Minimum provided that this fact is known to each one of them

On 1st January, 1994 the shares of F and G sold in u court depletion and were purchased by A to the knowledge of e Ethel' shareholder's, The company continued to canyon the business thenaftel' till 31st October, 1994, What would be the' legal consequence of such continuance? Solution, For thc legality of public company there must be a minimum of 7 members. If it falls "below 7, then it must be converted into a Private Company within 6
months, otherwise the members will be personally liable for all debts contracted after ,further acts (Section 45). a war all the member's of a private company, while in general's meting, arc killed by a bomb. Does the company cease to exit Solution. No, the company does not cease to exist because a company has perpetual existence. Its lite does not depend upon the death of any or all member(s). Law creates it and law alone can dissolve it. Pl'llblem 5. X holds all the shal'es (except line) in a timber concern and is also its suhstantial creditor. He gets company's timber insured in his own na'me. Unfortunatcly the timber is destroyed by fire and X claims the l'eimbul'Sement of loss the insu.-ancc company, Is the insul'ance company liuble to X ? Solution. No, the insurance company is not liable to reimburse the loss :'nd pay to X. A
company is a legal person and can own, enjoy and dispose of property in its own name like a natural person. Though it purchases property out of the
funds contributed by its shareholders, yet they cannot claim to be the joint owners of company's property because the company has an entity distinct from the members who constitute it. A shareholder, therefore, has no right to any item of property owned by the company. Consequenlty, he does not have any insurable interest in the company's property. In case of insurance, the insured can claim insurance money only if he had insurable interest in the property lost by- an event insured against. As a shareholder does not have insurable interest in the property of the ()OJrpany, he cannot claim insurance money in the event of loss even if he is a substantial shareholder as well as creditor of the company.. Therefore, in the given problem, X cannot claim the reimbursement of loss to company's property by fire, an event insured against by him. In A1acat/ra Vs. North em Assurance Co. Ltd, a case with facts similar to those given in the problem, a similar decision was announced by thc Court. Problem 6. A public limitcd company has 7 shareholders A,R,C,D,E,F and G. All the shal'es are fully paid up,