Destination of Company Law - Case Study Example

Running Header: Company Law Student’s Name: Instructor’s Name: Course Name & Code: Date of Submission: Company Law These are policies and regulations that govern companies and give directions on how various activities need to be performed. It is aimed at controlling the activities of the organization in line with the public law of a given state. These laws are put in place to ensure that the companies do not go against the policy governing their operations and everything is done in the correct way as illustrated by Leigh (1989). Corporate liability of accompany refers to those liabilities that the company owe people and are supposed to be paid. They may include the outstanding payments, salaries, legal fees and even taxes. In this case, the business is expected to pay all these debts regardless of what they make as profits or losses. The Company is headed by managers and directors who are responsible for their performance. They are the ones who are expected to make sure that company is able to realize profits in order to cover for all its expenses. The company however, provides that the managers and directors of any given company are not liable in any for the liability of it as illustrated by Leigh (1989). This veil by the law can be challenged since it is all concerned on the activities of the directors because they are the ones who determine the liabilities that will be incurred by the business and the various means the company will use to pay for these liabilities. The provisions need to take into consideration the directors activities before giving them any veil to make sure that they are more responsible in managing the company activities. This is because the company can be managed and run in away that are not good and in the process lead to many liabilities. In this way, the law is not supposed to give the directors any omissions from the liabilities incurred by the company since in one way or the other they are the initiators. Yes it is true that the company law at all levels, the veil of incorporation is used to protect individuals and they can not be fully responsible of their various conducts. In reference to the case against Walter Rifkin, the court to my opinion is that, it did not in any way take into consideration the long-term effects caused by Rifkin since he went against the law and took an advantage of his post to do inside trading. This is something that is totally against the will of both the investors and the customers to the company. Rifkin’s case was a subject of thorough investigation to find out whether his actions have been the cause of the present financial problems the company is facing or not. The law is weak in that it only jails someone for nine months and yet that the crime that has been committed can have a long terms effect on the company as illustrated by Wells (2001). A fine that was charged to Mr. Rifkin has no basis because since there is no clear guide on how the fine was reached. Proper investigation need to have been carried out to establish the true effect of Mr. Rifkin in the company presently and many years to come. This is because Rifkin, used her powers to do the inside trading in the name of the company but there was no actual assessment to ascertain how much the company has lost in terms of shareholding and how much him as a person has gained. According to ASIC (2003), it is true that Mr. Rifkin’s went against the law and that is the acknowledgement by the court. However, when the court indicates that it will review his license and that Rifkin may not be allowed to manage the events of a company for only five years is a total abuse to the investors. This is because the person has been found guilty and should never be given any chance by all circumstances to deal with the public resources. This is because if the law was strong enough it could have given judge Whealy the powers to stop permanently Mr. Rifkin from engaging in any activity related to public resources. at the same time, he was supposed to be fined the total cost of damage plus the long term effect the business will incur as a result of mismanagement by those people who cannot be trusted and are totally dishonest to their responsibilities. In our study, we did carry out surveys in various companies to find out various issues pertaining issues concerning the management of public resources and the level to which the managers of various companies were protected by the law against the corporate liability as argued by Gobert & Mugnai (2002). This research gave us the basis to evaluate various sections of the law that deal with corporate liability and how it influences the activities of the managers Conclusion Management of public resources and finances is something that must be handled with a lot of seriousness and care so that protects the interest of the investors and the public economy at large. In the case that has been cited above concerning the inside trading by the company manager is something that can be used as an example to illustrate how weak the law is in protecting the interests of the investors. There is total agency by the government to put in place strong policies that do not compromise with the offenders. It should be a culture that once is found guilty of an offence especially where there is public interest, he must be completely stopped from managing any national resources and on top fined for all the misappropriations alongside lifetime jail imprisonment. This can be done to be a big lesson for those individuals who do not take responsibilities seriously like the case of Mr. Rifkin. Company law is an important tool in ensuring that companies are run in a very responsible manner by avoiding those activities that subject companies into so many liabilities that can not be managed by the company. It aids in punishing the law offenders and protecting the innocent for paying for the expenses that did not cause. References ASIC 2003, 03-170 Rene Rivkin sentenced to jail, viewed 22 April, 2011 from http://www.asic.gov.au/asic/asic.nsf/byheadline/03-170+Rene+Rivkin+sentenced+to+jail?openDocument Gobert, J & Mugnai, E 2002, “Coping with Corporate Criminality – Some Lessons from Italy”, Criminal Law Review, 619. Leigh, L 1989, “The Criminal Liability of Corporations and Other Groups”, Ottawa Law Review, 247. Wells, C 2001, Corporations and Criminal Responsibility, Oxford University Press, Oxford. Read More