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• WHAT IS LAW?

• MEANING?

• DEFINITION?

• PURPOSE?

• ROLE?
 WHY STUDY LAW
• Overwhelmed!...so different from studying accounts,
marketing, economics, IT or HR.

APPROACH:
• Learning relevant legal terminology
• Framework of particular area of law i.e. relevant
legislation
• Application of daily life examples.

MISCONCEPTION:
• Studying law is dull….merely a matter of memorising
and reproducing
 WHY STUDY LAW?
• Obvious! Course Requirement.
• Study of law improves powers of reasoning, clarity of
thought and the ability to analyze and express
complicated ideas.
• A greater appreciation of the workings of the system
and the parts that ensure it’s functioning.
• Law forms the foundation on which any civilized
society is based. Nature has its own laws. So does
society.
• Law effects all aspects of life and society and is the
mechanism for change employed by governments
across the globe.From the protection of life and
liberty, through corporate law to international
relations, the law is the central stage.
 WHY STUDY LAW?
Contd.

Law is of interest to all persons, not just to lawyers.

Those entering the world of business will find
themselves subject to numerous laws and
government regulations. A basic knowledge of
these laws and regulations is beneficial—if not
essential—to anyone contemplating a successful
career in the business world of today.
 CONTD….
• Legal education..not exclusively for entering into legal
profession. Not to teach to be lawyers BUT….
• Key legal topics
• How law works and effects business operations
• Will assist future business people with decision
making, ethics
• Develop an awareness when legal advice is needed
• Importance foundation knowledge important…know
how the law effects business.
NOT:
• Think like a lawyer
• Adopt a critical legal analysis approach
 VARIOUS MEANINGS AND
DEFINITIONS
• One view is that it is not capable of definition
• But this cannot be the answer nor solve the problem
• The confusion in defining law arises out of the
different purposes to be achieved e.g.:
• Law has been defined by various individuals from
different points of view
• Various schools of law define it from different
angles:
- basis of nature
- on source
- terms of effect on society
- end or purpose of law
MEANINGS AND DEFINITIONS
—Contd.
A universal and uniform definition is difficult. The
evolution of society is of a dynamic nature and hence
the difficulty in accepting a definition by all. One reason
in defining law is the different types of purpose sought
to be achieved:

HORSE to a zoologist, a traveller, polo player, for

some article of food etc.
 DEFINITIONS---Contd.
There have been and will continue to be different
definitions of law:

• ARISTOTLE (384-322 B.C.) ‘a pledge that citizens of

a state will do justice to one another’
• PLATO ( 427-347 B.C.) believed that law was a form
of social control.
• SIR WILLIAM BLACKSTONE (1723-1780) ‘ a rule of
civil conduct prescribed by the supreme power in a
state, commanding what is right, and prohibiting
what is wrong’
 MEANINGS AND
DEFINITIONS: Contd.
• Generally and the most commonly accepted
definition is “ A rule of action to which men are
obliged to make their conduct comfortable”
• “Law is the command of the sovereign. It
imposes a duty and is backed by a sanction.
Command, duty and sanction are three elements
of law”
All these definitions vary but all are based on:
law consists of enforceable rules governing
relationships among individuals and between
individuals and their society.
 LAW MAKING:PROCESS

LEGISLATION: The making of law. The act of

enacting or legislating laws.

• Bill----Proposal
• Committees of the House
• Approval by the Legislature
• Assent by the President.

Difference between Law and Ordinance

 PURPOSE OF LAW

• Object of law is to maintain law and order in the

country i.e. police functions
• Another view ‘limit natural liberty’; Man is born free
but is in chains everywhere.
• Hindu view , purpose of law is the welfare of the
people in the world and also salvation after death.
• Muslim: ‘ the end of the law is to promote the welfare
of man both individually and socially, not merely in
respect of life on this earth but also life hereafter.
 KINDS OF LAW
1. IMPERATIVE LAW. Imposed upon on men by some authority.
Emphasis on the will and physical force of the organized
political community.
2. PHYSICAL OR SCIENTIFIC LAW . Laws of science e.g. law of
gravity
3. NATURAL or MORAL LAW. Universal rules of governance.
Principles of natural justice. Divine Law.
4. CONVENTIONAL LAW. Rules or regulations of voluntary
organizations e.g. associations, clubs etc.
5. CUSTOMARY LAW. Customs, practices, traditions with historical
sanction and support e.g. jirga
6. TECHNICAL LAW. For efficient conduct of business e.g building
laws, laws of health
7. INTERNATIONAL LAW. Sum of laws and rules recognized by
civilized in their dealings with each other
8. CIVIL LAW. Municipal Law.
 ADVANTAGES AND
DISADANTAGES.
• Uniformity and certainty to the administration of
justice.
• Avoids the dangers of arbitrary, biased and dishonest
decisions.
• Fixed principles protect the administration of justice
from the errors of individual judgment
• More reliable than whims, wishes and desires.

1. Rigidity.
2. Conservative
3. Formalism
4. Complex.
 JURISPRUDENCE
• Philosophy of law. Study and theory of law.
Different philosophies how law has developed:
Natural Law: The law is based on what is morally correct
and ethical.
Historical: The law consists of social traditions and
customs.
Analytical: The law is shaped by logic
Sociological: The law provides a way to advance certain
goals in the best interests of society.
Command: The law is the set of rules created and enforced
by the governing party.
Critical Legal Studies: Legal rules are unnecessary and
legal disputes should be solved by using rules based on
fairness.
Law and Economics: Promoting market efficiency should
be the key concern of the law.
 JURISPRUDENCE...Contd.
Human Behaviour....dominating, historically,
chronogically:

Customs and Traditions: first laws created to

govern human behaviour. First law or practices set
by man. Passed down from generation to
generation.

Imperialistic: imposed by men on men. To portray

which customs and practices were superior. What
was right and what was wrong kept changing with
shift in power dynamics. Natural need to dominate.
A small strong group controlled a large weak
group e.g. Egyptian, Greek empires
 JURISPRUDENCE...Contd.

Religion: concept of justice and equality for all.

Defined all matters of life and the correct way of
handling them. Laid authority to a supreme
power not known to man. Beginning of moral
code. Basis for all civil and criminal law. On
which morals and international law stands today.
LEGAL HISTORY

HANDOUT
NATURE OF LAW

HANDOUT
PAKISTAN...LEGAL HISTORY

HANDOUT
 COMMON LAW
• Before the Norman Conquest in 1066 each locality
in England was subject to local laws established by
the local ruling Lord or chieftain.
• William the Conqueror and his successors began
to replace the local laws with one uniform system
of law.
• English Common Law was developed over
centuries by judges appointed by the monarch,
who delivered their opinions when deciding cases
brought before court.
• The emphasis of law at that time was legal
procedure over the merit of case.
• Monetary compensation (damages) was the only
remedy available
 COMMON LAW...Contd.
• To mitigate limited remedies available and unfair
judgments, under the authority of Lord Chancellor,
Court of Chancery (equity) were established.
• Appeals lay before these courts against the decisions
of Kings Courts.
• The Courts of Chancery would grant appropriate
remedy.
• These remedies were known as equitable
remedies...designed to deal with particular fact
situations.
• Equitable remedies took precedence over the decisions
of the Kings Courts.
• In the 19th century a law passed by the Parliament
merged the two court systems.
ADMINISTRATION
OF JUSTICE
 WHAT IS JUSTICE?
The quality of being just; propriety; correctness;
justness; rightfulness; vindication of right; merited
reward or punishment
The act of rendering what is right and equitable
towards one who has suffered a wrong.

ADMINISTRATION OF JUSTICE can be defined as

the maintenance of rights within a political community
by means of the physical force of the state.
The origin and growth is identical with the origin
and growth of man. The social nature of man demands
that he must live in society.
Owes its origin to the transition from the natural
to the civil state in the substitution of the force of
organized community for the force of individuals , as the
instrument of redress and punishment of injuries.
 Cont’d:
It has substituted the primitive practices of private
vengeance. People are now defended by the power of state
through its courts of law

Both a narrower and a wider sense:

NARROW flows from the dictionary meaning; after its
institution till the pronouncement of judgment and execution
of the decree, judgment or order.

WIDER: include aspects connected with the

administration of justice.

Divisible into administration of civil justice and

administration of criminal justice.
 Cont’d:
• The Code of Civil Procedure 1908 prescribes for
proceeding in civil cases.

• In two parts– Sections: contain the basic and

fundamental principles, can be amended only by the
legislature. Schedules : contain rules or procedures
and can be amended by the high court.

• The Code of Civil Procedure prescribes detail

procedure regarding filing of suite, pleading,
proceedings, writing of judgment and executing of
decrees.

• The Code of Criminal Procedure, 1898 prescribes

the criminal procedure
 Cont’d:
• The Qanun-e-Shahadat Order 1984 prescribes the
competency of witnesses where examination, evidence
and procedure for presenting the same.

• The Special Courts follow the procedure prescribed in

the above codes (Code of Civil Procedure 1908 and
The Code of Criminal Procedure)

Differences between civil and criminal:

• Civil- - -enforcement of rights; Criminal- - -concerned

with the punishment for them.

• The difference between public and private wrongs

 Cont’d:
• Distinction between civil wrongs and crimes relates to
legal consequences. Administered according to its own
and separate set of forms; in the legal consequences of
acts

• Object of civil proceedings is to enforce rights and

object of criminal proceedings is to punish wrongs. But,
sometimes civil and criminal proceedings may have a
similar result in some cases.

PURPOSE: CRIMINAL JUSTICE;

1. Deterrent: Important--- make the law breaker an
example for others so that they think of the
consequences before braking the law,
 Cont’d:
2. Preventive: to disable the offender from committing
the same offence again e.g. by imprisonment, etc.

3. Reformative: Identifying the crime with disease and

treating is such---cure and not criminals.

4. Retributive: Private vengeance no longer in the

private sense but the offender should be punished.
 Cont’d:
PURPOSE: CIVIL JUSTICE enforces primary
rights and sanctioning rights.

Primary rights exist as such , do not have their

source in some wrong.

Sanctioning or remedial rights are those which

come into being after the violation of a primary right.

THERE IS NO BETTER TEST OF THE

EXCELLENCE OF A GOVERNMENT THAN THE
EFFICIENCY OF ITS JUDICIAL SYSTEM
 ARRANGEMENT AND
INTERPERTATION OF ACTS (LAW)
PURPOSE:
Every Act (law) has a purpose for which it is enacted
(made).

CHAPTERS AND SCHEDULES:

Every Act is divided in Chapters. Every Chapter deals
with a particular subject. Schedules are part of the Act; often
containing rules dealing detail a subject dealt summarily
within the Act.

SECTIONS,SUB-SECTIONS, CLAUSES AND SUB-

CLAUSES
Every Chapter has a subject. Each aspect of this subject
is dealt with in a separate section. Each section deals with a
particular topic. Its various aspects are then dealt in separate
sub-sections which is further divided into clauses and sub-
clauses
 Cont’d.
DEFINITIONS:
Where and when a word is specifically defined it has a special
meaning otherwise it has ordinary dictionary meaning. A specific
meaning over rules the ordinary dictionary meaning

TWO TYPES:
1. EXCLUSIVE DEFINITION: Gives a precise meaning
completely replacing ordinary meaning. Excludes all other
meanings. Begins with the word ‘MEANS’
2. INCLUSIVE DEFINITION: Expansive definition. Begins with
‘INCLUDES’. Has both elements

PROVISO:
Normally varies the meaning or operation of a section, sub-
section. Makes an exception to the main provision

EXPLANATION:
Specifies the meaning of a word, term or phrase which is
ordinarily capable of signifying more than one meaning or
interpretation
 Cont’d.
• Law divided into PARTS and each deals with a
particular subject e.g. Part II Jurisdiction of Courts.
Part III SECP, Part IV Incorporation of Companies
• Sections
• Sub Sections
• DEFINITIONS: The word or a term specifically
defined has a special meaning assigned to it and
replaces its ordinary meeting. Otherwise have their
ordinary dictionary meaning e.g.
• Proceed in alphabetical order
• Section 2 (7) “Company” means a company formed
and registered under this Ordinance or an existing
Company
 THE JUDICIAL SYSTEM OF
PAKISTAN
• On independence, the government of India Act 1935
was retained as a provisional constitution

• The legal and judicial system of the British period

continued with modifications.

• The Lahore High Court and the Sindh Chief Court

continued to function.

• Similarly the courts of the Judicial Commissioner

in NWFP (KP) and Baluchistan.
 Cont’d
• A High Court was set up at Dhaka.

• A new Federal court of Pakistan was also established.

• A look at the hierarchy and system of courts in

Pakistan.

• The powers, authority and jurisdiction of the federal

and high courts remained intact as prescribed under
the Government of India Act 1935.

• The constitutions of 1956, 1962 & 1973 did not

drastically alter the judicial structure or the powers
and jurisdiction of the superior courts.
 Cont’d
• Only, the Federal Court was renamed as the Supreme
Court by the 1956 constitution.

• The 1973 constitution upgraded the Chief Court of

NWFP and the Judicial Commission court of Pakistan
into full fledged High Courts.

FEATURES

• The constitution of Pakistan contains elaborate

provisions for the composition, jurisdiction,
powers and functions of the courts
 Cont’d
• The constitution provides for the “separation of
judiciary from the executive” and the “independence
of judiciary”

• Qualifications, appointment, service conditions etc. of

the judges are also laid down in the constitution.

• The forum as procedure for the removal of judges of

the superior courts are also provided in the
constitution..... The Supreme Judicial Council.

• Courts are federal and provincial in nature.

 Cont’d
• System made up differing in levels of legal superiority

• System separated by jurisdiction

LITIGATION

The process of bringing, maintaining and defending a

legal case in court.
 Superior Judiciary
• The constitution of Pakistan contains provisions on the
composition, jurisdiction, functions.

• Constitution provides for separation of judiciary from the

executive, independence of judiciary and the obligation to
preserve, protect and defend the Constitution

• Qualification of Judges, appointment, service conditions

etc.

• The forum and procedure for the removal of judges.

• In the famous case of Al-Jehad Trust The Supreme Court

clarified the procedure and qualification for appointment
of judges to the Supreme and High Courts and their Chief
Justices
 Cont’d
• The Chief Justice recommended a panel to the
President who would select from the said panel a
suitable judge.

• For appointment in the High Courts, the respective

Chief Justices would forward a panel to the President
through the Governor of the Province and Chief
Justice of Pakistan.

• The recommendation of the Chief Justice was binding

on the President, except for sound reasons to be
recorded by the President.

• This procedure has been changed by the Constitution

18th and 19th (Amendments) Acts 2010.
 Cont’d
• Now Judges of the Supreme Court are appointed
through a Judicial Commission:
 Chief Justice of Pakistan as Chairman
 Four Senior most Judges of the Supreme Court
 One Former Chief Justice of the Supreme Court
(nominated by the Chairman in consultation with
the four member judges for a period of two years)
 The Attorney General of Pakistan
 Federal Law Minister
 A senior Advocate, of the Supreme Court
nominated by the Pakistan Bar Council.
 Cont’d
• The name recommended goes to an 8 member
PARLIAMENTARY COMMITTEE – equal
representation of Government and Opposition as well
as National Assembly and Senate.

• The Committee has two weeks to consider the

nomination.

• If approved the name is forwarded to the President

and Prime Minster for appointment.

• The Parliamentary Committee, for reasons to

be recorded, may not confirm the
recommendation by three-fourth majority.
 Cont’d
• This decision is sent back to the Judicial Commission
through the Prime Minister and the Commission
sends another nomination.

• The President has to appoint the senior most judge of

the Supreme Court as the Chief Justice of Pakistan.

• For the appointment of Chief Justice and Judges of

The Federal Shariat Court the Chief Justice and
most senior judge of the said Court are added to the
composition of the Judicial Commission.

• For appointment of the Chief Justice the most

senior judge is excluded.
 Cont’d
• For appointment of Chief Justice and Judges of High
Courts:
 The Chief Justice and senior most judge of their
respective High Court
 Provincial Minister for Law
 Nominee of the Provincial Bar Council (Advocate of
High Court of fifteen years standing)
 For appointment of Chief Justice the senior most
judge is excluded.

Appointed by the President through nominations

by Judicial Commission and confirmation by the
Parliamentary Committee
 Accountability
• Procedure prescribed in the Constitution– Supreme
Judicial Council:
• Chief Justice of Pakistan as chairman
• Two most senior judges of the Supreme Court
• Two most Senior Chief Justices of High Court
• Registrar Supreme Court as Secretary

• Supreme Judicial Council either on reference from the

President or suo moto investigates the matter and
presents its finding to the President.

• The President may order removal of such a judge.

• Removal has to be on specified grounds and subject to

prescribed procedure.
 Supreme Court
• Apex court. Original, appellate and advisory
jurisdiction.
• Court of ultimate appeal, final arbiter of the law and the
constitution
• Decision binding on all other courts.
• Original jurisdiction in inter-governmental disputes–
between federal and provincial government or among
provincial governments
• Original jurisdiction for enforcement of fundamental
rights
• Advisory jurisdiction in giving opinion to the
government on a question of law.
 Supreme Court
• Appellate jurisdiction against judgments of Federal
Shariat Court, Service Tribunals and some special
courts.
• Principal seat at Islamabad and four branch registries
at each provincial capital.
• Advisory jurisdiction in giving opinion to the
government on a question of law.
• Appellate jurisdiction against judgments of Federal
Shariat Court, Service Tribunals and some special
courts.
• Principal seat at Islamabad and four branch
registries at each provincial capital.
 Supreme Court
• Court consists of the Chief Justice and 16 judges
(number determined by law)
• Provision for appointment of acting and ad hoc
judges.
• Five years experience as a judge of a High Court or
fifteen years standing as advocate of a High Court
(eligible to be appointed as judge of Supreme Court).
 High Courts
• One in each province and one for Islamabad Capital
Territory

• A Chief Justice and other judges in each court:

• Lahore High Court strength fixed at 60
• Sindh High Court—40
• Peshawar High Court---20
• Baluchistan High Court- --11
• Islamabad ---11

• Ten years experience as advocate of High court or ten

years service as a civil servant including three years
as district judge or ten years in a judicial office.
 High Courts
• Appointed by the Judicial Commission.

• A judge cannot be transferred without his consent

and consultation by the President with the Chief
Justices of Supreme Court and High Court.
• Original jurisdiction in enforcement of Fundamental
Rights.
• Appellate jurisdiction in judgment /orders of sub-
ordinate courts, both in criminal and civil matters.
• Supervises and controls all the courts
subordinate to it.
 Federal Shariat Court
• Established in 1980 through a Presidential Order.

• Created as an Islamisation measure and protected

under the 8th Amendment.

• Comprises of eight judges out of which three are

required to be Ulema well versed in Islamic Law.

• Hold office for three years which may be extended by

the President.

• Procedure for appointment through the Judicial

Commission.
 Federal Shariat Court
• On its own or through a petition by a citizen or
government ( Federal or Provincial), may examine
and determine as to whether or not a certain
provision of law is repugnant to the junctions of
Islam.
• Appeal against its decisions lie to the Shariat
Appellate Bench of the Supreme Court.
• The Bench consists of three Muslim judges of the
supreme court and not more than 2 Ulama appointed
by the President.
• If a certain provision is declared to be repugnant, the
government to amend the law in conformity with the
injunctions of Islam.
 Federal Shariat Court
• Appellate and revision jurisdiction over the criminal
courts, deciding Hudood cases.
• Decisions binding on high courts and subordinate
judiciary.
• Difference of opinion:
 Duplicates the functions of the existing superior courts
 Mode of appointment and tenure
 Meet the criteria for the independence of judiciary
 Not immune from influences of executives.

• Protection of Women (Criminal Laws Amendment)

Act 2006, considerably curtailed its jurisdiction.
 Subordinate Courts
The subordinate judiciary broadly divided into

1. Civil Courts( established under the West Pakistan

Civil Courts Ordinance 1962)

2. Criminal Courts ( created under Criminal

Procedure Code 1898)

• Judges of Civil and Criminal courts are appointed by

Provincial Governments and regulate their terms and
condition of service .

• The High court exercises administrative controls over

courts.
 Subordinate Courts
• Civil Courts consist of District Judge, Additional
District judge, Senior Civil Judge and Civil Judge
Class I, II, III.

• Appeal against the decisions of the civil judge lies to

the district judge and high court--- depending upon
the value of suit.

• Criminal courts comprises : Session Judge, Additional

Session Judge and Judicial Magistrate Class I, II,III.

• Appeals against criminal courts lie to session

judge or high court depending upon the
quantum of penalty
 Subordinate Courts
Appointment and Recruitment
1. Civil Judge-cum-Judicial Magistrate--- initial
recruitment through Public Service Commission with
the active involvement of the High Court.
2. A competitive examination– written test and a viva
voce.
3. Promotion—by a committee of the judges of the high
court.
4. Additional District and Session Judge --- quota fixed for
service personal as well as induction from the Bar
5. District and sessions judge--- Promotion on basis
of seniority –cum-fitness from among the
serving judicial officers.
 Subordinate Courts
6. High Court exercises both administrative as well as judicial
supervision.

7. Administrative--- Disciplinary proceedings may be initiated

against the judicial officer by the High Court.

8. Judicial Control– Revisions and Appeals filed in High Court

against the orders and decisions of subordinate courts.

9. Supervisory--- Through inspections and calling of records.

10. The judicial officers have right of approaching the Provincial

Judicial Service Tribunal (headed by the judges of the
High Court) for redress of their grievances.

11. Appeal against their decisions lies to the Supreme Court.

 Tribunals and Other Courts
• Created under Special Laws and enactments.

• Tribunals provide a specialized forum requiring

application or expertise.

• Jurisdiction, powers and functions specified in the

laws creating them.

• The constitution authorizes the Parliament to

establish administrative courts and tribunals for
dealing with federal subjects.

• Many created which operate under the administrative

control of the Federal Government.
 Tribunals and Other Courts
• Tribunals are less expensive to run than courts.

• Waiting period for a hearing before a tribunal is

generally shorter than for a court hearing.

• Decisions of tribunals receive relatively less publicity.

• Generally people are less aware of the decisions of

the tribunal.

• Procedure is more informal and flexible than court

procedure.
 Tribunal and Other Courts
• Such Courts/Tribunals include :

– Special Courts ( control of narcotic substances)

– Banking courts ( recovery loans)
– Special courts (Offences in banks)
– Special courts (customs, taxation and anti-smuggling)
– Income Tax Appellate Tribunal
– Environment Appellate Tribunal
– Insurance Appellate Tribunal
– Customs
– Excise and Sales tax
– Special Judges
– Drug courts
– Anti-terrorism Courts
– Accountability courts
 Tribunal and Other Courts
• Provincial Governments have their own Special
Courts/ Tribunals
• Appeals or revision against such courts lie before the
superior judiciary (High Court and/or Supreme Court)
• Provincial Governments have their own special
courts/ Tribunals:
– Labour Courts
– Consumer Protection Courts
– Anti-Terrorism Courts
– Anti- Corruption Courts.
• Appeals or revision against such courts lie before the
superior judiciary (High Court and/or Supreme Court)
 Tribunal and Other Courts
Service Tribunals

• Exclusive jurisdiction relating to terms and conditions

of service of civil servants under the constitution.

• At Provincial and Central level.

• Its members appointed by the respective

governments.

• Appeal lies to the Supreme Court

STARTING A BUSINESS
 STARTING A BUSINESS
Purpose in starting business is to be
successful. Every business venture contains
certain inherent risks, and any number of
alternatives. Before starting the first thing to
consider the legal form operating under
because has a number of advantages and
disadvantages e.g.
COMPANY: has a higher tax rates, stricter
laws, elaborate accounting procedures, legality,
forms, statements etc.
PARTNERSHIP require registration of
business
 STARTING A BUSINESS—
Cont’d.
Successful business is a tight hold on expenditures;
anything that does not make money, protects
investment should not be ventured to especially in
the beginning. The most important element of
eventual success will be the soundness of planning
before starting business. Success takes planning
and planning involves and includes an
understanding and grasp of Business Laws
 STARTING A BUSINESS
ENTREPRENEUR: One who initiates and
assumes the financial risks of a new
enterprise and undertakes to provide or
control its management.
Question before entrepreneur what form of
business organisation choose for his business
endeavour:
OPTIONS:
1. Sole Proprietorship
2. A Partnership
3. Limited Liability Partnership
4. A Corporation (Limited Company)
 SOLE PROPRIETORSHIP
• Simplest form
• Owner is the business
• Business without creating a separate business
organization
ADVANTAGES:
1. Proprietor receives all the of the profits (all risks
assumed)
2. Easier, less costly than to start any other kind of
business
3. Entails more flexibility compared to other
organizations
4. Free to make any decision concerning the business
5. Pays only personal income tax (relatively less)
 SOLE PROPRIETORSHIP
DISADVANTAGES:
1. Alone bears losses or liabilities incurred by the
business
2. Unlimited liability or legal responsibility for business
obligations incurred
3. Opportunity to raise capital is limited mostly to
personal funds
4. Lack of continuity upon death of proprietor.
Automatically dissolved
5. If transferred to family members new proprietorship
created
 BUSINESS LAW IN PAKISTAN
• Legal form under which operating
• Main forms of business organizations by
PRIVATE sector in Pakistan:
• Sole Proprietorship
• Partnership
• Limited Liability Company
• Joint venture: Created in contemplation of a
limited activity or a single activity.
• PUBLIC SECTOR. Where the Government
undertakes an enterprise either a statutory
corporation or limited company.
• For medium and large scale business in Pakistan
limited company is the preferred form.
 Introduction

Keeping promises is important to a stable

society. Contract law deals with, among other
things, the formation and keeping of promises.
Like other types of law, contract law reflects
social values, interests, and expectations at a
given point in time e.g. what kind of promises
should be legally binding, what excuses are
accepted for breaking promises, legally void or
invalid.
 FUNCTION OF CONTRACTS

• No aspect of life is entirely free of

contractual relationships

• Contract law is designed to provide stability

for both buyers and sellers

• Followed in business agreements to avoid

potential problems

• Necessary to ensure compliance

 LAW GOVERNING
CONTRACTS
Resolving such questions is the essence of
contract law. In business law and the legal
environment of business, questions and
disputes concerning contracts arise daily.
The law which governs contracts is:

THE CONTRACT ACT of 1872.

• Promulgated on 25th. April,1872
• Technically Act IX
• Chapters 10
• Sections 237
Law of Contract
in Pakistan
 CONTRACT ACT, 1872
• CHAPTER I
Of the Communication Acceptance and
Revocation of Proposals.
• CHAPTER II
Of Contracts, Voidable Contracts and Void
Agreements
• CHAPTER III
Of Contingent Contracts.
• CHAPTER IV
Of the Performance of Contracts
 CONTRACT ACT, 1872
• CHAPTER V
Of Certain Relations Resembling Those
Created By Contract.
• CHAPTER VI
Of The Consequences of Breach of Contract
• CHAPTER VII
Repealed
• CHAPTER VIII
Of Indemnity and Guarantee
 CONTRACT ACT, 1872
• CHAPTER IX
Of Bailment
• CHAPTER X
Agency.

The first 6 chapters lay down the general

principles on which all contracts are
based, while the rest deal with the
important classes of commercial
contracts viz. indemnity and guarantee,
bailment, agency
 CONTRACT ACT
• Extends to whole of Pakistan
• Main source of law regulating contracts in
Pakistan law
• Determines the circumstances in which
promises made by the parties to a contract
shall be legally binding on them.
• Contract creates right and duties upon
contracting parties
• The Act deals with the enforcement of these
rights and duties upon the parties.
A Contract?
INTERPRETATION CLAUSE—DEFINITIONS

INTERPRETATION OF CLAUSE is a section

of a statute which defines the meaning of
certain words occurring in other sections.

Aims to introduce some of the words and

expressions as are used in Contract Act with
their peculiar meanings and connotations.
Words used to be understood in specific sense.
Some of the word having specific meaning are
discussed:
A contract may be made in any form: it
could be made by word of mouth, by
conduct, or in writing. The starting point
for a contract is a:

PROPOSAL:
Is declaration by the proposer of his
intention to be bound by an obligation if the
offeree fulfills or undertakes to fulfill certain
conditions
A proposal is made when one person
signifies to another his willingness to do or
abstain from doing anything, with view to
obtaining the assent of that other to such act
In order to decide whether an offer has been made,
a court will consider the intentions of the parties,
ascertaining them from the circumstances of the
case. The terms of an offer must be clear and
certain.
PROMISOR:
Person making the proposal.
PROMISEE:
Person accepting the proposal.
The promisor and the promisee must be two
different persons.
The two must exist to constitute a contract.
ACCEPTANCE:
Of an offer is the unconditional agreement to all
the terms of the offer. It is the agreement to the
exact terms of the offer.
PROMISE:
An undertaking by one man with another for
the performance or the non-performance of some
particular thing. A verbal covenant
The technical use is narrower than the
popular use.
The proposal when accepted becomes a promise.
There must only be a proposal but there must be an
acceptance of the proposal by the other side
Every promise is an accepted proposal

CONSIDERATION:
Act, done or promised to be done, at the
desire of the promisor.
• At the desire of the promisor, the promisee or
any other person
• Must have done or abstained from doing, or
 •Must do or abstain from doing or
•Must promise to do or abstain from doing
something
• Consideration needs to be contemporaneous
with the promise since it is the price of the
promise and therefore past consideration is no
consideration.
• Acts done in gratitude e.g. giving someone a
reward for finding your wallet does not make
this a contractual transaction
• An agreement without consideration is void.
• Consideration must move from the promisor to
promisee
• It someone else furnishes consideration, the
promisee becomes a stranger to the contract.
AGREEMENT:
• Every promise and every set of promises,
forming consideration for each other.
• An accepted proposal. Result of a proposal
from one side and its acceptance by the
other.
• Regarded as a contract when it is
enforceable by law.
• An agreement that the law will enforce is a
contract.
 Cont’d.
When one person signifies to another his
willingness to do or to abstain from doing
anything with a view to obtaining the assent of
that other to such act or abstinence, he is said
to make a proposal. When the person to whom
the proposal is made signifies his assent
thereto, the proposal is said to be accepted. A
proposal when accepted becomes a promise.
The person making the proposal is called the
promisor. The person accepting the proposal is
called the promisee.
 WHAT ARE CONTRACTS?

An agreement or mutual promise upon

lawful consideration or cause which binds the
parties to a performance; a bargain; a compact.
• A contract is an agreement that can be
enforced in court. It is formed by two or more
parties who agree to perform or to refrain
from performing some act now or in the
future,
• Is an agreement enforceable at law. It is
bilateral document meant to create legal
relationship
 Cont’d.

The first step towards a contract is for the

parties to get into communication with each
other. This is done by one of them making a
proposal. An offer to do or not do something,
and that offer must be made for the purpose of
being agreed to
The next step is that the person, with a view
to whose assent the proposal is made, should
express his concurrence in the act or
abstinence. The proposal now becomes a
promise.
DISTINGUISHING: PROPOSAL (OFFER)
AND INVITATION TO TREAT.
Person making the proposal (offer) is called
the promisor (offerer) and person to whom the
offer is made, and who can thus accept it is
called the promisee (offeree). The proposal is a
statement of intent to be legally bound by the
terms of the proposal if it is accepted, and the
contract exists once acceptance has taken place.
This and it is not always the case, however,
the first stage in negotiations is a proposal
(offer). Often the first step is an entirely passive
state and is open to negotiations e.g. goods
displayed in a showroom of a store.
 This display is not a proposal (offer) but an
example of an invitation to treat….. invitation
to another person to make an offer. Contract is
then formed when the offer is accepted.
It is important to distinguish between an
offer and an invitation to treat as they have
different legal consequences. A person who is
not take prepared to take the legal
consequences of the offer being accepted should
not make an offer e.g. to pay a reward, by placing
an advertisement, to the person who fulfills the
requirements of the offer.
An invitation to treat is not an offer it is
only invitation to the other party to make an offer
e.g. goods displayed in a shop with price a label;
the shopkeeper is not obliged to sell it at the
displayed price because display is an invitation to
treat, not an offer.
The offer must be certain, it must be notified
to the party to whom it was made
(promisee/offeree) although the offer may be made
to no one person in particular as in the case of an
advertisement placed in a newspaper.
An invitation to treat is not an offer that is
capable of being accepted by the other party. It is
a pre-offer whereby party A is asking party B if
they would like to make an offer which party A
may accept or refuse. The party making the first
statement envisages further negotiations before a
contract is formed.
 DISTINCTION
OFFER (PROPOSAL) INVITATION TO TREAT
Party A makes an OFFER Party A makes an
(PROPOSAL) INVITATION TO TREAT
(This is not an OFFER)

Party B makes an
OFFER TO BUY
(This is not an acceptance)

THE CONTRACT CANNOT BE

FORMED AT THIS POINT

Party A agrees to sell (this is the

Party B ACCEPTS the OFFER ACCEPTANCE)
(PROPOSAL)

CONTRACT formed at this point CONTRACT formed at this point

 The point at which a contract is made in a
standard offer (Proposal) and acceptance, and where
there is firstly an invitation to treat.
Generally, advertisements placed in newspapers,
magazines, or posted on websites are invitations to
treat even if they are headed ‘offer for sale’.
Applications inviting tenders and catalogues and
prospectuses are invitations to treat. A tender is where
a person seeking to have work carried out issues a
statement inviting interested parties to submit the
terms on which they are willing to carry out the work.
The statement inviting tenders is an invitation to treat.
The person making the tender is the offeror and the
other party can accept or reject the offer made. If a
tender is accepted then a binding contract comes into
existence.
 PROPOSALS—COMMUNICATION,
ACCEPTANCE AND REVOCATION

Before a proposal is accepted there is

COMMUNIUCATION:
Communicate: Imparting of news or information on
one side and reception and understanding on the other.
The communication of an offer may be written,
spoken, or by conduct, but a person cannot accept an
offer he does not know about.
Rule when communication of proposal is considered
complete.
• Not a mere mental assent to the terms of an offer.
• Some act done with the intention of communicating the
resolution to the other party
 COMMUNICATION
• Mere intention not communicated by words or
conduct cannot give rise to a contract
• Communication of a proposal is complete when
it comes to the knowledge of the person to
whom it is made.
• Communication of an acceptance is complete,
as against the proposer, when it is put in
course of transmission to him.
Acceptance
Agreeing to a previous act or promise to do by
another. The acquiescence to an offer of a party
makes the agreement enforceable in law.
Signifying one’s assent to the proposal made by
another.
 REVOCATION
REVOCATION:
The calling back of a thing done. The making
void of a deed that was in force, the cancelling of
an authority once given.
The communication of a revocation is
complete, as against the person who makes it,
when it is put it is put into course of transmission
to the person who made it
A proposal may be revoked at any time before the
communication of its acceptance is complete as
against the proposer but not afterwards. An offer
may be revoked at any time up until it is
accepted, even if the offeror has informed the
offeree he will keep it open for a period of time.
An acceptance may be revoked at any time
before the communication of the acceptance is
complete against the acceptor but not
afterwards
A proposal can be revoked, obviously
before it becomes a contract, by:
1. Communication of notice of revocation
2. Lapse of stipulated time in the proposal
3. If the proposal is conditional or qualified by
the failure of the acceptor to fulfill the
condition precedent
4. By the death or insanity of the proposer, if
the fact comes to the knowledge of the
acceptor before acceptance
 AGREEMENTS, CONTRACTS—VALID?
Contract is always based on agreement. But an
apparent agreement is not always a real
agreement.
The first great distinction between various sorts of
agreements arises out of the question whether they
are legally enforceable or not. Agreement
enforceable by law are defined as contracts.
Qualifications necessary in order to render an
agreement enforceable, in other words, to
constitute a contract. A valid contract has the
following elements necessary for contract
formation;
• An agreement (proposal and acceptance).
• Supported by legally sufficient consideration
• For legal purpose
• Made by parties who have the legal capacity to
enter into the contract i.e. CONTRACTUAL
CAPACITY:
1. Age of majority: when supplies made to minor
binding on him and his estate responsible for
payment
2. Sound mind: at the time making contract is
capable of understanding it, and of forming a
rational judgment as to its effect upon his
interest
3. No other disqualification like foreign enemy
4. FREE CONSENT i.e. when not caused by:
• Coercion. It becomes voidable at the option of the
person whose consent was obtained by coercion.
• Undue influence. Domination of a weak mind by
a strong mind.
• Fraud: False representation of fact made with a
knowledge of it
• Misrepresentation. causing a party to make a
mistake.
In other words it is a bilateral document
meant to create legal relationship. It is conceived
by valid acceptance of a valid offer at the desire of
the promisor.
 VOID AGREEMENT, CONTRACT

Every contract is an agreement but every

agreement is not a contract. Agreement
enforceable at law when it is not against public
policy, immoral, without consideration, having not
been hatched through fraud or deceit.

Numerous agreements which the law refuses to

enforce them are said to be void. A void contract is
without legal effect. Such a contract is a nullity and
no right is acquired under or through it and is void
ab initio.
Agreements which the law expressly declares to be
void:
1. Agreement made without consideration; does not
specify adequacy
2. Marriage with a minor
3. Trade contrary to public policy
4. Wagers ; immoral tendency. No suit can be
brought.
5. Agreements where the meaning of which is not
and cannot be made certain.
6. Agreements to do something impossible;
physically impossible for the promisors to
perform: e.g. magic.
 VOIDABLE CONTRACT:

A voidable contract lies in a middle zone between

valid and void contracts. A contract is voidable when
it is enforceable by law at the option of one party but
not at the opinion of the other.
Is enforceable by one of the parties to it but not by
the other.
Where a contract is voidable there are different
possibilities. The vitiating factor is identified and
acknowledged but this does not necessarily mean
that the contract is at an end.
A party who has entered a contract that is
voidable for a vitiating factor can continue
with the contract if that is to his benefit.
On the other hand, that party can avoid their
responsibilities under the contract and in effect
set the contract aside.

Difference between void and voidable

contract
• Void means absolutely null, incapable of
ratification or confirmation and of no effect
whatever.
• Voidable is something which could be
avoided or confirmed and which is not
absolutely void.

• What is voidable has some force or effect, but

which may be set aside or annulled for some
error or inherent vice of defect.
CONTRACT—PERFORMANCE.
So far.......
• Elements of which a contract consists.
• Conditions subject to which it is enforceable.
• Circumstances in which it is or becomes void.
• Contingencies on which it may dependent.
NOW.....Mode in which contract must be carried...

PERFORMANCE
A contract creates obligations. “Performance of a
Contract” means the carrying out of these
obligations.
• Co-operation of both parties is necessary.
• Parties must either perform or offer to perform
their respective promises, unless such
performance is dispensed with or excused under
the law.
• Deals with time, mode, and order of
performance as also who is bound to perform
and who can demand performance
• The time and place to be considered at which
the contract is to be performed.
• Must be in the manner and at the time in which
the promises were made.
• In case of death binding on legal heirs unless
contrary to it from the contract.
• Within a reasonable time: When promisor to
perform without demand from the promisee and
no time fixed then promisor must perform within
reasonable time (reference to nature of
character of goods dealt, surrounding
circumstances, facts of case)

• Usual business hours on the day agreed: In this

case when day for performance is fixed by the
contract the promisor has to perform when
promisee applies at any time during the usual
business hours.
• No place fixed: When the promisor is bound by
the terms of the contract to perform his promisee
without any demand being made by the
promisee, it is the duty of the promisor to apply
to the promisee to fix a reasonable place for
performance.
• If no application from promisee then duty of
promisor to apply to promisee
• When parties agree on the time of performance
of any obligation under the contract and is made
a condition of the contract then time is the
essence of the contract.
 ASSIGNMENT
ASSIGN is to transfer, make over or set over to
another. ASSIGNMENT is the act of transferring to
another all or part of one’s property, interest or
rights. Process by which right under a contract are
transferred to a person not party to the original
contract.
Assignment can be either by act of the parties
or by operation of law, or according to special rules.
1. Operation by law: in cases of bankruptcy or
purchase or loss of interest of law. The
bankruptcy of a person transfers all his or her
rights and liabilities to his or her trustee in
bankruptcy.
2. Assignment by act of parties: cannot be
assigned (liability passed on) without the
consent of other party. Where personal
considerations are involved contracts cannot be
assigned. Benefit can be assigned over to other
party provided the benefit does not entail any
liability.
• Shares in a registered company
• Patents
• Copyrights
• Life assurance policies
 CONTRACT—TERMINATION &
DISCHARGE
A contract is merely not referred being performed
but of its being discharged.
• When the contract was originally made then the
rights and duties made by the two parties were set
up.
• When these rights and duties have been
extinguished then the contract can be said to have
been discharged.
• PERFORMANCE is the most obvious method of
discharge. When promised to do under the contract
then the contract is at an end. Contract may be
said to have been discharged when each party has
completely performed its duties under the contract.
 The contractual ties may be loosened and the
parties wholly freed from the rights and liabilities
under the contract by:

AGREEMENT: A contract comes into existence

because of an agreement between the parties so it
must follow that it can also be discharged by
agreement.

FRUSTRATION: After a contract has been made,

something occurs to make the contract impossible to
perform.....
• Has not been caused by either party;
• Could not have been foreseen;
• And its effect is to destroy the basis of the
contract.
.....contract has been frustrated, and it will have
been discharged and neither party will have any
liability under it.

• WAIVER: Parties agree to demand

performance. Waive rights and by waiver other
party discharged. Alter some of the terms of the
contract.

• NOVATION or Substituted Agreement: Mutual

desire of the parties to substitute a new
contract in place of old. Old contract need not
be performed.
• By RENUNCIATION before performance is
due.
• By IMPOSSIBILITY created by other party
before performance is due.
• IMPOSSIBILITY e.g. change in law.

BY OPERATION OF LAW:
• Merger
• Bankruptcy.
• By BREACH: A contract may be broken. Will
discharge either party from performance.
 BREACH
A breach of contract will occur if one party:
• Fails to perform its part of the contract by the
agreed date;
• Makes it impossible for it to perform the
contract;
• Repudiates its liabilities under the contract.

REMEDIES
Where there is a breach of contract on the
part of one party, the injured party becomes
entitled to any one or more of the following reliefs:
• Rescission;
• Suit for damages;
• Suit for specific performance;
• Suit for an injunction;
When two parties have entered into a
contract and one of them has broken his party of
the bargain then it is only natural that the other
should seek remedy.
RESCISSION:
The injured party is freed from all obligations
under the contract;
DAMAGES:
Form of a money payment; usual remedy awarded
by the courts:
Liquidated: Sum is a fixed or ascertainable.
Damages which the parties have agreed when they
made their contract. Paid by the defaulting party in
the event of the contract being broken.
Unliquidated: Assessed by the court and must be
claimed e.g. loss of earnings, damage to car etc.
• Not allowed to make a profit:
• Purpose is to attempt to put the claimant back
into the same position as he would have been in
had the contract been performed.
• Damages are intended as compensation and not
as punishment.
SPECIFIC PERFORMANCE
Order of the court expressly instructing to perform
the contract:
• An equitable remedy
• Discretionary.
• Contempt of court: defiance of a decree of specific
performance is imprisonment or fine.
INJUNCTION
Order of the court to prevent the doing, continuance
or repetition of some wrongful act.
• An equitable remedy; discretionary.
• Not be awarded if damages would adequately
compensate.
An injunction can be:
Interlocutory (temporary) granted before the trial
of the action. Basically in order to preserve the
status quo.
Perpetual (permanent) granted after the trial
when the dispute has been resolved by the court. It
may last forever.
Prohibitory orders that the wrongful act shall not
be done: this is the usual type.
Mandatory orders the doing of a certain positive
act.
Specific performance is used to compel the
performance of a contract which has not been
performed; injunction is used to order the undoing
of something already done in breach of contract.
 Contracts and Memorandum of
Understanding (MOU)
• Contracts involve the exchange of promises
• A court will enforce its terms if one of the parties
breaches the contract
• A memorandum of understanding is an agreement
between two or more parties. Unlike a contract,
however, an MOU need not contain legally
enforceable promises.
• Parties to a contract must intend to create a legally
binding agreement, the parties to an MOU may
intend otherwise.
• An MOU is often used to define the expectations and
responsibilities of each of the parties.
CONTRACTS—SPECIAL TYPES
The first six chapters of the Contract Act lay
down the general principles on which all contracts
are based, while the rest of the Act deals with the
most important classes of commercial contracts,
viz, indemnity and guarantee, bailment, agency.
The general principles of contract are applicable
to the special contracts.

CONTINGENT CONTRACT:
A contract to do or not do something unless
such event takes place. A conditional contract and
the condition is of uncertain nature e.g. A
contracts to pay B Rs. 10,000 if B’s house is burnt.
Contracts of insurance, are contingent contracts.
• The uncertainty and futurity of the event to
which the contract is related. Liability of
performance is not absolute but depends
upon the happening or not happening of
certain event
• The event being collateral to the event.
Contingency should relate to a matter
collateral to the main purpose of the
agreement
• The contingency should not depend on the
mere will and pleasure of a party, but must
depend on the act of a party.
 CONTRACT OF INDEMNITY
INDEMNITY:
An undertaking to make good monetary or
other loss or damage.
• Loss is to be caused by the conduct of the
promisor himself, or by the conduct of some
other person.
• The loss for which the promisee seeks
reimbursement is really the loss for which the
promisor meant to indemnity him.
• Loss to promisee is essential.
• Unless the promisee has suffered a loss, he
cannot hold the promisor liable.
• Loss must have been occasioned either by the
conduct of the promisor himself or by the
conduct of any other person.
• Loss occasioned by the conduct of the promisee
or an act of God is not covered e.g. A contracts
to indemnify B against the consequences of
any proceeding which C may take against B in
respect of a certain amount.
Scope of indemnity is restricted to those
cases where there is a promise to indemnify
against loss, caused by the (a) promisor himself or
(b) by any other person. Excludes loss from
accidents like fire etc.
Promise of indemnity may be expressed or
implied.
 The person (A) who gives the indemnity is called
the indemnifier and the person (B) for whose
protection it is given called the indemnity-holder or
indemnified.

INDEMNITY HOLDER:
The person to whom the indemnity is given i.e.
the promisee acting within the scope of his
authority. His rights:
• Entitled to claim all damages which he may have
been compelled to pay.
• Recover all cost reasonably covered in resisting,
reducing or ascertaining the claim.
• Can compromise a claim on best term he can and
then bring an action on the contract of
indemnity.
 CONTRACT OF GUARANTEE
Guarantee is a promise to be answerable for
the debt, default or miscarriage of another.
Contract of Guarantee: to perform the promise,
or discharge the liability of a third person in
case of his default. When a third person
promises to pay debt owed by another in the
event the debtor does not pay a guarantee
relationship is created.
The function of a contract of guarantee is to
enable a person to get a loan, or goods on
credit or an employment
 Mutual assent is an essential element of a
contract of guarantee. It is not a unilateral
contract. There must be an offer and acceptance.
Surety: Person who gives the guarantee.
Principal Debtor: Person in respect of whose
default the guarantee is given.
Creditor: Person to whom the guarantee is given.
A takes a loan from B when C guaranteed
repayment of the loan. A is the principal debtor,
B the creditor and C the surety.
• Principal contract between the principal
debtor and the creditor.
• Secondary contract between the creditor and
the surety.
ESSENTIAL FEATURES OF GUARANTEE
1. Principal debt: The purpose of a guarantee
being to secure the payment of a debt, the
existence of a recoverable debt is necessary.
2. Consideration: Should also be supported by
some consideration.
3. Misrepresentation and concealment:
• Guarantee obtained by misrepresentation,
invalid.
• Guarantee obtained by concealment,
invalid.
ESSENTIALS:
• It is a contract
• To perform the promise or
• To discharge the liability
• Of a third person
• In case of his default
• The contract may either be written or oral.
Differences between Contracts of Guarantee
and Indemnity:
1. In case of Guarantee there are 3 parties. In
case of Indemnity 2 parties
2. In case of Guarantee there is a Principal
debtor. In Indemnity an original and direct
engagement; independent of the existence
of the third party
3. Guarantee exists for the security of the
creditor. Indemnity is for reimbursement of
loss
 BAILMENT
Bailment from bailler (French) meaning to
deliver. Signifying a contract resulting from
delivery.
A situation in which the personal property of
one person (a bailor) is entrusted to another (a
bailee), who is obligated to return the bailed
property to the bailor or dispose of it as directed.
Bailment implies a sort of relationship in which
the personal property of one person temporarily
goes into the possession of another. The ownership
of the articles or goods is in one person and the
possession in another e.g. leaving a car for repair,
cloth to a tailor, parcel to TCS, goods in a cold
store.
The delivery of goods by one person the bailor to
another the bailee for some purpose, upon a
contract that they shall, when purpose is
accomplished, be returned or otherwise disposed
of according to the direction of the person
delivering it.
Formed by the delivery of personal property,
without transfer of title by bailor to a bailee
usually under an agreement. Obligations and
duties arise from the bailment relationship.
CHARACTERISTICS:
1. Delivery of goods. Delivery of possession is
essential. Not transfer of ownership; that would
be sale or exchange. Distinguished from a mere
“custody.”
2. Delivery of possession is temporary but it is
for some purpose. Bailor reserves right to
claim redelivery of goods deposited. Delivery
should be upon contract.
3. Delivery should be upon some purpose:
When the purpose is accomplished goods
will be returned to the bailor or disposed of
according to his mandate. Delivered goods
to be returned according to directions of
bailor when purpose accomplished.
4. Only movable properties can be bailed.
RIGHTS AND DUTIES OF BAILEE and
BAILOR.
DUTIES of BAILEE:
• Take care of the goods entrusted to him –
reasonable.
• Not to make unauthorized use of goods
entrusted to him. Becomes responsible for
any loss.
• Not to mix goods with his own goods
• Not to set an adverse title to the goods
• Return the goods after purpose or period of
bailment is over.
DUTIES of BAILOR:
• To disclose defects of goods bailed
• To bear extraordinary expenses
• Compensate or indemnify for reasons not
entitled to make bailment
AGAINST THIRD PARTIES:
If use or possession wrongfully deprived by third
party bailee can claim damages. Option also with
bailor.
TERMINATION:
• Bailee wrongfully uses or disposes goods.
• Period or purpose of bailment over
• Gratuitous bailment terminated any time by
bailor
• On death of bailor or bailee gratuious bailment.
KINDS:
1. Deposit. Delivery of goods by one man to
another to keep for the use of the bailor.
2. Goods lent to a friend gratis to be used by
him.
3. Hire. Goods lent to the bailee for hire, i.e.,
in return for payment of money.
4. Pawn or Pledge. Deposit of goods with
another by way of security for money
borrowed.
5. Delivery of goods for being transported etc.
or something to be done about them, by the
bailee for reward.
PLEDGE : A special kind of bailment, in which
personal property is turned over to the creditor
as security for the payment of a debt and
retained by the creditor until the debt is paid.

The chief basis of distinction with

bailment is the object of the contract where the
object of the delivery of goods is to provide a
security for a loan or for the fulfillment of an
obligation.
 AGENCY
A relationship between two parties in which
one party (the agent) agrees to represent or
act for the other (the principal). The emphasis
is on the power of the agent to represent his
principal in dealings with third persons.
Since it is not possible for every person to
do everything by self, he allows the person to
be represented in the performance of person’s
legal acts by another and gives acts done by
such representative the same effect as they
would have done it by self.
One of the most common, important and pervasive
legal relationship is that of the agency; relationship
between (agent) who agrees to represent or act for
the other (principal). The principal has the right to
control the agent’s conduct in matters entrusted to
the agent, and the agent must exercise its powers
for the benefit of the principal only.
The principal, by using agents, can conduct
multiple business operations simultaneously in
various locations e.g. corporate officer.

AGENCY:
A legal relationship between a person and
another called the principal for whom he acts.
There must be an authority from the principal,
express or implied.
Is founded upon a contract, either express or
implied, by which one of the parties confides to the
other the management of some business to be
transacted in his name and on his account and by
the other assumes to do business and to render an
account of it.
Agent a person employed to do any act for
another or so represent the other in dealings with
the third person.
Principal the person for whom such act is done
or who is so represented.
In every transaction of agency three persons,
agent, principal and third party to whom such
representation is made, are involved.
 Sub Agent a person employed and acting
under the control of the original agent. He is not
responsible for his acts to the principal. He is only
responsible to the agent.

CREATION :
1. By Direct Appointment when agents authority
is expressly given
2. By Implication when agency is inferred from
dealings between two persons.
3. By Necessity when an emergency acts without
authority
3. By Estoppel (a plea in bar, grounded on one’s own act).
Principal induces third person that the acts done by his
agent are by his authority.
4. By Ratification when a previous unauthorised act is
approved and made valid.

TERMINATION:

BY ACT OF PARTIES:
• Lapse of Time: Period for agency relationship expires.
• Purpose Achieved
• Occurrence of Specific Event
• Mutual Agreement

BY OPERATION OF LAW:
• Death or mental incompetence. Automatic and immediate.
Knowledge of death not required.
DUTIES OF PRINCIPAL TO AGENT:
1. Indemnify him against all lawful acts done in
exercise of conferred authority
2. Indemnify for acts done in good faith.
3. Compensate for injury caused by principal’s
neglect

RIGHTS OF AGENTS:
4. Right of retainer out of sums received on
principal’s account
5. Entitled to commission (subject to contract)
6. Entitled to retain property, documents etc.
until commission due received
1. Indemnified by principal for lawful acts
2. Indemnified by principal for acts done in good
faith.

RIGHTS OF PRINCIPAL:
3. Agent to carry out business according to
principal’s directions as a prudent man.
4. Entitled to examine accounts.
5. Agent to obtain instructions from principal
6. Can repudiate transaction if agent carries out
business in his own account.
7. Agent cannot delegate authority without
consent.
V.I.P

R.I.P
PARTNERS
 LAW RELATING TO PARTNERSHIP
• In Pakistan for small to medium size business
set ups the common mode of business.
• Advantage of structural flexibility and
formality of relationship between partners.
• Maybe registered or not. Not compulsory
• Registered firms have the advantage of tax
and consequences of litigation.
• Favoured over corporate structure
(companies) as no dividend is levied.
• But partners exposed to greater personal
liability than the shareholders of a company.
 PARTNERSHIP LAW IN
PAKISTAN
PARTNERSHIP ACT 1932
Originally it was contained in and formed
part of the Contract Act,1872 (Chap. XI)
which was repealed and in its place was
passed a comprehensive law.
• Is the law governing regulation of
partnerships in Pakistan.
• Law passed by the Indian Legislature in
1932.
• The Governor General of India gave
assent on April 8, 1932.
• No. IX of 1932
• Adopted and followed by the Government
of Pakistan
SCHEME OF LAW:
• Divided into 8 Chapters
• Sections 74
• Schedule 1
CHAPTERS:
1. Preliminary
2. The Nature of Partnership
3. Relations of Partners to One Another
4. Relations of Partners to Third Parties
5. Incoming and Outgoing Partners
6. Dissolution of a Firm
7. Registration of Firms
8. Supplemental

SCHEDULE:

Fees Prescribed
 DEFINITIONS
• Intention to economize words
• Does not lay down general principles
• With reference to the whole Act and with
reference to the content

PARTNER:
• One who partakes or shares with another
• An associate
• One who has a share with another or
others in some commercial,
manufacturing or other undertaking
• One who dances with another.
• An associate in a firm. A member of a firm or
partnership.

PARTNERSHIP:
• The state or condition of being a partner
• The association of two or more persons for the
purpose of undertaking and prosecuting
conjointly any business, occupation, or calling
• That which subsists between persons who have
agreed to combine their property, labour skill in
some business and to share the profits thereof
between them
• A type of business entity in which partners share
with each the profits or losses of the business.
FIRM:
Persons who enter into partnership are
collectively called a firm
Persons who enter into partnership with
one another are individually ‘partners’ and
collectively a ‘firm’ and the name under
which their business is carried on is called
the ‘firm name’
Partners may choose any name as their
firm’s name provided it does not go against
the rules relating to trade name or
goodwill----mislead the public into confusing
with a firm already in existence or words
which express or imply sanction, approval or
patronage of the Government
‘BUSINESS’:
• Includes every trade, occupation and
profession.
• Includes and not Means.
• An Inclusive and not Exhaustive definition
• General and vague
• Broadly, any activity which, if successful,
would result in profit
• Must be in existence
• May be temporary or permanent
(indefinite)
PARTNERSHIP:
The relation between persons who have
agreed to share the profits of a business
carried on by all or any of them acting for all
• Persons who have entered into partnership
with one another are individually called
‘partners’ and collectively a ‘firm’ and the
name under which their business is carried
on is called the ‘firm name’
• A voluntary act between two or more
persons.
• Placing their money, effects, labour and
skill, or some or all of them
• In lawful commerce or business
• Understanding that there shall be
communion of profits or thereof between
them.
• Contains the following
elements/essentials
ESSENTIALS:
• Association of two or more persons to
carry on a business
• An agreement entered into by all
concerned
• Agreement must share the profits
• Business must be carried on.
• Carried on by all or any of the persons
concerned acting for all.
• All elements must be present before a
group of persons can be called partners.
Only then a partnership can be said to
come into existence.
• Elements may appear to overlap but are
distinct
• Existence of partnership is a question of
fact.
Association of two or more persons:
• There must be at least two persons who
should join together to constitute a
partnership.
• A group of persons with no legal relations
(no mutual rights and liabilities) not a
partnership
• No existence or responsibility separately
from its partners.
 An Agreement:
• Entered into by all persons concerned
• Partnership arises only as a result of an
agreement, express or implied
• Created by a contract, it does not arise
by operation of law e.g. joint operation
(heirs on death )
• Voluntary contractual
• Lawful agreement; founded on good
faith, for lawful object between
competent persons. Fulfill all the
essentials of a valid contract.
• Can even come into being upon an oral
agreement
Sharing Profits:
• Must be an agreement to share profits
arising out of the business
• An essential element of partnership
agreement
• Different from clubs, societies, charitable
associations etc.
• How to be shared left to the parties
themselves
• Sharing of losses not essential.
• Profits refer to net profits.
Carrying of Business:
• ‘Business’ as defined i.e. any trade,
occupation or profession.
• May be temporary or permanent
(indefinite).But must be in existence.
• Agreement to carry on business at a
future time does not result in present
partnership.
• Must be carried on by all or by any
concerned acting for all
• Business must be lawful
• Mutual agency
• True test of partnership.
• Partnership based on the idea of mutual
agency.
• Every partner assumes a dual role i.e.
that of a principal and agent.
• Action of each partner is binding on the
other; agent and principal.
• Liable to account for all.
• Contract in the name of the firm.
 PARTNERS....COMPETENT
• Can be entered into by every competent
person
• Attained age of majority
• Of sound mind
• Disqualified from any law to which he is
subject
• Unsound mind
• Married woman is competent
• Minor cannot become a partner but can
be admitted to benefits of partnership.
WORKING PARTNER:
• Not necessarily a partner in business
• Maybe only an employee
• Gets a share in the net profits
• Remuneration for services rendered.
 FIRM
Firm:
• Persons who have collectively entered
into partnership with one another is
collectively called a firm
• Name under which business is carried is
Firm Name.
• Business under any name or style
• Taking care of rules like trade name,
goodwill etc.
IMPLIED AUTHORITY:
• Important
• The act of a partner which binds the firm
• This authority of the partner which binds
the firm is his ‘implied authority’
• To exercise implied authority necessary
that:
1. Act must be done in the conduct of
business of the kind carried on by the
firm
2. Must be done in the way which is usual in
such business
3. Must be done in the firm name or in any
other manner expressing or implying an
intention to bind the firms

‘ACT OF A FIRM’
• Binds every one of the partners
• An act in which every one of them had
actually participated
• Gives rise to a right enforceable by or
against the firm
 ILLEGAL PARTNERSHIP
• Object of partnership is unlawful. Section
23 of Contract Act
• Number of persons entering into
partnership exceed the permitted.
Companies Law:
1. Business of banking—more than 10
2. Any other business—more than 20
• With an alien enemy (alien friend); enjoys
civil and personal rights as a citizen
• Against international comity.
 PARTNERSHIP....DISTINGUISHED
CO-OWNERSHIP
• Akin but different
• Partnership result of an agreement
• Mutual rights and obligations different
• Consent of all trade/business: Examples
• Transfer of interests

CLUB:
• Entirely different
• Club members not liable for acts of other members
• Not liable to be creditor of club
• Liability—extent of Club’s regulations
• No implied authority i.e. bind other members of the
club.

TRADE ASSOCIATION:
• Mutual agency does not exist
COMPANY:
1. Person---Legal
2. Creation– Legal formalities/agreement
3. Transfer of interest
4. Agents of others
 Cont’d.....
5. Liability to debts
6. Contract
7. Private arrangements
8. Number
9. Death—Dissolution
10.Property
11.Restrictions
12.Sue and be sued
13.Decree
14.Registration
15.Shareholder
1. PARTNERSHIP is not a distinct legal
person, but is made of the persons
composing it.
COMPANY is a distinct legal person

2. Creation of PARTNERSHIP is purely a

matter of agreement between the parties
such an agreement need not even be in
writing.
Creation of COMPANY involves elaborate
legal formalities
3. In a FIRM partner can transfer his
interest with the consent of other
partners.
Shares in a COMPANY (especially Public)
are generally freely transferable.
4. Each partner is prima facie the agent of
others, and can bind them by his contract
made in the course of business of the
partnership.
Shareholders in a COMPANY are not the
agents of one another.
5. Each PARTNER is liable in full for the
debts of the firm
The liability of the Company’s
shareholders is limited by shares or
guarantee.
6. A PARTNER cannot contract with the firm.
A shareholder in a COMPANY can contract
with the COMPANY.
7. PARTNERS may make any private
arrangements among themselves e.g buy
others’ shares.
Arrangements in COMPANY are regulated
by law e.g Company cannot buy its
member’s shares
8. In PARTNERSHIP maximum number of
members is restricted
In COMPANY no maximum number.
Minimum is prescribed
9. Death of a partner dissolves a
PARTNERSHIP
Death or retirement of shareholder does
not dissolve the COMPANY.
10.Property may be the common property of
PARTNERS.
Property belongs to the COMPANY and
not its members
11.Restrictions contained in partnership
deed will not effect third parties, who
are not aware of it
Restrictions in Articles of Association
effect third parties also.
12.A FIRM cannot sue or be sued.
A COMPANY can in its own name.
13. Decree against the FIRM can be
executed against the partners.
Decree against the COMPANY cannot be
executed against its shareholders.
14.For a PARTNERSHIP registration is
optional
For a COMPANY it is compulsory
15.A FIRM cannot be a shareholder. in a
company
A COMPANY can be a shareholder in
another company.
 PARTNERSHIP---EXISTENCE

HOW TO DETERMINE?
• Real relation between the partners
• Mainly a question of fact
• Onus to prove on the appellant
 PARTNERS—
RELATIONS TO
ONE ANOTHER
 PARTNERS—RELATIONS TO
ONE ANOTHER
• Relations between partners defined
• Freedom to arrange their own affairs
among themselves
• Mutual rights and duties regulated by
contract
Duties and liabilities on a partner:
1. Duty of good faith and common advantage
• Carry on business to the greatest common
advantage
• Just and faithful to each other
• Use knowledge and skill for benefit of firm
• Not personal advantage
• In case of loss to firm by fraud of a
partner---indemnify firm (make good the
loss)
2. Duty to render true accounts and full
information:
• Not to mix with personal business
• Disclose full facts.
• Rights and duties of partners determined
by contract between them.
• Contract varied only by consent of all
partners
• In conduct of business every partner has
RIGHT to:
1. Take part in conduct of business
2. Access, inspect and copy books of
account
3. Express opinion. Majority opinion
• Mutual rights and liabilities. Subject to
contract:
1. Not entitled to any remuneration
2. Entitled to share equally
3. Advance by partner to firm (over and
above capital) entitled to profit (interest)
PROPERTY OF FIRM:

Inclusive definition
1. All property and rights originally brought
to the stock of the firm
2. Acquired by purchase or otherwise
during the course of the business
3. Goodwill of the business
4. Rights and interests acquired with
money belonging to the firm. Deemed.
GOODWILL:
• Not defined
• “The whole advantage, whatever it may be,
of the reputation and connection of the firm”
• Intangible
• Easy to describe, difficult to define
• It is benefit and advantage of the good name,
reputation and connection of a business
• No independent existence
• Cannot subsist by itself
• Attached to business
• Attribute of a business, trade or profession.
APPLICATION OF PROPERTY:
• Shall be held
• Shall be used
• By the partners
• Used by the partners
• Exclusively for purposes of business
• Common benefit of all partners
• One partner cannot use assets for
personal benefits
PERSONAL PROFITS OF PARTNERS
• Subject to contract
• If a partner derives personal profits ----
transaction, use of property or
connection---of the firm. Shall account for
and pay to the firm
• Carries on any business----same structure
and competing with the firm. Shall account
for and pay profits made in that business.
• Cannot carry on competing business during
subsistence of partnership
• In that case pay to firm all profits.
RIGHTS AND DUTIES AFTER CHANGE IN
FIRM
General rules laid down for
determination of rights and duties of
partners. No effect on registration. Three
situations. In case of:
• Change in constitution: Rights and duties
remain the same as immediately before
change
• After expiry of term of firm, remain the
same
• Additional undertakings are carried out
1. CHANGE IN CONSTITUTION
• Partnership not dissolved
• Mutual rights and duties of partners
• Remain same in reconstituted firm
• Same as immediately before
reconstitution
2. AFTER EXPIRY OF TERM OF OFFICE:
• In spite of being constituted for fixed
term carries on business
• Term expired
• Mutual rights and duties remain the same
• Same as before expiry.
3. ADDITIONAL UNDERTAKINGS ARE
CARRIED OUT:

• Originally constituted to carry out one or

more undertakings
• Carries out other undertakings
• Mutual rights and duties in the new
undertaking same as in old
 PARTNERS—
RELATIONS TO
THIRD PARTIES.
 PARTNERS—RELATIONS TO
THIRD PARTIES.
Rights and duties of partners as regards
to third parties
PRINCIPAL AND AGENT:
• Agency is the essence of partnership
• Partner is both an agent and principal
• Relation between partners of principals
• To third parties agents of the firm
• Acting on behalf of firm can bind co-
partners
• Acting in personal capacity—personal
liability
IMPLIED AUTHORITY:
• Important
• The act of a partner which binds the firm
• This authority of the partner which binds
the firm is his ‘implied authority’
• To exercise implied authority necessary
that:
1. Act must be done in the conduct of
business of the kind carried on by the
firm
2. Must be done in the way which is usual in
such business
3. Must be done in the firm name or in any
other manner expressing or implying an
intention to bind the firms
Relevant factors:
• Nature of business
• Practice of persons engaged in it.

FRAUDULENT ACT—IMPLIED AUTHORITY?

• Liability of firm on fraudulent act of
partner
• Partner’s implied authority
• Factor—principal answerable for acts of
agent
• Firm liable
• Firm not liable if collusion between partner
and third party
• If third party bona fide then firm liable
IMPLIED AUTHORITY
ACTS OF THE PARTNER WHICH DO NOT
BIND
THE FIRM:
1. Submit dispute relating to firm’s business
for ARBITRATION.
2. Open on behalf of firm BANK ACCOUNT
3. Compromise/relinquish CLAIM (part) of
firm
4. WITHDRAW suit/proceeding filed on behalf
of firm
5. ADMIT liability in suit/proceeding against
firm
6. ACQUIRE immovable property on behalf
of firm
7. TRANSFER immovable property
belonging to firm
8. ENTER into PARTNERSHIP on behalf of
firm
May also include:
• Bind the firm by giving GUARANTEE in
respect of debts of third parties.
• SET off PERSONAL DEBTS against debts
due to firm.
• SET OFF DECREE obtained by firm for
less than the decreed amount
• ACCEPT FULLY PAID SHARES in
satisfaction of debts due to firm.
LIABILITY OF PARTNER
1. RIGHTFUL ACT:
Every partner jointly and severally
responsible
2. WRONGFUL ACT:
Wrongful act/omission during ordinary
course of Business loss to third party then
firm responsible
4. MISAPPLICATION:
Partner or firm misapplies money or
property
Received from third party firm is liable
5. HOLDING OUT:
Where a person by word or conduct
induces another to believe him and acts
accordingly he cannot subsequently deny the
existence of such facts
• Becomes personally responsible
• Does not become member in the firm
• Not entitled to any rights as against those
in the firm
• Does not become agent of the firm
MINORS (according to law)
Cannot be a partner
May be admitted to benefits of partnership
Cannot declare as partners but only that entitled
to benefits.
No partnership wholly of minors.
RIGHTS:
1. Admitted to benefit
2. May inspect/access accounts
3. Share property and profits
4. Sue for accounts on severing ties with firm
5. On attaining majority option of becoming
member
1. On attaining majority option to leave
2. Not personally responsible for acts of
firm

LIABILITIES:
3. Share liable for acts of firm. Within 6
months of majority can sever connection
4. On majority if a member then personally
responsible to third parties
5. Fails to give public notice he becomes a
member after 6 months.
 PARTNERS—
INCOMING AND
OUTGOING
 PARTNERS—INCOMING AND
OUTGOING
Partnership a contract based on good faith
implies that no new partner can be
introduced without the consent of all the
partners

INCOMING PARTNER:
• Subject to contract between partners
• Introduction subject to consent of all
existing partners
• Not liable to any acts of firm before
coming a partner
• Liability after becoming a partner
• A new partner usually has no personal
liability.
• Unless he expressly agrees
• Liability of a minor on becoming a
member from the time he was admitted to
benefits of partnership
OUTGOING PARTNER:
Leaves the firm. No longer a partner in
the partnership. Subject to contract not
entitled to benefits. Becomes outgoing by:
1. Retirement
2. Expulsion
3. Insolvency
4. Death.
RETIREMENT:
Three rules how a partner can retire:
• With the consent of all partners
• In accordance with an express agreement
by all partners
• Giving written notice to all to all partners
Liability on Retirement
• To third party for acts before retirement;
discharged by an agreement with third
party and reconstituted firm
• Otherwise liability continues until public
notice given

EXPULSION:
• Governed by contract
• Majority cannot expel except in good
faith
• Conferred by express agreement
• If conferred powers then exercised by
majority

Liability on Expulsion:
Same as in case of retirement.
INSOLVENCY:
The condition which marks a person’s
liability to meet full monetary obligations.
Ceases to pay debts in the ordinary course
of business or cannot pay as they become
due
• On being declared an insolvent ceases to
be a partner on the date of order
• Firm not necessarily dissolved depending
on the contract
• Firm automatically dissolved if all
partners (but one)declared insolvent
Liability:
• After insolvency estate not liable to any
act of firm
• Firm not bound by acts of partner

DEATH:
• If by agreement firm not dissolved on
death estate of deceased not liable to any
act of firm
• If by agreement firm dissolved surviving
members responsible till public notice
given
DISSOLUTION OF
FIRM
 DISSOLUTION OF FIRM
So far:
1. Formation of partnership
2. Nature of partnership
3. Rights and liabilities of partners
4. Partners inter se third persons.
5. Changes in a firm without dissolution i.e
reconstitution where business continues
as before.
• Literal Meaning:
Breaking Up.
• Of partnership:
 The discontinuance of a partnership
from any legal cause. Breaking up or the
extinction which subsisted between all the
partners of the firm. There are various ways
of dissolution of firm. It may take place:
1. AGREEMENT:
By agreement (consent) between all the
partners or according to the contract
amongst themselves
2. COMPULSORY:
Occurrence of events making dissolution
unavoidable e.g.
• Insolvency of all partners or all except
one (when only one remains then no
longer a partnership)
• Unlawful business. When object of
partnership is illegal and carrying on of
business becomes unlawful
3. CONTINGENCIES:
Activities for which firm constituted
coming to an end, it cannot function and
stands dissolved on its own death
• Expiry of the fixed term for which the
firm was constituted
• The undertaking or particular adventure
for which constitutes firm has been
completed
• Death of partner as partnership based on
personal relations
• A partner declared insolvent
4. AT WILL:
Any partner can give notice in writing to
all partners of his intention to dissolve.
Definite term not specified exists only during
pleasure of all partners.
Dissolution from date mentioned in
notice if not then from date of
communication of notice
5. BY COURT
Seven grounds in which the Court on any
can order dissolution on a suit filed by a partner
• Unsound mind: As it is necessary to protect
the interest of the insane and other partners
• Permanent Incapacity: Due to illness, mental
or physical but should be of permanent
nature, incapable of performing duties
• Conduct: Guilty of conduct to effect carrying
of business; moral turpitude, professional
misconduct. Connected with business and
damage it.
• Conduct: Willful and persistent breach of
agreements relating to firm or conduct
e.g. destroying old account books, false
in books of account etc. Mutual
confidence does not exist and
continuance not practical.
• Transfer of share: by a partner of his
whole share to a third party.
• Motive: Business cannot be continued
only at a loss as motive of every
partnership is profit
• Any other ground: just and equitable to
dissolve. Judicial discretion with regard
to circumstances and exigencies.
Liability for acts of partners:
• Liable to third parties until public notice
is given. Not to prejudice and protect
rights of third parties
• Right of business: Apply property of firm
in payment of debts and liabilities of firm.
Surplus to be distributed amongst
partners.
• Authority: of partners binding each other
continue in order to finish unfinished
business and complete dissolution.
Authority to wind up
• Settlement of accounts: Losses first paid
out of profits, then capital and lastly
partners individually on basis of sharing
profit ratio
Assets of firm first debts of third parties,
then partners ratably for advances
(distinguish from capital), followed by capital
and balance if any divided ratably
• Debts: Joint debts paid from property of
firm and separate from separate property of
firm
• Goodwill: It can be included in assets and
can be sold separately or along with
property of firm
 PUBLIC NOTICE

• By intimation to Registrar of Firms

• By publication in official Gazette
• In at least one vernacular newspaper
circulating in the district.
 REGISTRATION OF FIRMS
• Law provides for registration of firms but
has not imposed any penalties for non
registration
• Non registration does not partnership
agreement void
• Optional for a firm to get itself registered
or not
• Prudence dictates registration is
implications of non registration are
serious
• Non registration imposes certain
disabilities for enforcing claims in courts
• Each Province has its own Rules
• Registrars of firms appointed by the
Provincial Government and defines areas
of jurisdiction.

PROCEDURE:
1. Application by firm to Registrar of Firms
on prescribed form:
• Name of firm
• Place or principal place of business
• Names of any other place where business
is carried on
• Date on which each partner joined the firm
• Names and permanent address
• Duration of firm
Signed and verified by all partners.
Restriction on use of names like Government,
Jinnah etc.
Sending/submitting the application to the
Registrar of Firms in the area of jurisdiction.
Registration is only of a firm which is in
existence and not which has been dissolved.
Registration takes place after receipt of
statement (application) by Registrar and after
verifying all particulars filed and compliance
made makes an entry in the Register of Firms
Once a firm has been registered further
and subsequent changes like:
• Name and place of business
• Opening and closing of branches
• Name and addresses of partners
• Changes in and dissolution of a firm
Can be made by intimating the Registrar
who shall make an entry in the Register of
Firms
In case of a court order regarding a registered
firm the Registrar shall make consequential
entries in the Register
 The Register of Firms is open to
inspection by any person on payment of
prescribed fees
The entries and any subsequent changes
in Register of Firms is conclusive proof of
facts. Original documents filed with the
Registrar shall be the conclusive proof.
NON REGISTRATION:
Mentioned earlier is not mandatory and
does not make a partnership illegal but its
effects:
1. If firm not registered and person suing not
registered as a partner cannot bring a suit
to enforce a right arising from a contract
• Against the firm
• Against any past or present partner of
firm
2. No suit to enforce a right arising from a
contract shall be instituted by or on
behalf of firm against any third party
But this does not effect the right of a
third party to proceed against an
unregistered firm and its partners.
3. Claim to set off and other proceedings to
enforce any right arising from a contract.
BUT Non Registration does NOT effect:

1. Right of third party to sue firm or any

partner
2. Right of partner to sue for dissolution
3. Receiver to realise property of an
insolvent partner
4. Firm or its partners having no place of
business in Pakistan
 LIMITED LIABILITY PARTNERSHIP (LLP)

Partnership in which some or all partners

(depending on the jurisdiction) have limited
liabilities. It therefore exhibits elements of
partnerships and corporations. In an LLP, each
partner is not responsible or liable for another
partner's misconduct or negligence. This is an
important difference from the traditional unlimited
partnership under the Partnership Act 1932, in
which each partner has joint and several liability.
• United Kingdom: Limited Liability Partnership Act
2000
• India: The Limited Liability Partnership Act 2008
• Pakistan: Limited Liability Partnership Act 2017
• Several other countries with variations
Three forms of a business structure in
Pakistan:
a) Sole Proprietorship
b) Partnership
c) Limited Liability Company

• Partnerships traditionally have been

preferred by many business people for their
simplicity and flexibility.
• Partners are personally responsible for the
partnership’s liabilities.
• Limited Liability Partnership (LLP) are
business structures designed to help ease
this concern.
 FEATURES
• All partners are allowed to be involved in
the management of the LLP.
• The procedures of operation can be
spelled out in detail in the Limited
Liability Partnership Agreement.
Distribution of profits is also flexible.
• LLPs are often preferred by professional
service businesses, such as law firms,
accounting firms and financial service
firms. This is because partners of an LLP
are not liable for the negligence or
malpractice claims made against other
partners.
 Cont’d…..
• Does not require complicated legal and
procedural pre-requisites otherwise
acceptable for enormous and universally
held companies.
• A corporate body under which the right of
a partner to a share of profits is
transferable either wholly or partly.
• The transfer of any such rights will not
result in the dissolution of LLP.
• Provides for the conversion of firms
(including private companies) into LLPs.
 Cont’d…..
• To be taxed as partnerships but will have
the benefits of being corporate, separate
juristic entity, having perpetual
succession but distinct from its partners,
whereas traditional partnership lacks
such features.

Pros and Cons

1. Limited liability for the limited partners
in an LP. These partners can contribute
the capital in a partnership without
risking their personal assets.
 Cont’d…..
2. The liability is limited only for partners
who did not participate in creating the
problem or the debt.
3. There is no double taxation. Double
taxation happens in corporations because
the corporation pays income taxes on its
profits, and then uses the remaining
profits to pay dividends to shareholders,
who again pay their own individual
income tax on it. Thus, the same profit
gets taxed twice.
4. The shares in a partnership cannot be
publicly traded on the stock market.
 LIMITED LIABILITY PARTNERSHIP
Limited Liability Partnership Act. 2017.
• Chapters 13.
• Sections 55.
• Schedules 3.

Chapter 1: Preliminary
Chapter 2: Nature of Limited Liability
Partnership
Chapter 3: Registration
Chapter 4: Partners, Partnership and Their
Relations
Chapter 5: Extent of Liability
Chapter 6: Contributions
 Cont’d…
Chapter 8: Assignment and Transfer of
Partnership Rights
Chapter 9: Conversion to Limited Liability
Partnership
Chapter 10: Foreign Limited Liability
Partnership
Chapter 11: Compromise, Arrangement or
Reconstruction of Limited
Liability Partnerships
Chapter 12: Winding Up and Dissolution
Chapter 13: Miscellaneous
 DEFINITIONS
Body Corporate, includes:
i. Limited liability partnership registered
under this Act;
ii. Limited liability partnership registered
or incorporated outside Pakistan; and
iii. Company, incorporated outside Pakistan,
but does not include sole proprietorship,
cooperative society, any other body
corporate not defined as a company.

Commission:
Securities and Exchange Commission of
Pakistan
 Cont’d…
Foreign limited liability partnership:
A limited liability partnership that is
formed, registered or incorporated outside
Pakistan.

Limited liability partnership:

A partnership registered under this Act.

Partner:
In relation to a limited liability partnership,
means any person who has been admitted
as a partner in the limited liability
partnership in accordance with the limited
 Cont’d…
Separate legal personality:
Limited liability partnership shall be a body
corporate by registration under this Act and
shall be a legal entity separate from its
partners.
• Shall have perpetual succession.
• Any change in the partners of a limited
liability partnership shall not affect the
existence, rights or liabilities of the
Limited Liability Partnership.
• A limited liability partnership shall:
a) sue and be sued;
b) acquire, own hold develop or dispose
 Cont’d…
c) have a common seal; and
d) do and suffer such other acts and
things as bodies corporate may
lawfully do and suffer.

Contracts:
On behalf of a limited liability partnership
shall be made in writing under common seal
of the limited liability partnership and any
contract so made shall be effectual in law
and shall bind the limited liability
 Cont’d…
Partners, partnership and their
relations:
• Individual or body corporate or company
may become a partner in a limited
liability partnership.
• Shall have at least two partners.
• A person may cease to be:
i. In the event of his death
ii. Event of dissolution of limited liability
partnership; and
iii.In accordance with an agreement
• A limited liability partnership is its agent
 Cont’d…
Designated partners:*
• Every limited liability partnership shall
have at least one designated partner:
i. is an individual; and
ii. a resident in Pakistan
*A designated partner shall be responsible
for the doing of all acts, matters and things
as are required to be done by the limited
partnership in respect to compliance of the
provisions of this act including filing any
document, return, statement and the like
report pursuant of the provisions of this act
and as may be specified in the limited
liability partnership agreement.
 Cont’d…
Form of contribution:
Decided mutually by the partners and may
consist of moneys, negotiable instruments,
properties including valuable rights,
intangibles, knowledge and skills, etc.
which the partners deem to add value to
partnership.

Financial Disclosures:
• Shall maintain proper book of accounts;
prescribed by SECP
• Prepare a statement of accounts within
four months from the end of the financial
 Cont’d…
Conversion:
• From firm to Limited Liability
Partnership, Second Schedule will apply
• From private limited company to Limited
Liability Partnership, Third Schedule will
apply

Winding up and dissolution:

• Either voluntary or by the Court.
• Rules still to be made for winding up
 Cont’d…
Appeal:
Appeal against an order of the Registrar or
Commissioner will lie to the Appellate
Bench of the SECP.

* Provisions of the Partnership Act, 1932 (IX

of 1932) shall not apply to a limited liability
partnership.

* Application of company law on notification

by the government.
 Differences between Limited
Liability Partnership and
Partnership
• LLP and Partnership Firm are both the
types of business formations through
which Partnership business can be done.
• LLP is a new concept while Partnership is
an old concept.
• Under the partnership, each partner owns
a share of the business. Is less expensive,
is more customizable than a corporation.
Limited Liability Partnership has the
advantages of both Partnership and LLP
as it has the limited liability of the
Partners.
 Differences between LLP and
Partnership Firm
PARTICULA LIMITED LIABILITY
PARTNERSHIP
RS PARTNERSHIP

Registration It is registered under LLP It is registered under

under Act Act, 2017 Partnership Act, 1932

Registered LLP registration is done with Partnership registration is

to SECP done with Registrar of Firms.

One of the main difference

between LLP and Partnership
Since the partner and the firm
is about the liability of
is not considered as a
Partners Since the partner
separate legal entity. Hence,
Liability and the firm is considered as
Partners are personally liable
a separate legal entity. Hence,
for the unlimited amount of
the liability of the partners is
liabilities of the partnership
limited to the amount
invested in the LLP.
A number of  Minimum 2 and maximum
 Minimum 2 and no upper
partners and 20 partners can be the
limit for maximum number
requirement number of the partnership
of partners in LLP.
s firm
 Cont’d…..
PARTICULAR LIMITED LIABILITY
PARTNERSHIP
S PARTNERSHIP

LLP Agreement governs the Partnership Deed governs the

Agreement operation, management and operation, management and
between decision-making decision-making
partners methodologies and other methodologies and other
activities of the LLP. activities of the partnership.
• Shares can be easily
transferred to another
person after obtaining • Shares can be transferred
the required consent to another person after
from all the Partners in obtaining the required
an LLP. consent from all the
• The transferee cannot Partners in a Partnership.
Transferabilit • Transferability of the
become partner
y/ Conversion automatically. partnership a is a lengthy
• LLP cannot be converted process.
back to the partnership • Conversion of partnership
but can be converted to to LLP or Private Limited
Company is a burdensome
Private Limited process.
Company or Limited
Company easily.
No requirement of annual
 Cont’d…..
PARTICULAR LIMITED LIABILITY
PARTNERSHIP
S PARTNERSHIP

Registratio
Mandatory Optional
n

Charter
LLP Agreement Partnership deed
document

It can sue and be sued in

Contractual It cannot enter into
its name.
capacity contract in its name.

It has a separate legal Partners are collectively

Legal
status. known as firm, so there is
Status
no separate legal entity.
Name of Name containing LLP as
Any name
firm suffix
Can be held in the name Cannot be held in the
Property
of the LLP. name of firm.
 Cont’d…..
PARTICULAR LIMITED LIABILITY
PARTNERSHIP
S PARTNERSHIP

Perpetual
Yes No
Succession

Audit of
Mandatory Not mandatory
accounts

Partners are agents of

Relationship It has a separate legal firm and other partners
status. as well.
 SIMILARITIES
• In both the forms of business organisation,
partners are not the employees; rather they
are agents.
• Partners are entitled to remuneration, only if
it is provided in the agreement.
• No partner is allowed to carry on competing
for business without the prior consent of
other partners.
• The introduction of a new partner to the
partnership can be done, only with the
consent of the existing partners.
• In the case of insolvency of a partner, he/she
 COMPANIES
INTRODUCTION
‘Company’ brings to mind an organisation
concerned with marketing and collection of
payments for products and services.
Companies are a familiar part of everyday
life especially capitalist market economy
• Buy food supply gas, electricity,
telecommunications, banks, newspapers,
watch television
• Our concern is the legal entity which owns
the business.
• This type of organization is created by law
• Exists only by virtue of the law
• The idea is the separate personality of the
company as an artificial person capable of
owning property, being a party to
contracts, and being a claimant and a
defendant in the legal proceedings.
• The limited liability company is said to be
the greatest single discovery of modern
times, even less than steam or electricity
• Why? Because a huge proportion of
world’s wealth is generated by companies
• Companies used as a tool for running a
commercial enterprise
• Starting a business venture on such a
scale requires money which can be done
by raising a loan or inviting people to
contribute to the capital. The former is
expensive and the latter is resorted in
case of companies
• For running and for managing the
interests of the large number of investors
the company has a formal ‘constitution’
(Memorandum and Articles of
Association) which sets out the voting and
other rights of all the members
(shareholders) of the company; those who
 COMPANIES LAW
• COMPANIES LAW. Legal regime for
establishment and regulation of
companies in Pakistan
• SECP. Securities and Exchange
Commission of Pakistan for
administration of companies and
Registrar of Companies appointed by
SECP.
• COMPANY LAW IN PAKISTAN:
1. Companies Act 1913 was adopted in
Pakistan in Pakistan after 1947
2. Administered by Provinces till 1973 (new
Constitution) and then taken over by
Federal Government.
3. New law promulgated on October 8,
1984. Previous law repealed.
4. To cater for needs of expanding sectors
the law amended in 1991, 1999 and
2002.
5. Companies Act, 2017. Previous law
repealed.
 OBJECTIVES

OBJECTIVES OF COMPANIES LAW:

The entire scheme is meant to protect the

interest of the creditors and shareholders
and not to put their interest at risk by
interim arrangements.
The law has been enacted for the
purpose of regulating all matters relating
generally to all types of companies
 It encompasses all legal rules and
regulations for business registration with
SECP and is enforced by the agency. Provides
legal protection to business community of
Pakistan, with SECP keeping a close check on
financial and corporate entities to ensure
shareholders’ interest
• Healthy growth of the corporate
enterprises
• Protection of investors and creditors
• Promotion of investment
• Development of economy
 COMPANY:
CHARACTERISTICS
A company is an artificial person
created by law, endowed with a
perpetual succession and an entity
apart from its members. It signifies
assent by means of common seal. It is
capable of holding property, incurring
debts, and suing and being sued in the
same manner as an individual
Five core characteristics:
1. Legal personality/entity
2. Limited Liability
3. Transferable Shares
4. Centralized management under a board
structure
5. Shared ownership by contributors of
capital
• Granted a charter/permission
(incorporated) by the competent
authority (SECP/Registrar of Companies)
• A separate legal entity distinct from its
members is created with its own
privileges and liabilities
• It can sue and can be sued
• Creation of a specific law safeguarding
the interests of the stakeholders. Not to
put their interest at risk by interim
arrangement
• Management operate the company
• As they are ‘born when issued a
certificate of incorporation they also ‘die’
when they go bankrupt
 LIMITED LIABILITY
• If the company fails shareholders
normally only stand to lose their
investment and the employees their jobs
but neither will be further liable for debts
that are outstanding against the
company’s creditors.
• Can be convicted of criminal offence like
fraud, misstatements etc.
• If a company becomes unable to pay its
debts, the members of the company will
not have to contribute towards paying
the of the company’s
 debts out of their own private funds; they
are liable to pay only the amount they
have paid, or have promised to pay for
their shares. It thus encourages risk
taking.

LEGAL PERSON
• Entity separate from the persons actually
involved in it. This fictional legal person
owns the property of the business, owes
the money that is due to business
creditors and is unchanging even though
the people involved in the business come
and go.
 Lifting the ‘Veil of
Incorporation’
• Limited liability: only company is
responsible for its liabilities and its
shareholders are said to be protected by ‘a
veil of incorporation’.
• The shareholders are hidden from view and
protected from incurring liabilities.
• Circumstances were the ‘veil of
incorporation’ will be lifted and the
business treated as if it were being run by
its individual shareholders or directors.
• Lifting the ‘veil of incorporation’ can be
authorized by a court.
 Lifting the ‘Veil of
Incorporation’
• Court will look behind the company façade
in a number of different circumstances:
• company being used for a fraudulent
purpose
• evade legal responsibilities
• to ascertain if a company is owned by
an enemy in wartime.
• Corporate structure used to evade
contractual duties and engage business
under a cloak (veil).
 KINDS OF COMPANIES

Under the law three different types of

companies:
• Limited by shares
• Limited by Guarantee
• Unlimited liability

Two types of limited companies:

• A Private Limited
• A Public Limited (Listed and Unlisted)
1. Company Limited by Shares. Each person
becoming a member (shareholder) of the
company acquires one or more shares in
which the Company’s capital is divided.
His liability is limited to his share
holding.
2. Company Limited by Guarantee. Liability
limited by Memorandum of Association to
such amount as members may
respectively undertake to contribute to
the assets on being wound up .
3. Unlimited Company. More akin to a
partnership where each member liable to
all the debts of the company. He is free
from his liability at the end of the year
from his ceasing to be a member.
• May be registered under the Law as:
• Private: restricts number of members to
50, invitation to public to subscribe and
right to transfer its shares
• Public: Three or more persons associate to
form. Not Private deemed to be public
Listed/Quoted
Unlisted/Unquoted.
 A company limited by shares, whether
private or public, is the most common
vehicle for carrying out business in
Pakistan.

Single Member: Only one subscriber to

the Memorandum of Association. A private
limited company for all intents and
purposes of the Company Ordinance
 PRIVATE vs. PUBLIC
Differences:
1. Subscription
2. Transfer of shares
3. Members
4. Upper Limit of Members
5. Certificate of Commencement
6. Min. subscription
7. Prospectus or statement in lieu of
8. Filing of Accounts
9. Qualification of Auditors
10.Investment in associate company
11. Restriction on CEO
12.Statutory Meeting and Report

ADVANTAGES OF PRIVATE
COMPANY
(HANDOUT)
FORMATION
OF
COMPANIES
 FORMATION OF COMPANIES
Usually it takes a lot of funding and
tons of efforts to establish a business. For a
company to be formally and properly
established several steps need to be
undertaken.
•PROMOTION: in which the promoters of
the company have to formulate and file all
the necessary documents with the Registrar
of Companies
•INCORPORATION: or the carriage of the
formal registration process of the company
that gives it a recognizable status in the
formal business sector.
• RAISING OF CAPITAL: this facilitated by
incorporation as it gives credibility and
makes the company eligible for being
granted loans as capital
• The official start of the business is the end
of the elementary steps of forming a
company but is the beginning of the
company’s interaction with its clientele.

For formation of companies in Pakistan

Secp.gov.pk
‘PROMOTERS’ GUIDE”
1. PROMOTION: Preliminary organizational
and promotional undertakings---
particularly obtaining capital for the
future/proposed company
• Persons who assume the task of
promotion are called promoters; maybe
individuals, syndicate, association etc.
• Promoter is less a term of law and more
of business.
• He has the desire that the company be
formed and is prepared to take the
required steps.
Promoters are the persons who take
procedural steps to set up a company and
who make business preparations for the
company. They are responsible for
registering the necessary documents with
the Registrar of Companies and have a
general duty to exercise reasonable care
and skill and a fiduciary duty towards the
company.
2. REGISTRATION:
• The legal process of incorporation.
Preparation and submission of necessary
documents and deliver them to Registrar of
Companies.
1. File an application to the Registrar of
Companies for availability of name. The
Registrar of Companies then issues a
certificate reminding that the proposed name
is available. This is to ensure against
duplication and deception
2. File Memorandum and Articles of association
with the Registrar of Companies in the
Province where the proposed company is to
be
 incorporated along with other prescribed
forms.
3. On registration the Registrar issues a
Certificate of Incorporation and a private
limited can commence business
immediately.
4. A public limited company can commence
business only after a Certificate of
Commencement of Business is issued by
the Registrar
5. A public limited company intending to
have its shares listed must obtain
permission from the relevant Stock
Exchange
3. FLOATATION:
• When a company has been registered and
has received its certificate of
incorporation it is ready for floatation; can
go ahead with raising capital to
commence business and carry it on
satisfactorily. This involves:
• Issuance of Prospectus (invite public to
subscribe)
• Submit statement in lieu of prospectus(if
capital to be raised privately)
• Certificate of Commencement: essential
for every public company.
• MEMORANDUM OF ASSOCIATION.
Sets out the constitution of the Company.
The foundation on which the Company’s
structure is based. Defines scope of
activities. Tells what it does spelling out its
objectives
1. Name
2. Province of registration.
3. Objects
4. Limited by shares or guarantee

A STATEMENT OF THE OBJECTS OF THE

COMPANY, ITS POSITION AND ITS
RELATION TO THE WORLD WITHOUT
• ARTICLES OF ASSOCIATION
A document regulating the rights of the
member of company among themselves. The
manner in in which the business of the
company shall be conducted. Dealing with
the whole internal arrangement of the
Company.

Originally framed when the Company

incorporated. Subsequent changes by special
resolution

RULES AND REGULATIONS PRESCRIBED

FOR THE INTERNAL MANAGEMENT OF A
COMPANY.
 PROSPECTUS
• A document which invites persons to take
shares in a company and set forth the
advantages of the company. Contains the
information for invitation of subscription
from the public
Any notice, circular, advertisement or
other intimation, offering to the public for
subscription, or purchase of any shares or
debentures of a company
1. Discussed and approved by the Board of
Directors
2. Public companies issuing prospectus
required to file application to SECP for
approval of prospectus for publication.
Prospectus to include:
• Memorandum
• Number of shares fixed
• Particulars of directors and managers
• Minimum subscription before allotment
• Number and amount of shares and
debentures
• Particulars of vendors
• Auditors
• Interest of every director
LIABILITY OF PERSON ISSUING
PROSPECTUS IF IT IS NOT ACCORDING
TO PROVISIONS OF LAW.
 SHARE CAPITAL

The share capital of a Company goes

under different names;
1. Authorised Capital: stated in the
Memorandum of Association and which
the company is authorised to issue
2. Issued Capital: The full authorised
capital may not be initially issued; it is
that capital that has been issued
3. Paid Up Capital: that part of the issued
capital which has been actually paid for
by the shareholders.
 SHARE CAPITAL & SHARES
A share signifies:
1.
• The interest of a shareholder in a company
• Right to receive dividend
• Vote at the meeting
• Share in surplus of assets (if any) on
winding up
2. Liability in the company to pay on call until
shares fully paid up
3. Right to transfer subject to provisions of
Articles of Association.
4. A binding agreement between the
company and shareholder as spelt out in
the Articles of Association.
SHARE OF A COMPANY IN THE HANDS
OF A SHAREHOLDER SIGNIFIES A
BUNDLE OF RIGHTS AND
OBLIGATIONS
 SHARES

• Prospectus: Invitation to the public to

make offers to the company
• Application: from the public is an offer to
take them
• Allotment: acceptance of the offer by the
company creating a contract between the
parties
• Allotment complete when notice of
allotment issued.
• Registered: Name of share allottee is
entered in the Register and becomes a
member of the company
• Shareholder : The person who holds a
share by having his name on the
register.
• Distinctive number for each share
Transfer: The making over to another
the document(shares in
public companies) by one to
another. An act of a member.
Transmission: By devolution of law e.g. by
death, bankruptcy etc.
PROCEDURE:

• Apply: Transferor or transferee to the

Company
• Checking and Verification: By the
Company
• Notice: Maybe issued by Company
• Processed
• Approval: BOD or Committee of BOD
• Register of Members: Entry and Delivery

Normally transfer of shares is not

refused by Company (defective/invalid)
MANAGEMENT
 MANAGEMENT
• ARTICLES OF ASSOCIATION: Rules and
Regulations drawn up for the conduct of
a Company.
• DIRECTORS
1. First Directors determined in writing by
majority of subscribers of the
memorandum
2. Hold office till first AGM
3. One who directs a business
4. Persons of the select body of
shareholders of a Company
5. Delegated duty to manage affairs of the
Company
6.Trustees of Company’s assets
7.Not trustees of individual shareholders
8.Enters into contract on behalf of Company
9.Number of Directors:
• SMC: At least one
• Private: Not less than two
• Unlisted Public: Not less than three
• Listed Public: Not less than
seven
• Public interest company: Female
representation
on their board

DIRECTORS’ REPORT.
Attach with every Balance Sheet:
2. Recommendation for dividend
3. Re-appropriation of profits
4. Disclose material changes
5. Explanation on any adverse remarks of
auditors.
CHIEF EXECUTIVE
• An individual entrusted with powers to
manage to affairs of the Company
• Subject to control and direction of
directors
• Includes a director or any other person
• First appointment within 15 days of
 commencing business by Directors. Hold
office till first AGM
• Subsequent by the BOD within 14 days of
vacancy
• Till successor appointed continues to work
• ‘Conflict of Interest’; directly or indirectly
engage in any business which directly
competes with the business of the Company.

SECRETARY:
• An officer of the Company
• Responsible for the compliance by the
Company of its statutory duties
• Public company must have a company
Secretary
• Prescribed qualifications under the Law
AUDITORS:
• To carry out ‘audit’ an examination of
accounts which may be detailed or
administrative.
• Comply with directions
• Appointed at each AGM
• Hold office till conclusion of next AGM
• Removal through Special Resolution.
• Duties of auditor have been late down…..
Conduct audit on ISA (as adopted by
ICAP)
 COMPANY MEETINGS
STATUTORY MEETING
• Every public company with share capital hold
meeting within 180 days from the date entitled
to commence business or within 9 months of
date of incorporation which ever is earlier.
• If first annual general meeting is held earlier
then statutory meeting is not required.
• Held once in a lifetime
• Purpose to put before shareholders all important
facts – shares taken up, monies received,
contracts entered, preliminary expenses
• Furnish particulars for shareholders to discuss
• Management, method and prospects
STATUTORY REPORT: Report submitted by the
directors 21 days before the Statutory Meeting
to every member

ANNUAL GENERAL MEETING:

• First meeting within eighteen months of its
incorporation
• Subsequent once at least in one year, within
four months close of financial year
• At it consider accounts ,B.S. Profit and Loss
Account, Auditors and Directors Reports.
• Declaration of dividend
• Appointment /remuneration of auditors
• Election/appointment of directors.
EXTRA ORDINARY GENERAL MEETING
• All general meetings other than Statutory
or AGM
• Conduct special business
• Called in three ways:
1. Directors on their own initiative
2. By the directors on requisition by
shareholders
3. By those requisitioning it

MEETING OF BOARD OF DIRECTORS:

• Quorum
• Minimum number of meetings
 RESOLUTIONS
Any proposal at a Company Meeting
and put to the vote
• Ordinary: decided by a bare majority
• Extraordinary or Special: requires a
majority of three-fourths to carry it
• Resolution by Circulation: Urgent, cannot
wait for next BOD
 AUDIT AND ACCOUNTS
It is mandatory for every company to maintain
proper books of account. Maintained for:
1. Cash receipts and payments i.e. Cash Book
2. Revenue and expenditures
3. Assets
4. Liabilities
5. Cost accounting records
• Books to be kept at Company’s registered office
• Can be inspected by Directors during business
hours in office
• If members wish to inspect then the place,
time, conditions etc. are determined by
directors
• Company auditors has right of access to books
of accounts
• Auditors duty to make a report to the members
of the company on the books of account
• Registrar of Companies can inspect books for
reasons recorded in writing
• Authenticated: B.S. P/L Ac approved by
Directors

INTERNAL AUDIT:
• Listed Company to have internal audit function
• Audit Committee of the BOD
WINDING
UP
 WINDING UP
• Artificial Person. ‘Born’ has to ‘die’
• Winding up is the closing up of a
company’s concern, which may be by
reason of insolvency, or otherwise
• Winding up is a proceeding by means of
which the dissolution of a company is
brought about and its assets realised and
applied in payment of its debts, and after
satisfaction of the debts, the balance, if
any, remaining is paid back to the
members in proportion to the contribution
made by them to the capital of the
company
Modes of winding up:
1. Compulsory winding up by the Court e.g.
special resolution by the Company,
defaults (statutory reports etc.), unable to
pay debts, violation of Company’s
Ordinance, Memorandum of Association
etc.
2. Voluntary winding up by:
a) Members
b) Creditors
3. Voluntary winding up under the
supervision of the court
• BANKRUPTCY: In it the whole estate, both
legal and equitable, is taken out of the
bankrupt and is vested in the trustee
• WINDING UP : The estate, legal or equitable,
still remains in the company until its
dissolution
• DISSOLUTION: Puts an end to the existence
of a company i.e. completely wound up or
court feels that official liquidator cannot
proceed with the winding up
• LIQUIDATION: Process of distributing a
bankrupt’s estate i.e. realising the assets and
paying the money over to the creditors.
 SALE OF GOODS ACT, 1930
Initially the Sale of Goods Act , 1930
was part of the Contract Act 1872 (Chapter
VII Sections 76 to 123).This Chapter VII was
repealed and a new law Sale of Goods Act
1930 promulgated. Pakistan adopted it in
August 1947.

The Sale of Goods Act has:

Chapters 7
Sections 66
Chapter I:
Preliminary (Sections 1-3)
Chapter II:
Formation of the Contract (Sections 4-17)
Chapter III:
Effects of the Contract (Sections 18-30)
Chapter IV:
Performance of the Contract (Sections 31-
44)
Chapter V:
Rights of Unpaid Seller Against the Goods
(Sections 45to 55)
Chapter VI:
Suits for breach of the Contract (Sections
55-61)
Chapter VII:
Miscellaneous (Sections 62-66)
 A contract of sales of goods is a contract in
accordance to which the seller either
transfers or agrees to transfer the property
in goods to the buyer for a price. The
payment of price is very important. Maybe
absolute or conditional. Maybe between one
part owner and other.
• Existence of goods, which form the subject
matter of the sale.
• The contract (bargain), when executed, will
result in the passing of the property in the
goods for a price.
• The payment or promise of a price
• The passing of the title.
 ESSENTIALS
The expression ‘Sale of Goods’ is a
composite expression consisting of various
elements and if one of them is missing there
is no sale. Briefly these are:
SALE:
is the passing of title from the seller to
the buyer. Title is the formal right of
ownership of property. The price is payable
in money. For a sale to be valid:
• Parties competent to contract
• Mutual assent
• Transfer of property
• A price may be paid or promised.
GOODS
The item of property must be tangible and
moveable. Tangible property has physical existence.
Goods mean every kind of moveable property
other than actionable claims and money and
includes stock and shares, growing crops etc.
Actionable claims and money cannot be bought and
sold. Money is recognised currency in circulation
but not foreign. Actionable claims is a thing which a
person cannot make use or enjoy e.g. a debt; which
can only be recovered through a suit.
KINDS:
1. EXISTING: Either owned or possessed by the seller
at the time of contract (e.g. agent). Subject goods
must be in actual or possible existence
• Specific: Identified and agreed upon at the
time of contract. Actually identified,
• Ascertained: Wider import than specific.
Become ascertained subsequent to the
contract
• Unascertained: Not specifically defined but
defined only by description.
2. FUTURE: Seller does not own or possess at
time of contract but he will manufacture,
acquire, or produce after making the
contract. Actually an agreement to sell . Sale
only of goods where ownership.
3. CONTINGENT: Sale dependent upon a
contingency which may or may not happen.
This may be absolute or conditional.
PRICE:
• No sale can take place without a price.
• If no valuable consideration for voluntary
surrender of goods then it is a Gift.
• Means money and nothing else.
• Money actually paid or promised to be paid
• Cash or credit sale
• If consideration other money then no sale.
FIXING PRICE: Either be certain and definite or
determinable by some method of calculation or
prescribed criterion.
Modes:
• Expressly stated in the contract. Parties free
to fix any price.
• Manner provided in the contract
• Determined in the course of dealings
between the parties.
• When nothing then when contract
executed then ‘reasonable price’
• To be fixed by the valuation of third party
provided the third party accepts.
Payment, subject to contract, in
currency of the country.
EARNEST MONEY. Part payment in advance
for due performance of contract. If contract
honoured then adjusted against price
otherwise forfeited by seller.
SALE : AGREEMENT and CONTRACT

1. Executed, Executory. Sale is an executed contract

i.e. sale plus conveyance.
2. General and Particular property. In sale transfer of
property with rights. In agreement a remedy only.
3. Damages: In agreement right of damages only
while in sale when ownership passed seller can
sue.
4. Right to resell: Seller at liberty to sell in
agreement.
5. Risk of loss: In agreement of seller and in sale of
buyer.
6. Remedy: In agreement buyer only personal
remedy i.e. damages. In sale buyer has personal
remedy and to the goods which seller has.
7. Insolvency: Seller becomes insolvent buyer
can claim rate able dividend. If permanently
insolvent entitled to recover goods from
official receiver.

AGREEMENT: Transfer of property to take

place at a future time or subject to
fulfillment of some conditions. It
becomes a sale when time elapses or
conditions fulfilled.
IN SALE OWNERSHIP OF GOODS
HAS PASSED TO THE BUYER. IN
AGREEMENT OWNERSHIP HAS NOT
PASSED TO THE BUYER.
TITLE and OWNERSHIP—TRANSFER

• Between seller and buyer

• If ownership passed on to buyer then loss
is buyer’s risk even if goods in seller’s
possession.
• Creditor of seller of goods has no claim
once the title has passed on to the buyer.
• Buyer cannot acquire a better title to the
goods than the seller
• If stolen goods bought buyer acquires no
title
• Seller should be owner of goods or
selling under authority of owner.
 AUCTION SALES:

• Each lot is a separate contract.

• Sale complete with ‘fall of hammer’
• Seller cannot bid
• Pretended biddings render sales voidable
at the option of buyer

AUCTION—IMPLIED WARRANTIES:
• Authority to sell.
• No defects in knowledge
• Undertakes to give possession against
price paid
• Possession will not be disturbed.
 CONDITIONS AND WARRANTIES:
Various statements, commitments and
performance make up a contract. Some are vital to
the contract and others subsidiary. If the parties to
a contract regard the term as essential it is a
condition and if not then it is a warranty.
CONDITION:
A qualification, provision, or clause in a
contract, the occurrence of which creates,
suspends, or terminates the obligations of the
contracting parties.
It is essential to the main purpose of the
contract. Breach of which gives right to treat the
contract as
repudiated. Has option to treat condition as
warranty and claim damages.
WARRANTY:
A stipulation collateral to the main
purpose of the contract, the breach of it gives
rise to claim for damages but not to reject
goods and repudiate the contract.
Conditions and Warranties are either
expressed or implied.
IMPLIED CONDITIONS:
• In case of sale seller has a right to sell
goods. When agreement to sell right when
the property is to pass
• When sale of goods by description then the
goods should correspond with the
description and of merchantable quality
• When description accompanied by sample
then the goods should correspond
accordingly.
• When particular purpose expressed by buyer
then goods should be fit for such purpose
• When sold by sample then bulk should
correspond with sample
IMPLIED WARRANTIES:
• Buyer has right of possession and free from
any encumbrance.
• Quality for particular fitness annexed.
 Difference between condition
and warranty
CONDITION WARRANTY

1. Stipulation essential to 1. Stipulation collateral to

the main purpose the main purpose of the
2. Breach of condition, contract
contract can be 2. Breach of warranty the
repudiated aggrieved party can
3. A breach of condition claim damages only
may be treated as 3. A breach of warranty,
breach of warranty. cannot be treated as a
breach of a condition.
 CAVEAT EMPTOR

Buyer—Beware. Sale of goods open to

inspection. The seller need not point out any
defect in them, but if he is asked about any
defect he must truthfully give out. Based on the
general rule that ‘there is no implied condition
or warranty as to the quality or fitness for any
particular purpose of goods supplied under a
contract of sale'. The buyer relies on his own
skill and judgment when he makes a purchase.
It is for him to satisfy about the purchase;
exceptions:
• When particular purpose intimated by the
buyer to the seller then seller to supply
accordingly.
• When bought by description goods should
be of merchantable quality.
INTELLECTUAL PROPERTY LAWS
Intellectual property is generally taken to
describe all those things which emanate from the
exercise of the human brain,

such as ideas, inventions, poems, designs, etc.

Consider the rights and the protection of these
rights that exist over such things as patents,
copyright and trademarks.
 Cont’d
These rights in the main give to the owner of the
rights a monopoly right to enjoy the benefits of the
invention or the trademark or the writing for a
particular period of time. These laws give rights to
the owner of the intellectual property so that he may
get the benefit from the time and money that he has
expended in producing the item.
Usually there will be an overlap of intellectual
property; a person may have invented a particular
machine and therefore he will obtain a patent in
respect of that invention; drawings of the machine
and so he will then own the copyright in those
drawings. Trademark which will link the machine
with his business so that members of the public,
when they purchase the machine, can identify the
 Cont’d

The Trade Marks Ordinance, 2001 (XIX of 2001)

The Copyright Ordinance, 1962 (XXXIV of 1962)
The Patents Ordinance, 2000 (LXI of 2000)
The Registered Designs Ordinance, 2000 (XLV of
2000)
The Registered Layout-Designs of Integrated
Circuits Ordinance, 2000 (XLIX of 2000)
Intellectual Property Organisation
A weak Intellectual Property (IP) regime has
been one of its biggest barriers to trade. Intellectual
property Rights (IPRs) are strengthened new
economic players will automatically enter into
investment arena, there is a need to build
institutions which demonstrate the capacity and
ability to develop direct, promote, and primarily
influence the IP environment of Pakistan.

Until 2005 Pakistan’s Intellectual Property

Offices – Trademarks Registry, the Patent Office and
the Central Copyright office were controlled by
three different ministries:
• Ministry of Commerce
• Ministry of Industry and
• Ministry of Education
 Cont’d
In order to establish an autonomous body to
harmonise the operation of the IP offices, the
government Intellectual Property Organisation of
Pakistan Ordinance 2005; whose main features were:

• The Trademarks Registry, the Patent Office and the

Central Copyright Office will be harmonized and
will become part of the Intellectual Property
Organisation of Pakistan.
• Measures will be taken to introduce advocacy;
policy framework reviews, open hearings,
coordination with trade associations and the
fostering of awareness.
 Cont’d
• Tribunals will be established to conduct trials of IP
offences. The tribunals will have all of the powers
vested in in a civil court under the Code of Civil
Procedure 1908, the Court of Sessions under the Code
of Criminal Procedure 1898 and a court of appeal
under the Code of Civil Procedure.

• Once the 2012 Ordinance comes into force, all suits

and proceedings pending in any court and instituted
under trademark, copyright or patent legislation (or
other IP laws) will be transferred to, and heard and
decided by, the tribunal that has jurisdiction in the
matter.
 Cont’d
• Appeals against decisions by the registrar of
trademarks or the controller of patents will be
filed before the tribunals.

• Appeals against the tribunals’ decisions will be

filed in the High Court, which has territorial
jurisdiction over the tribunals.

• The 2005 Ordinance could not be ratified within

that time.
 THE INTELLECTUAL PROPERTY
ORGANISATION ACT
Sections 39 ACT XXII of 2012
Schedule I
(www.ipo.gov.pk)
On 3rd December, 2012, the President promulgated
an Act to provide for the establishment of Intellectual
Property Organization of Pakistan:
Copyrights, trademarks, patents, designs, lay-out,
designs of integrated circuits, trade secrets and other
powerful tools for economic growth. The protection of
these and similar intellectual property rights of the
citizens is essential to foster creative thinking, stimulate
creativity, provide incentives for technological
innovations, and attract investment.
Came in to effect from the 28th August, 2012.
An autonomous body having perpetual succession.
 Cont’d
• Policy Board. The chairman and fourteen other
members as specified in sub-section (2).
• Function etc., of the Board. The Board shall be
responsible for setting of objectives and policy
guidelines of the Organization.
Take policy decisions as well as advise the
Federal Government.
Delegate all or any of its powers and
functions to the Chairman.
• The Director-General shall be the functional
head of the Organization and shall be responsible
for day to day administration of the affairs of the
Organization.
 Cont’d
• Powers and functions of the Organization.
Administer and coordinate all government systems
for the protection and strengthening of intellectual
property laws, rules and regulations made
thereunder.
Promote intellectual property through advocacy
which, among others, shall include:
Creating awareness
Reviewing policy framework
Holding open hearings
Trial of offences. An accused shall be tried and
prosecuted for an offence in the Tribunal and the case
shall be heard from day to day and shall be disposed
of within ninety days.
 Cont’d
• Establish as many Intellectual Tribunals as it
considers necessary and to appoint Presiding
Officer for each of such Tribunal and where
notification the territorial limits within which
territorial limits of each such tribunal and transfer
any case from one Presiding Officer of the
Tribunal.
• Power of the Tribunals. Excise powers Code of
Civil Procedure 1908 and criminal jurisdiction.
• Jurisdiction of the Tribunals. All suits and
other civil proceedings regarding infringement of
intellectual property laws shall be instituted and
 Cont’d
• Appeal: Order of the Tribunal under the Act may,
within thirty days of the final judgment or order of
the Tribunal, prefer an appeal to the High Court
having territorial jurisdiction over the Tribunal.
• IPO Pakistan Fund: shall be financed from grant
from government, add, charges, fee, revenue from
its own resources.
Upon the commencement of this Act, the
Trademarks Registry, Copyright Office and Patent
Office hereinafter referred to as the said offices shall
become part of the Organisation.
The IP Act Pakistan brings the trademark office, the
Patent Office and the Copyright office under the
administrative control of PO Pakistan. The offices
would continue working by their respective
 Cont’d
charters and laws, but IO Pakistan would have the
mandate to hear complaints against them, to enforce
IP related laws upon them, to allocate budget or to
coordinate their activities. This leads to one window
creates a tremendous facility for IP related issues.
IPO Pakistan has the power to guide or direct
other arms of the Government promulgating rules and
regulations, as other stakeholders must also accept
their responsibility in this task. Another step that is
proposed here is the creation of special court for IP
enforcement.
The major functions of the Organization
include:
• Administer and coordinate all Government systems
for protection and strengthening of Intellectual
Property (IP);
 Cont’d
• Manage all IP offices in the country;
• Create awareness about IP rights;
• Advise Federal government on IP Policy;
• Ensure effective enforcement of IP rights through
designated IPR enforcement Agencies (Police, FIA,
and Pakistan Customs).
Pakistan required up gradation of its intellectual
property infrastructure in tandem with global
trends. Accordingly the existing legislation on
Intellectual Property i.e. Copyrights, Patents and
Trademarks.
THE PATENTS ORDINANCE 2000
 Cont’d
Patent is the name given to a bundle of monopoly
rights which give the patentee the exclusive right to
exploit an invention for a stated period of time and to
prevent anyone else from exploiting that invention. A
Patent may well have an international application then
there has been a certain amount of international
cooperation concerning the filing of an application for a
patent.

In 1970 the Patent Co-operation Treaty (PCT) was came

into operation in 1978. The scheme is operated under
the World Intellectual Property Organization in Geneva.

The PATENTS ORDINANCE extends to the whole of

Pakistan.
 Cont’d
Definitions:
“Exclusive licence”
“Invention”
“Inventor”
“Mail box”
“Patent agent”
“Patentee”
“Patent office”
“Published”
Where the “invention” is defined to mean as
new and useful product or process in any field of
technology; and includes any new and useful.
 Cont’d
A patent is a grant from the Government, which
confers on the grantee, for a limited term of 20 years, the
following acts, namely.
1. When patents has been granted in respect of a
product.
2. When the patents has been granted in respect of a
process.
A patent is grant of exclusive rights for an
invention to make, use and sell the invention for a limited
period of 20 years. The patent grant excludes others from
making, using, or selling the invention. Patent protection
does not start until the actual grant of a patent.
The European Patent Convention 1973 (EPC) 1978
termed “a bundle of national patents”. Three
requirements which determine whether or not an
invention is capable of being patented:
3. Novelty;
 Cont’d
1. Novelty – Invention taken to be new
2. An Inventive Step
Invention does involve an inventive step. Test
directed to a man skilled in the art.
3. Capable of Industrial Application
Invention should be capable of industrial
application. In requirement of “capable of
industrial application” will be satisfied by any
invention if it can be made or used in any kind of
industry, including agriculture.
Ownership of a Patent
Any person may apply for a patent but if the
applicant is not the inventor then he must file a
statement identifying that person and showing why
he is applying for the inventor is an employee.
 Cont’d
Infringement of a Patent

Will be direct infringement of a patent if a

person:

1. Makes a patented product;

2. Disposes or offers to dispose of or import or

keep for disposal a patented product;

3. Uses a patented process;

Also be infringement if a person supplies or

offers to supply “means essential for putting an
invention into effect” to a person not entitled to
work the invention.
 Cont’d
Remedies for Infringement

Final Orders which the court may grant are:

1. Damages

2. Account of profits

3. Order of delivery up or destruction of

infringing goods

Repeated then an injunction may be asked for.

COPYRIGHT
 Cont’d
Copyright is intended to protect the skill,
labour and effort which have been expended in
producing the work. The author of the work is the
only one with a right to copy it in the sense of using
it again or publishing it. It follows therefore that no-
one else has this right. Copyright arises merely by
bringing a work into existence. Unlike a patent there
is no need for any registration.
The owner of a copyright, in the same way as
the owner of a patent, owns a monopoly. The case of
copyright the monopoly of its owner is only of a
limited owner of patent has complete control over
the marketability of the invention patented. In the
case of copyright the owner can prevent other
people from copying his work; but similar works
 Cont’d
Property right which subsists in an original literary,
dramatic, musical or artistic works; sound
recordings, film, broadcast or cable programmes;
typographical arrangements of published, literary
works would include any table or compilation or a
computer program. Artistic works would include a
graphic work, a photograph or a sculpture
irrespective of any artistic quality.

Ownership of Copyright
First owner of copyright is the author of the work
and this means the person who created the work. In
case of employer and employee course of this
employment then the employer will own the
copyright. Other case then the author will own the
 Cont’d
A copyright may be assigned and this must be
in writing signed by or on behalf of the assignor.
Copyright may be transmitted by testamentary
disposition or by operation of law as in the case of
personal.
THE COPYRIGHT ORDINANCE, 1962
It extends to the whole of Pakistan.
Definitions:
• “Adaptation” means
• “Architectural work
of art”
• “Artistic”
• “Audio-visual work”
• “Author”
• “Book”
• “Cinematographic
work”
• “Copy”
• “Counterfeit copy”
 THE COPYRIGHT ORDINANCE, 1962
• “Dramatic work” • “Periodical”
• “Engravings ” • “Photograph”
• “Exclusive licence” • “Plate”
• “Infringing copy” • “Public libraries”
• “Lecture” • “Radio diffusion”
• “Literary work” • “Record”
• “Manuscript” • “Recording”
• “Musical work”
• “Rental”
• “Newspapers”
• “Reproduction”
• “Pakistani work”
• “Work”
• “Performance”
• “Work of joint
• “Performing rights
authorship”
society”
 Cont’d
“Copyright” – Meaning and scope. This copyright
relates to the right of printing or publishing to the
exclusion of others. The Copyright Ordinance of
1962 defines copyright and lays down conditions
and circumstances under which the copyright of
foreigner and Pakistani citizen can be preserved
from infringement.
• Sense of the sole and exclusive liberty of printing
or otherwise multiplying copies of any work
already published, of the author before
publication are these the undisputed right to the
manuscripts, he may withhold or communicate it,
such restrictions as he pleases on the use of
author may prevent the publication of work until
he himself has made it public.
 Cont’d
Copyright deals with the protection of literary and
artistic works. These include writings, music, and
works of the fine arts, such as paintings and
sculptures, and technology-based works such as
computer programs and electronic databases.
Copyright is a legal instrument that provides the
creator of a work of art or literature, or a work that
conveys information or ideas, the right to control
how the work is used. The intent of copyright is to
advance the progress of knowledge by giving
an .....hor of a work an economic incentive to create
new works.
Copyright includes the following creative
works:
I. Literary works which includes Books,
 Cont’d
II. Artistic works like paintings, Maps,
Photographs, Drawings, Charts, Calligraphies,
Sculptures, Architectural Works, Label Designs,
Logos, Monograms and other works alike.
III.Cinematographic works which includes
movies, audio-visual works, documentaries, etc.;
and
IV. Record works which include sound recordings,
musical works etc.
 TRADEMARKS

Any word or symbol or combination of both which is

used to indicate a connection in the course of trade
between the goods in relation to which the mark is
used and the owner of the mark.

Trademark is “Any sign capable of being

represented graphically which is capable of
distinguishing goods or services of one undertaking
from those of other undertakings”.

Nobody has the right to represent his goods as the

goods of somebody else.”
 Cont’d
Remedies a plaintiff who is successful will be
entitled to an injunction and to damages or an
account of profits. Obliteration or modification of the
mark, name or wording complained.

Marks cannot be registered if identical with an

earlier trademark covering identical goods or
services, or where similarity of mark and goods or
services is likely to cause confusion to the public.
TRADE MARKS ORDINANCE, 2001
Extends to the whole of Pakistan.
Object of Trade Marks Act, 2001. Mechanism
provided in Trade Marks Act, 2001 envisaged that
multiplicity of proceedings must be avoided.
Application in respect of a trade mark could be filed
in a Court, where some proceedings in respect
thereof were already pending. Principles.
Definitions:
• Advertising
• Assignment
• Authorized user
• Certification mark
• Collective mark
• Comparative advertisement
 Cont’d
• Convention application
• Convention country
• Counterfeit trade mark goods
Trade Marks Registry:
Trade Marks Registry (TMR) is premier body
of Intellectual Property Organization of Pakistan
(IPO-Pakistan) working for the registration of trade
and services marks. It is a federal government body
and its registration for trade and services marks lies
within the geographical boundary of Pakistan. The
Trade Marks Registry is headed by a Registrar.
A trademark is a sign that individualizes the
goods of a given enterprise and distinguishes them
from the goods of others. It can be in the form of
words, designs, letters, numerals or packaging,
 Cont’d
Application for Registration
• Request for registration;
• Name and address of the applicant;
• Statement of the goods or services for which
registration
• Representation of the mark is being used by or
with the consent of the applicant in relation to
those goods or services.