Question

"Every person dealing with the company is presumed to have read the memorandum and articles of associations and understood them in their true perspective, irrespective of the fact whether one has actually read them or not." The underlying doctrine in this regard is known as

• A. Doctrine of Indoor Management
• B. Doctrine of Constructive Notice
• C. Doctrine of Lapse
• D. Doctrine of Outdoor Management

Hint:

Constructive notice = "You are assumed to know the company's rules, whether you read them or not."

Answer 1

The Correct Option is B

Step 1: Understand the concept of constructive notice.
- Doctrine of constructive notice assumes that everyone dealing with a company has knowledge of its memorandum and articles of association.
Step 2: Compare with other doctrines.
- Indoor management relates to protecting outsiders dealing with the company against irregularities (different from constructive notice).
- Lapse doctrine relates to shareholders’ rights ceasing after certain events.
Step 3: Conclude.
- The statement clearly refers to the doctrine of constructive notice.