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September 14, 2019


Supreme Court
The Supreme Court as stipulated in Article 141 of the Constitution is the highest authority for the administration of justice in the Maldives. The Supreme Court is the highest authority for the interpretation, protection and enforcement of the Constitution, and also plays a critical role in the administration of the court system. Its constitutional mandate is to protect the fundamental rights of all citizens, to resolve legal disputes in a fair and transparent manner, and to ensure justice through an independent, honest, and effective judicial system. There are 5 sitting justices in the Supreme Court.

High Court
The High Court of the Maldives comprises of 11 judges. If a ruling of a lower court has been appealed to the High Court, the High Court has the power to review the decision of the lower court to check the constitutional and legal validity of the decision and to overturn such a decision. The High Court also has the jurisdiction to enquire into and rule on the constitutional validity of any Law or part of a Law.

Subordinate Courts

The subordinate courts of the Maldives are the five superior courts, which is based in Malé and the magistrate courts in each inhabited island.
The five superior courts situated in Male are:
o the Criminal Court
o the Civil Court
o the Family Court
o the Juvenile Court
o the Drug Court

• Magistrate courts are located in each inhabited island. Presently there are 132 sitting Magistrates in 187 Magistrate Courts in the country.

Define State and identify elements of State.
These definitions draw attention to the fact that the state has four essential elements. These are: (1) population, (2) territory, (3) government, (4) sovereignty (or independence). The first two elements constitute the physical or material basis of the state while the last two form its political and spiritual basis.
1. Population:
The state is a human institution. So population is its primary element. There is no hard and fast rule about population. The ancient Greek writers like Plato and Aristotle favoured a small population. According to Plato, an ideal state should have a population of 5040.:
Aristotle laid down a general principle that the population of a state should be large enough to make it sufficient and small enough to make good government possible. It must be remembered that both of them were thinking in terms of small city-states.
In modern times, Rousseau, prompted by considerations of direct democracy, fixed the number at 10,000. In modern times states vary greatly from the few thousands of Monaco or of San Marino to the crores of China or of India. The modern tendency is in favour of large states. All that can be said is that a large population is an advantage from the point of view of military defense.
However, a large population can be a liability if the resources of the state are not adequate for its maintenance. One of the main problems faced by developing countries is over-population. Thus there should be a happy balance between the size of the population and material wealth of a state.
2. Territory:
A definite and more or less permanent territory is also regarded as an essential element of the state. In modern times, the citizens are bound together by residence on a common territory. Land, water and air space comprise the territory of a state.
As in population, so in territory, no limit can be laid down. Small states and large ones exist side by side. We have tiny states like San Marino with an area of less than twenty-five square miles. On the other hand, there are giant states like the Russian Republic, China, U. S. A., and Australia with millions of square miles.
According to international law, all states are equal in status and right, no matter how unequal they are in population and area. It is claimed that small states are good for efficient administration and inculcating among the people a sense of unity and love for the state.
However, the truth is that a small state is at a disadvantage in its relations with larger ones. Small states are under the influence of one or the other large and powerful state. It is said in favour of large states that they are strong in defense and because of availability of resources they are economically self-sufficient.
It may be pointed out that the power and security of a state are not determined only by the size of its territory. Some other factors in this regard are geographical location, resources and climate.
3. Government:
A people occupying a definite territory cannot form a state unless they are politically organized i.e., unless they possess a government. Government is the political organization of the state. It is the concrete and visible instrument of state power.
According to Garner, government is the agency through which “common policies are determined and by which common affairs are regulated.” The state wills and acts through the government. Government must be effective; it must possess the capacity to maintain order and enforce obedience. Without a government there would be lawlessness and anarchy and ultimately the state would be dissolved.
Government consists of three organs, namely, legislature, executive and judiciary. The legislature makes laws; the executive enforces laws while the judiciary adjudicates cases or disputes.
There are different kinds of government in different states such as monarchy, democracy and dictatorship. Most of developed states are democracies. Many developing countries including India have democratic governments. Whatever may be the form of government, one thing is clear – there can be no state without government.
4. Sovereignty:
By far the most important characteristic of the state is its sovereignty. It is the characteristic which distinguishes the state from all other associations. It denotes the supreme power or the final authority from which there is no appeal.
  1. What is Corporate Veil? Mention 3 situations that require lifting the corporate veil. 


Before dealing with the lifting of corporate veil it is pertinent to define what the meaning of a company is. Strictly, a company has no particular definition but section 3(1) (i) of the Companies Act attempts to provide the meaning of the word in context of the provisions and for the use of this act. It states: ‘a company means a company formed and registered under this Act or an existing company as defined in section 3 (1) (ii).’ The company must be registered under the Companies Act for it to become an incorporated association. If it is not registered it becomes an illegal association. This paper would deal with the lifting of corporate veil and its aspects with the judicial decisions. Let us first discuss the exact meaning of corporate veil and lifting of corporate veil with limited liability concept.

Corporate veil:

A legal concept that separates the personality of a corporation from the personalities of its shareholders, and protects them from being personally liable for the company’s debts and other obligations.

Lifting of Corporate veil:

At times it may happen that the corporate personality of the company is used to commit frauds and improper or illegal acts. Since an artificial person is not capable of doing anything illegal or fraudulent, the façade of corporate personality might have to be removed to identify the persons who are really guilty. This is known as ‘lifting of corporate veil’.
It refers to the situation where a shareholder is held liable for its corporation’s debts despite the rule of limited liability and/of separate personality. The veil doctrine is invoked when shareholders blur the distinction between the corporation and the shareholders. A company or corporation can only act through human agents that compose it. As a result, there are two main ways through which a company becomes liable in company or corporate law: firstly through direct liability (for direct infringement) and secondly through secondary liability (for acts of its human agents acting in the course of their employment).
There are two existing theories for the lifting of the corporate veil. The first is the “alter-ego” or other self theory, and the other is the “instrumentality” theory.
The alter-ego theory considers if there is in distinctive nature of the boundaries between the corporation and its shareholders.
The instrumentality theory on the other hand examines the use of a corporation by its owners in ways that benefit the owner rather than the corporation. It is up to the court to decide on which theory to apply or make a combination of the two doctrines.
Concept of limited liability:
One of the main motives for forming a corporation or company is the limited liability that it offers to its shareholders. By this doctrine, a shareholder can only lose what he or she has contributed as shares to the corporate entity and nothing more. This concept is in serious conflict with the doctrine of lifting the veil as both these do not co-exist which is discussed by us in the paper in detail.

What is a Sole Proprietorship?

A sole proprietorship is a one-person business that, unlike partnerships and other more complex business structures (corporations and LLCs), doesn’t have to register with the state in order to exist. If you are the sole owner of a business, you become a sole proprietor simply by conducting business.

Sole proprietorships are some of the most common forms of small businesses, mainly due to the numerous benefits they provide. Firstly, it is by far the easiest type of business to start, since most states do not require sole proprietors to register their business with their Secretary of State. There are also fewer regulations about having a board of directors (since it will just be you) and recorded meetings. Another obvious bonus is that you have no one to answer to but yourself, having the ability to set your own work schedule and routine. You also don’t have to share your profits with anyone (unless you hire employees, of course).

This sounds like a pretty sweet deal, but there are some downsides to a sole proprietorship. The biggest problem with sole proprietorships is that the business owner’s personal financials are tied directly to the business. This means that if the business goes bankrupt, so does the business owner. This makes a sole proprietorship a bit riskier. Along the same lines, any lawsuit brought against your business is also brought to you personally (meaning you are responsible for all the fees and costs associated with litigation). Sole proprietorships are also responsible for paying both income taxes and a self-employment tax (for Social Security and Medicare) on all profits of the business. This means that as the business becomes more profitable, you will end up owing even more in taxes.
What is a Partnership?

A partnership is a kind of business legal structure formed by the agreement between two or more individuals to carry on a business. Each partner is a co-owner, and each has invested in the business. A partnership, as different from a corporation is not a separate entity from the individual owners. In that sense, it’s more similar to a sole proprietorship because in both the business isn’t separate from the owners, for liability purposes. Also, don’t forget that are many types of structures under the umbrella of partnerships.

What is a Private vs Public Company?

The main difference between a private vs public company is that the shares of a public company are traded on a stock exchange, while a private company’s shares are not. There are several more important differences to understand, which this article will outline below.
Differences between a Private vs Public Company

The main categories of difference are trading of shares, ownership (types of investors), reporting requirements, access to capital, valuation considerations, and risks.

Access to Capital and Liquidity

Being able to access public markets to raise new money, as well as the benefit of liquidity (being able to easily sell shares), is the biggest benefit for public companies. When a business undergoes an Initial Public Offering (IPO) with the aid of investment banking professionals, it becomes much easier to raise additional funds. The funds can be used for growth, mergers and acquisitions, or other corporate purposes.

Once the company is listed, investors can easily move in and out of the stock by buying and selling shares that trade on the stock exchange.

Reporting Requirements

Public disclosure requirements are another main difference between the two types of businesses and a major drawback of being public.

As a publicly listed company in the U.S. (i.e., stock trades on a U.S.-based exchange), you are required to file quarterly financial reports (10-Q) and annual reports (10-k) and several other disclosure documents.

Valuation of a Private vs Public Company

Publicly traded businesses are much easier for market analysts and investors to value than their private counterparts. The main reason is due to the value amount of information that’s readily available, thanks to the reporting requirements (discussed above), as well as equity research reports and coverage by equity research analysts.

Both types of companies can be valued using the same three methods: comparable company analysis, precedent transactions, and discounted cash flow (DCF) analysis.

Financial modeling via DCF analysis is the preferred method of valuing both types of businesses. However, for a private company, it will be almost impossible without access to internal company information.
Purposes and Functions of Law

The law serves many purposes and functions in society. Four principal purposes and functions are establishing standards, maintaining order, resolving disputes, and protecting liberties and rights.

3.1 Establishing Standards

The law is a guidepost for minimally acceptable behavior in society. Some activities, for instance, are crimes because society (through a legislative body) has determined that it will not tolerate certain behaviors that injure or damage persons or their property. For example, under a typical state law, it is a crime to cause physical injury to another person without justification—doing so generally constitutes the crime of assault.

3.2 Maintaining Order

This is an offshoot of establishing standards. Some semblance of order is necessary in a civil society and is therefore reflected in the law. The law—when enforced—provides order consistent with society’s guidelines.

3.3 Resolving Disputes

Disputes are unavoidable in a society made of persons with different needs, wants, values, and views. The law provides a formal means for resolving disputes—the court system. There is a federal court system and each state has its own separate court system. There are also various less formal means for resolving disputes—collectively called alternative dispute resolution (ADR). We will learn about the federal and state court systems in chapters 6 and 7, respectively, and about ADR in chapter 9.

3.4 Protecting Liberties and Rights

The constitutions and statutes of the United States and its constituent states (see chapter 5) provide for various liberties and rights. A purpose and function of the law is to protect these various liberties and rights from violations or unreasonable intrusions by persons, organizations, or government. For example, subject to certain exceptions, the First Amendment to the Constitution prohibits the government from making a law that prohibits the freedom of speech. Someone who believes that his free speech rights have been prohibited by the government may pursue a remedy by bringing a case in the courts.

You have probably realized that laws may serve more than one principal function and there are obviously more principal functions than the four that we have identified.

 11. Discuss the sources of law. 

Sources of law are the origins of laws, the binding rules that enable any state to govern its territory.

The term "source of law" may sometimes refer to the sovereign or to the seat of power from which the law derives its validity.

2Sources in different legal systems
3International sources
4National sources
5See also

The perceived authenticity of a source of law may rely on a choice of jurisprudence analysis. Tyrants such as Kim Jong-un may wield De facto power, but critics would say he does not exercise power from a de jure (or legitimate) source. After WWII it was not a valid defence at Nuremberg to say "I was only obeying orders", and the victors hanged Nazis for breaching "universal and eternal standards of right and wrong".

Over decades and centuries, principles of law have been derived from customs. The divine right of kings, natural and legal rights, human rights, civil rights, and common law are early unwritten sources of law. Canon law and other forms of religious law form the basis for law derived from religious practices and doctrines or from sacred texts; this source of law is important where there is a state religion. Historical or judicial precedent and case law can modify or even create a source of law. Legislation, rules, and regulations are form the tangible source of laws which are codified and enforceable.
Sources in different legal systems[edit]

In civil law systems, the sources of law include the legal codes, such as the civil code or the criminal code, and custom; in common law systems there are also several sources that combine to form “the law”. Civil law systems often absorb ideas from the common law and vice-versa. Scotland, for instance, has a hybrid form of law, as does South Africa, whose law in an amalgam of common law, civil law and tribal law.

A state may comply with international law, it may have a written or federal constitution, or it may have regional legislature, but normally it is the central national legislature that is the ultimate source of law. While a written constitution may seem to be the prime source of law, the state legislature may amend its constitution provided certain rules are followed. International law may take precedence over national law, but international law is mainly made up of conventions and treaties that have been ratified; and anything that can be ratified may be denounced later by the national parliament. Although local authorities may feel that they have a democratic mandate to pass bye-laws,the legislative power they wield has been delegated by parliament; and what parliament gives, parliament make later take away.

In England, the archetypal common law country, there is a hierarchy of sources, as follows:
Legislation (primary and secondary)
The case law rules of common law and equity
Parliamentary conventions
General customs
Books of authority.

Explain the elements of a good contract. 

Definition: The term contract is defined as an agreement between two or more parties which has a binding nature, in essence, the agreement with legal enforceability is said to be a contract. It creates and defines the duties and obligations of the parties involved.
Process of Contract

First and foremost, an offer is made by one party to another, which when accepted by the party to whom it is made, leads to the agreement. If that agreement is enforceable in the court of law, it is known as a contract.
Essential Elements of a Contract

Agreement: The primary element that creates a contract between parties is agreement, which is a result of offer and acceptance, that forms consideration for the parties concerned.
Free Consent: Consent of the parties is another important aspect of a contract, which means the parties entering into the contract, must agree upon the same thing in the same sense. The consent of the parties is said to be free when it is not influenced by coercion, undue influence, fraud, misrepresentation and mistake.
Competency: Competency refers to the capacity of the parties to enter into the contract, i.e. he/she has reached the age of maturity, he/she must be of sound mind, and he/she is not disqualified from contracting, as per the law like the alien enemy, foreign sovereigns, etc.
Consideration: It implies the price agreed to be paid for the promisor’s obligation by the promisee. It must be adequate and lawful.
Lawful object: The object for which the contract is created must be lawful, or else it is declared as void.
Not expressly declared as void: The law should not expressly declare the contract as void, such as contract in restraint of marriage, trade or legal proceedings.

Other important elements of Contract
There must be at least two parties to constitute a contract, i.e. one who proposes and another accepts the same.
The parties entering into the contract must intend to create a legal obligation for one another.
It must be in writing.
There must be certainty of meaning. the terms of the parties must be clear to the parties, i.e. the party should not interpret anything wrong, there must be a consensus ad idem.
There should be a possibility of performing the contract.

So, these are some paramount elements of a contract, without which it cannot be enforced in the court of law.
Types of Contract

On the basis of validity
Valid Contract: An agreement which is enforceable by law, is a valid contract.
Void Contract: The contract which is no longer enforceable in the court of law is a void one.
Voidable Contract: A contract in which one of the parties to the contract has a choice to avoid performing his/her part, then it is termed as a voidable contract. When the consent of the party is not free, the contract becomes voidable, at the option of the aggrieved party.
Illegal Contract: A contract which is forbidden by law is termed as an illegal contract.
Unenforceable Contract: The contract whose substance is good, but due to some issues, it is not enforceable, is called unenforceable contract.
On the basis of formation
Express Contract: When the terms of the contract are expressed orally or in writing, it is known as an express contract.
Implied Contract: The contract which is constituted by implication of law or action, is an implied one.
Quasi-Contract: These are not real contract, but are identical to a contract, which is formed out of some circumstances.
On the basis of Performance
Executed Contract: When the contract is performed, it is known as an executed contract.
Executory Contract: When the obligation in a contract, is to be performed in future, it is described as an executory contract.
Unilateral Contract
Bilateral Contract

To sum up, agreements are termed as a contract, if it comprises all the essential elements that constitute a contract.
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