Pearl, Jade & Diamond decided to form a limited company. The company will be involved in the entertainment business providing models and dancers for the industry. In the meantime, they entered into a contract of employment with Tyra. Tyra is to act as their event manager. The terms of the contract states that Tyra will be paid RM10,000 a month and will continue to work with the company once the company has been formed, for a period of three years.
Three months later, a company known as CayoteUgly Bhd (CUB) was formed. CUB’s MOA expressly states that the business of the company is to …show more content…
At this point of view, we have to look at the company’s main objects. It is a principle of company law that companies have implied powers to do anything which is incidental to their stated objects.  Inadvertently, CUB had entered into a contract with Slippery WhenWet Sdn.Bhd. (SWW) that was presently has been discontented by Giselle because she is a Muslim and doesn’t want to be associated with a company that manufacture and sells liquor. The matter for doctrine of ultra virus may exist and therefore, the issue that can be raised is whether Giselle would be able to restraint the company from carrying on the business of manufacturing and selling liquor or not?
Issue 1: Whether Tyra would be successful in her action against CUB for breach of contract or not?
Firstly, it is necessary to structure the law that relates to Tyra’s situation. It was illustrated that Tyra has been entered into a contract with Pearl, Jade and Diamond, and generally, their activity comes into a pre-incorporation contract. In addition, Tyra shall be regarded as a promoter, as the term is used to enlighten on a person who involved in the formation of the company, and basically who enter into contracts on behalf of a company before that company has received its certificate of incorporation.