No reflective loss: The English approach reconsidered

by | Feb 27, 2021 | JCCL, JCCL V6 I2

No reflective loss: The English approach reconsidered

Author: Ataollah Rahmani

ISSN: 2521-2575
Affiliations: Lecturer in Commercial Law, Al-Maktoum College of Higher Education Dundee, Scotland, UK
Source: Journal of Corporate and Commercial Law & Practice, Volume 6 Issue 2, 2020, p. 1 – 48
https://doi.org/10.47348/JCCL/V6/i2a1

Abstract

A company shareholder should have no difficulty in commencing a claim to recover the loss suffered due to a wrong done to their personal property. The right to the protection of property is a fundamental human right in English law. A wronged person whose property right is infringed will have the right to commence legal proceedings against wrongdoers. However, in the company context, the exercise of a shareholder’s right of action may conflict with the company’s right of action where the loss sought is reflective. The English company law’s arrangement has been that a shareholder’s action is exceptional beyond which it will routinely be barred through the principle of the ‘no reflective loss’. Where company’s loss and the shareholders’ loss are reflectively linked, then the company’s action prevails against the shareholder action. This paper argues that the two actions should swap places in law. Shareholder action should be recognised as a general principle of law while it is barred exceptionally in circumstances where stronger policy considerations such as the observation of the corporate autonomy are to be prioritised. This article refers to company law in the UK.

A critical analysis of the competition authorities’ treatment of the element of causation in exclusionary abuse cases

by | Feb 27, 2021 | JCCL, JCCL V6 I2

A critical analysis of the competition authorities’ treatment of the element of causation in exclusionary abuse cases

Author: Sibusiso Radebe

ISSN: 2521-2575
Affiliations: Research Assistant, the Mandela Institute, University of the Witwatersrand, Johannesburg
Source: Journal of Corporate and Commercial Law & Practice, Volume 6 Issue 2, 2020, p. 49 – 81
https://doi.org/10.47348/JCCL/V6/i2a2

Abstract

It is trite law that in order for an impugned act to be condemned in terms of the exclusionary abuse prohibition, entrenched under the Competition Act 89 of 1998, there must be evidence evincing that the said act caused some anti-competitive effect and that the anti-competitive effect caused by the said act outweighs any procompetitive effect caused by it. This position makes the element of causation of central importance in the determination of whether or not to condemn an impugned act in terms of the exclusionary abuse prohibition. However, despite the pivotal role played by causation in the resolution of exclusionary abuse cases, the competition authorities have repeatedly neglected to, inter alia, expound the framework of causation envisaged under the exclusionary abuse prohibition and state the legal principles upon which their conclusions of causation are based. This neglect has caused some competition law commentators to argue that the competition authorities have failed to assess the element of causation in exclusionary abuse cases. This paper examines exclusionary abuse case law through the lens of the common-law framework and tests for assessing causation and demonstrates that, despite the criticism levelled against the competition authorities, first, the authorities do in fact have a framework of causation and tests for assessing causation; secondly, the authorities have been employing the framework referred to above consistently since its first appearance in the case law; and thirdly, the said framework is consistent with the framework of causation envisaged, or apparently envisaged, under the exclusionary abuse prohibition entrenched in the Competition Act 89 of 1998.

The impact of the capacity provisions in the Companies Act 71 of 2008 on the insolvency-remoteness of limited capacity special purpose vehicles used in securitisation schemes

by | Feb 27, 2021 | JCCL, JCCL V6 I2

The impact of the capacity provisions in the Companies Act 71 of 2008 on the insolvency-remoteness of limited capacity special purpose vehicles used in securitisation schemes

Author: Etienne A Olivier

ISSN: 2521-2575
Affiliations: LLD Candidate, University of the Western Cape
Source: Journal of Corporate and Commercial Law & Practice, Volume 6 Issue 2, 2020, p. 82 – 111
https://doi.org/10.47348/JCCL/V6/i2a3

Abstract

The insolvency-remoteness of a special purpose vehicle (SPV) used in a securitisation scheme is of critical importance, because insolvency of the SPV can interrupt the payment streams due to the investors in such schemes. Several contractual methods are implemented to achieve insolvency-remoteness. In this article, it is argued that pacta de non petendo (non-petition clauses), limited recourse provisions, and subordination clauses, all common insolvency-remoteness provisions, do not violate public policy. It is also argued that the capacity provisions in the Companies Act 71 of 2008 (the Act) do not reduce the insolvency risk of a limited capacity SPV used in a securitisation scheme. The fact that ultra vires contracts concluded by limited capacity companies will be provisionally valid under the Act means that provisions in a company’s MOI that limit a company’s capacity will have very little external significance. It is argued that the right to restrain ultra vires contracts in terms of s 20(5) of the Act, in conjunction with the right to ratify such actions in terms of s 20(2), do not provide reliable legal certainty or protection to the investors in assets securitised through a limited capacity SPV.

Coping with the Covid-19 pandemic: A comparative study of the capabilities of the Kenyan and Nigerian insolvency frameworks

by | Feb 27, 2021 | JCCL, JCCL V6 I2

Coping with the Covid-19 pandemic: A comparative study of the capabilities of the Kenyan and Nigerian insolvency frameworks

Authors: Williams C Iheme and Sanford U Mba

ISSN: 2521-2575
Affiliations: Associate Professor of Law, Jindal Global Law School, India; Senior Counsel, ACAS-LAW Firm, Nigeria
Source: Journal of Corporate and Commercial Law & Practice, Volume 6 Issue 2, 2020, p. 112 – 138
https://doi.org/10.47348/JCCL/V6/i2a4

Abstract

The Covid-19 pandemic has undeniably ravaged the global economy and plunged many countries in Africa, including Kenya and Nigeria into an economic recession. This article departs from the premise that credit is the lifeblood of market systems. Accordingly, the credit and insolvency laws of both countries must be adjusted in certain ways during and after the pandemic, in order to enable them to cope with the dire economic challenges resulting from the pandemic. The article identifies some material defects in the Insolvency Act 2015 (Kenya) and the Companies and Allied Matters Act 2020 (Nigeria), and argues that these defects will debilitate a meaningful economic recovery from the pandemic. The paper shows the lack of suitability of their existing insolvency frameworks, as well as some aspects of the public law: it proposes a number of tailor-made recommendations that benefitted from the experiences of certain other common law jurisdictions.

Towards a conceptual framework for local participation in the Zambian power sector

by | Feb 27, 2021 | JCCL, JCCL V6 I2

Towards a conceptual framework for local participation in the Zambian power sector

Author: Lyatitima (Lee) Ernest Mate

ISSN: 2521-2575
Affiliations: Doctoral candidate, University of the Witwatersrand, Johannesburg
Source: Journal of Corporate and Commercial Law & Practice, Volume 6 Issue 2, 2020, p. 139 – 165
https://doi.org/10.47348/JCCL/V6/i2a5

Abstract

None

The conceptual underpinnings of secured transactions and the reform of personal property security laws

by | Feb 27, 2021 | JCCL, JCCL V6 I2

The conceptual underpinnings of secured transactions and the reform of personal property security laws

Author: Gregory Esangbedo

ISSN: 2521-2575
Affiliations: Barrister and Solicitor of the Supreme Court of Nigeria. Principal Partner, Greg Esangbedo & Associates, Lagos, Nigeria
Source: Journal of Corporate and Commercial Law & Practice, Volume 6 Issue 2, 2020, p. 166 – 189
https://doi.org/10.47348/JCCL/V6/i2a6

Abstract

Law reforms typically epitomise the need to effect positive change. The reform of personal property security laws which has attained increased prominence amongst common-law states in recent years is by no means different. However, there appear to be mixed views about the exact impact of these reforms including whether and to what extent they achieve their stated objectives. This article explores the connection between the reforms of personal property security law and the conceptual underpinnings of secured transactions in order to ascertain the extent to which such reforms actually reflect such underpinnings as a preliminary step in evaluating their impact on society.