The first part of this question essentially requires candidates to discuss the role and legal duties of promoters in company law. The second part of the question requires an explanation of the meaning of the term ‘pre-incorporation contract’ and the potential consequences of such a contract.

(a) 
4–5 marks 
Good to thorough explanation of the nature and function of a company promoter. The very best answers should have some reference to the fiduciary nature of the promoter’s position with respect to the company with
perhaps reference to cases.

2–3 marks 
Some, but limited, understanding of the role of the promoter, perhaps lacking in detailed legal knowledge of the subject.

0–1 mark 
Little, if any, knowledge on the topic.

(b) 
4–5 marks 
Thorough explanation of the common law and statutory provisions, perhaps with cases and some suggestion as to how to avoid the problems inherent in pre-incorporation contracts.

2–3 marks 
Some, but limited, understanding.

0–1 mark 
Little, if any, knowledge on the topic.