ICAB PL Corporate Laws and Practices common mistakes
ICAB PL Corporate Laws and Practices · Understand the traps and how to avoid them.
Answering a Companies Act provision question from general memory of the section's gist instead of stating the statutory threshold, the procedural step and the consequence in the order the Act sets them out.
Candidates revise by reading summaries and treat the Act as background reading, so they can recognise a provision but cannot reproduce its operative elements under timed conditions.
What to do instead
Build a one-page table for each frequently examined provision (incorporation, share allotment, dividends, board meetings, audit, winding up) with columns for threshold, authority, timeline, filing and penalty, and self-test by writing the table from memory before checking it.
Confusing the roles, appointment routes and removal procedures of directors, managing directors and managers, and answering as if all directors are appointed and removed the same way.
The Act and the articles treat these offices differently, but candidates learn them as a single 'directors' topic and rely on a vague memory of board control.
What to do instead
Draw a comparison grid for each office covering who appoints, eligibility and share qualification, tenure, grounds for vacation, removal method and filing requirement, then practise scenario questions where the facts point to one office only.
Treating the memorandum and articles as interchangeable, and failing to identify which document governs a disputed matter or which alteration procedure applies.
Both are constitutional documents and are studied together, so candidates memorise the definitions but not the boundary between them or the special resolution requirements for altering each.
What to do instead
For each clause type (objects, capital, liability, internal management), note whether it belongs in the memorandum or articles, the alteration procedure, and the effect on existing members; then work through short fact patterns requiring classification.
Mixing up the shareholder approval thresholds, so ordinary, special and unanimous resolution questions are answered with the wrong majority or the wrong meeting notice.
Percentages and notice periods are learned as isolated numbers without being tied to the specific decisions they govern.
What to do instead
Create a decision-to-threshold map (for example share capital changes, director removal, constitutional alteration, winding up) and drill it with questions that supply a voting outcome and ask whether the resolution is valid.
Ignoring the procedural sequence in meeting and resolution questions and jumping to the outcome, so defects in notice, quorum, agenda or proxy handling go unspotted.
Candidates focus on the substantive decision and treat procedure as routine, missing that most exam scenarios plant a procedural defect as the real issue.
What to do instead
Adopt a fixed checklist for every meeting question (authority to call, notice and contents, quorum, voting and proxies, conflict of interest, minutes and filing) and answer by walking through it in order before concluding.
Describing corporate governance compliance in general terms rather than linking it to the specific statutory duty, the reporting obligation and the enforcement consequence.
Governance is often revised from commentary and codes rather than the Act and regulatory directions, so the answer sounds plausible but lacks the legal anchor.
What to do instead
For each governance topic (board composition, audit committee, related party dealings, disclosure), write the duty, the responsible officer, the report or filing, and the sanction, then practise converting each into a three-sentence exam answer.
Answering secretarial filing and record-keeping questions without stating the form, the authority receiving it and the deadline, or assuming a filing is optional because no one objects.
Filing requirements are scattered across the Act, rules and regulator directions, and candidates rely on impression rather than a consolidated calendar.
What to do instead
Maintain a filing calendar listing event, prescribed form, recipient, deadline and late-filing consequence, and rehearse it with date-based questions that require computing the deadline from the event.
Failing to identify the correct forum and remedy, so disputes over company decisions are answered with the wrong authority or with a general plea for justice.
Remedies are taught late and in isolation, so candidates know a remedy exists but cannot match the grievance to the forum, standing and time limit.
What to do instead
Build a grievance-to-remedy table covering internal complaint, regulatory reference, court application and arbitration, including who has standing and the limitation period, and practise classifying short scenarios.
Writing unstructured essay answers that narrate the facts back and bury the legal issue, so the examiner cannot locate the provision applied or the conclusion reached.
Under time pressure candidates write everything they remember about the topic instead of answering the question asked, and they have not practised planning before writing.
What to do instead
Use a fixed answer skeleton (issue, provision, application to facts, conclusion), spend the first two minutes drafting that skeleton, and practise past-style questions under timed conditions with the skeleton enforced.
Citing section numbers or case names with false confidence when the exact reference is uncertain, producing confidently wrong authority.
Candidates believe partial recall is better than no citation and fear that omitting a reference will lose marks.
What to do instead
State the rule accurately and describe the provision by its subject matter when the number is uncertain, reserve exact citations for provisions verified during revision, and build a personal verified-citation list reviewed weekly.