

This is a company that has just one shareholder.

This is the amount of money that represents the value of a company's shares.

To … information

To … shares (emisja)

To … a company (wymienić)

To have the agreement … someone

To do something … someone

To file a document … a place

To end … something

… director

Limited …

Legal …

Debts …

…-…-… company

… a company

… sets out the company's name, where the … of the company is situated and what it will do, in other words, the purpose of the company.

Purpose of the company

The (… set out the rules for the running of the company's internal affairs. The articles must be signed by the ...

Form 12 is a statutory declaration of … with all the legal requirements relating to the incorporation of a company.

To protect someone … something

To have a number … something

The object … something

To have … least a number

To make something available … someone

To submit something … someone

The Members shall complete and deliver …Companies House all such documents and pay all such fees as shall be necessary to lead to the incorporation … the LLP … Partnerships Act 2000. accordance … the Limited Liability

The certificate of registration of the LLP issued … Partnerships Act 2000 shall be kept … the Limited Liability the Registered Office.

If

Decide

Good

Start to operate

Before

Officially approve

Continue to exist

Pay for any damage suffered

Permission

The provisions of this Agreement shall … on the Commencement Date.

The LLP shall carry on the Business and/or carry on such other or additional trade profession or business as the Members shall from time to time …

The LLP shall … until wound up in accordance with the provisions of the Limited Liability Partnerships Act 2000.

… any Member may be personally liable under any contract entered into by him … to the incorporation of the LLP which was for the … of the LLP and with the express or implied … of the other Members then the LLP shall on incorporation be deemed to … that contract and shall … that Member from and against all claims, liabilities and costs in connection with it.

I've … all the options available to me and decided to go ahead and start the business.

The shareholders were pleased when Gernee pic … a dividend, as last year they received nothing.

Harrow & Trot plc has just announced that although business … following the changes in interest rates, annual profits were up by 11% last year.

If the business does badly, I may lose my house as I have … liability for all of the debts of the business.

We will not … information about you to any third parties without your permission

If you do not have a partnership agreement, any disputes will be … according to a statute from 1890.

I wasn't able to pay my creditors and had no choice but to … bankrupt.

The company … shares to three new members.

I've always wanted to own a business, but was a bit worried about it. Two years ago I decided to …a risk and start a nursing agency. I'm pleased to say it's doing well.

We had a fantastic year last year we made … profits.

We are afraid that your behaviour gives us no choice other than to … you from the partnership.

I have decided to … all my money in a new company called TenBase plc.

When a new company is set up, it receives a … of incorporation from Companies House.

The authorised share capital is £100,000 divided into 100,000 shares with a … value of £1 each.

Partners have joint and … liability for the partnership debts.

Their solicitor advised them on the procedure that it is necessary to follow in order to … a new company.

Another expression meaning a legal person is a legal …

Each partner is allowed to take out some money from the partnership account each month for his or her personal use. This is called his or her …

The first shareholders of a company are called the …

In its memorandum of association, every company has an … clause, which states the purpose of the company.

I want to be a company lawyer as I am very interested … commercial and business law.

We are a limited liability partnership, which operates like a company but is taxed … a partnership.

You must submit an annual return and accounts … Companies House every year.

Our business name appears … the list of reputable estate agents.

We are a small business, consisting … four full-time employees and two part-time employees.

You must have … least £50,000 share capital to start a public limited company.

The object … this exercise is to make sure that you can remember the correct prepositions

According …  the partnership agreement, each partner is entitled to drawings of £500 each month

I authorise you to make this information available … Mr Richard Jard.

The bank is willing to lend us some money, but it is insisting … a personal guarantee from each of us.

… to the following … of this clause the Partners shall … the profit for each Partnership Year and … any loss for any Partnership Year in the proportions specified opposite their names in column 2 of Schedule 1 hereto.

There shall be paid in each year by way of gross … salaries which shall be … deemed to accrue from day to day and shall be paid … such sums (if any) as are set out opposite the Partners' respective names in the Schedule 2 hereto.

There shall be paid to each Member … the Payment Date … each Month the Drawings or such other sum as the Members may … time to time agree … respect either of all Members or such Members as may thus be determined.

Any further payments to be made to or on behalf of any Member and any assets to be transferred to or … the benefit of any Member shall only be made, transferred or applied … the consent of the Members.

There are several different types of company in England, but the most common are the private limited company and the … limited company. The name of a private limited company must end with 'Itd' or 'limited' and a public limited company's name must end with 'plc', so you will always know what type of company it is just by looking at its name. A company is an … business. This means that it has its own separate legal personality. Lawyers call it a legal … Both types of company must be registered at Companies House. That is the central registry of companies. There are over 2.3 million registered companies in the UK. Every company has its own file at Companies House and anyone can look at the file to find out information about the company. You may like to visit the website of Companies House for more information. The web address is www.companieshouse.gov.uk.

The 'owners' of a company are called the … or the shareholders. This means that they own shares in that company. A share is a part of the company's capital. A private company cannot offer shares in the company to members of the public, but a public limited company can do this.

A private limited company can have any number of shareholders. It is very common to have a private limited company with just one shareholder. In this case, the company is called a … -member company. A public limited company must have a … of two shareholders, but usually has a lot more. Another big difference between the two types of company is the amount of share capital that the companies must have in order to incorporate and register them. Someone may register a private limited company with a very small amount of share capital, maybe only £1, but in order to register a public limited company it must have a substantial amount of share capital. This amount varies, but at the moment it is £50,000. The shareholders of a company have … liability, in other words they will not lose any more than they paid for their shares.

When someone wants to incorporate a new company they must … certain documents at Companies House. There are two very important documents that every company has. These are the … of association and the articles of association. The first document sets out the essential information about the company, including the company's name, the situation of the registered office and what the company will do, known as the objects of the company. The registered office is the place to which people will send all official letters and legal notices. The articles of association set out the internal … of the company.

There are a lot of statutory regulations that a company must … with. The most recent legislation that governs companies in England and Wales is called the Companies Act 2006.