ADMN 3250H Chapter Notes - Chapter 17: Issued Shares, Sole Proprietorship
30 Jun 2018
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Chapter 17
How does a corporation differ from a sole proprietorship or a partnership?
Corporation – a type of legal entity created by the state
Has an existence at law, but no material existence
Separate and distinct from its shareholders
Properly authorized agent may bind the corporation in contract with third
parties
Shareholders of corporation possess limited liability for the debts of
corporation, and creditors may look only to assets of the corporation to
satisfy their claims
What are the various methods of incorporation?
Royal Charter:
oWas original method, hasn’t been used for many years now
oUsed for purpose of creating a legal existence for the entity, to permit
it to either operate as a monopoly or to own land
Letters Patent:
oA government document that creates a corporation as a legal entity
Special-Act:
oA corporation created by an Act of Parliament or a legislature for a
specific purpose
oEx. Banks, railroads, telephone companies, etc.
General-Act:
oA form of incorporation whereby a corporation may be created by
filing specific information required by the statute
oIncorporation documents used are Memorandum of Association or
Articles of Incorporation
What is the difference between federal and provincial incorporation?
Federal incorporation gives your business increased business name
protection and wider rights to carry on a business
Federal incorporation of your business means that you will be able
to do business all across Canada under the same business name,
even if some other company is already using a similar name in some
province or territory
When you incorporate your business in a particular province or
territory, you are only entitled to operate your business in that
jurisdiction and have no name protection outside that province or
territory.
What is the incorporation process?
Begins with preparation of an application for incorporation that sets out the
name of proposed corporation, address of head office and principal place of
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Document Summary
Corporation a type of legal entity created by the state. Has an existence at law, but no material existence. Properly authorized agent may bind the corporation in contract with third parties. Shareholders of corporation possess limited liability for the debts of corporation, and creditors may look only to assets of the corporation to satisfy their claims. Royal charter: was original method, hasn"t been used for many years now, used for purpose of creating a legal existence for the entity, to permit it to either operate as a monopoly or to own land. Letters patent: a government document that creates a corporation as a legal entity. Special-act: a corporation created by an act of parliament or a legislature for a specific purpose, ex. General-act: a form of incorporation whereby a corporation may be created by filing specific information required by the statute, incorporation documents used are memorandum of association or.
