Charles Mac Naughten Sir Francis Beaufort Palmer.

Company precedents for use in relation to companies: subject to ..., Volume 2 online

. (page 11 of 152)
Online LibraryCharles Mac Naughten Sir Francis Beaufort PalmerCompany precedents for use in relation to companies: subject to ..., Volume 2 → online text (page 11 of 152)
Font size
QR-code for this ebook


Google



INTRODUCTORY. 16

of tlie company for the greater part of the six months immediately
preceding the presentation of the petition for winding-up of company,
and shall include, in the case of an unregistered company, any place
which, in pursuance of sect. 199 of the Companies Act, 1862, is to be
deemed to be the registered office of the company for the purpose of
the winding-up thereof. See sect. 199 of 1862, above.

The expressions *' company'' and ''winding-up by order of the
Court," miist, when used in the Act of 1890, be interpreted with regard
to the following provisions : —

Sect 31 of 1890. — (1) This Act shall not, except where it is expressed
to have a more extended application, apply to any company which is
being wound up in pursuance of an order made before the commence-
ment of this Act.

(2) For the purposes of this Act a company shall not be deemed to
be wound up by order of the Court if the order is to continue a
winding-up under the supervision of the Court.

(3) This Act shall not apply to any company unless the registered
office of the company is situate in England or Wales.

Companies {Winding-up) Rules^ 1903.

&. 2 of 1903. — In these rules, unless the context or subject-matter
otherwise requires, —

" The Acts '' means the Companies Acts, 1862 to 1900.

'< The Act of 1890 " means the Companies (Winding-up) Act,

1890.
** The company" means a company which is being wound up,

or against which proceedings to have it wound up have been

commenced.
'' The Court '' means the Court which has jurisdiction to wind

up the company.
« Creditor'* includes a corporation, and a firm of creditors in

partnership.
" Gazetted " means published in the London Gazette.
"Judge " means, in the High Court, the judge who for the time

being exercises the jurisdiction of the High Court to wind up

companies, and in any other Court the judge thereof or officer

who exercises the powers of the judge thereof.
''Liquidator" includes an official receiver when acting as

liquidator.
" Official Eeoeiver " includes any officer appointed by the Board

of Trade to discharge the duties of official receiver under the

Acts.
'' Palatine Court " means one of the Chancery Courts of the

Counties Palatine of Lancaster and Durham.



Digitized by



Google



16



INTRODUCTORY.



General
practice.



Proceedings " means the proceedings in the winding-up of a
company tmder the Acts and Bules.

Begistrar '* means in the High Court any of the registrars in
bankruptcy of the High Court, and any person who shall be
appointed to M the of&ce of registrar under these Bules, and
where a winding-up of a company is in the District Registry
of Liverpool or Manchester means the district registrar ; and
in a County Court, where there are joint registrars means
either of such registrars, or a deputy registrar, and in any
Court other than the High Court, means the officer of the
Court whose duty it is to exercise in relation to a winding-up
the functions which in the High Court are exercised by a
registrar or master.

Eules " means these Eules, and includes the prescribed forms.
Sealed *' means sealed with the seal of the Court.
Taxing Officer " means the officer of the Court whose duty it is
to tax costs in the proceedings of the Court under its ordinary
jurisdiction.



General Fracticei how far applicable.

E, 201 of 1903. — In all proceedings in or before the Court, or any
judge, registrar, or officer thereof, or over which the Court has juris-
diction under the Acts and rules, where no other provision is made by
the Acts or rules, the practice, procedure, and regulations shall, unless
the Court otherwise in any special case directs, in the High Court, be
in accordance with the rules of the Supreme Court and practice of the
High Court, and in a Palatine Court and County Court in accordance,
as tar as practicable, with the existing rules and practice of the Court
in proceedings for the administration of assets by the Court.

Throughout the volume the general practice, where applicable, is
stated.

The jurisdiction and powers of the now abolished Stannaries Court,
which are transferred to certain County Courts, are to "be exercised
subject to and in accordance with rules of Court for regulating the
procedure in County Courts.** Stannaries Court (Abolition) Act,
1896, s. 1. See County Court Rules, 1903, Ord. LI., infra ^ p. 706.



County Courts (Stannaries Jurisdietion) Rules, 1897.

Stannaries. Proceedings for the winding-up of companies [formerly under the

Stannaries Court] shall be regulated by, and costs in such proceedings
shall be taxed under, the statutory provisions, rules, and scales of
costs for the time being in force for the winding-up of companies in
the County Courts.

And see ibid, K. 7 as to the fees of solicitors formerly practising as
advocates in the Stannaries Court.



Digitized by



Google



17



Section I.
WINDING-UP BY THE COURT.



CHAPTER I.

JURISDICTION.



Over what Companies.

Thb winding-up jurisdiction extends over —

1. Companies formed and registered under Part I. of the Act of Part I.
1862, and having a registered office in England or Wales. Companies.

These companies are all registered with a memorandum of associa-
tion, and either as limited by sheures, limited by guarantee, or un-
limited — and the jurisdiction extends to the last-named, although they
have no shcure capital. North of England Iron Steamship Insurance Co,^
(1900) 1 Ch.481.

2. Companies to which the Act of 1862 is made applicable by the Part VI.
provisions contained in Part VI. (ss. 175—178) of that Act, and Compamee.
having a registered office in England or Wales.

These companies include all those which were formed and regis-
tered, or registered but not formed, imder —

"The Joint Stock Companies Act, 1856,''

" The Joint Stock Companies Acts, 1856, 1857,"

" The Joint Stock Banking Companies Act, 1857," and

** The Act to enable Joint Stock Banking Companies to be formed
on the principle of Limited Liability," or any one or more of
such Acts.

As to the general meaning of "joint stock company," see and com-
pare the conflicting observations of Kay, J., in Bristol Athenaum,
43 Ch. D. 236 ; Stirling, J., in He Jones, (1898) 2 Ch. 83, 91 ; and
North, J., in RusseU Institution, (1898) 2 Ch. 72, 79.

P. u



Digitized by



Google



18



PartVn.
Companiee*



UnregiBtered
oompanies.



WINDING-UP BY THE COURT. [ChAP. I.

3. Companies registered under Part VII. of the Companies Act,
1862, and having a registered office in England or Wales.

The companies which can be bo registered are specified in sects. 179
and 180 of the Act of 1862, and include companies incorporated by
Act of Parliament or by charter, companies subject to the Act of
8 Vict. c. 110, intituled "An Act for the Registration, Incorporation,
and Begnlation of Joint Stock Oompanies," companies formed by
deed of settlement, and cost<book mining companies. And the Act
provides (sect. 180) that the registration is not to be invalid by reason
that it has taken place with a view to the company being wound up.

See also sect. 181 as to definition of "joint stock company" under
this part of the Act.

4. Unregistered oompanies, as defined in Part VIII. (s. 199) of the
Act of 1862, that is to say, "Any partnership, association or company
(except railway companies incorporated by Act of Parliament) con-
sisting of more than seven members and not registered under this
Act," and having a registered office in England or Wales.

The following are instances of various kinds of unregistered com-
panies which have been ordered to be wound up : —

(1) Companies incorporated by Special Act'-Brad/ord Navigation

Co,y 10 Eq. 331 ; Wey and Arun Junction Canal Co,^ 4 Eq. 197 ;
Brentford and Isleworth Tramways Co,^ 26 C. D. 527 ; Borough
of Portsmouth Trams, (1892) 2 Ch. 362; Isle of Wight Ferry
Co., 2 H. & M. 597 ; South London Fish Market Co,, 39 0. D.
824.

(2) Companies incorporated by registration under the Companies
Acts, and possessed of a Board of Trade Order under Gas and
Water Facilities Act duly confirmed by Parliament. — Burton-^
upon-Humber Water Co,, 42 C. D. 585, and many others.

(3) Companies incorporated by Eoyal Charter. — Oriental Bank

Corporation, 54 L. J. Ch. 481 ; Bank of South Australia, (1895)
1 Ch. 578.

(4) Foreign or colonial oompanies having assets and liabilities in
England. — Commercial Bank of India, 3 De G. & Sm. 253 ;
Matheson Brothers, 27 C. D. 225 ; Commercial Bank of South
Australia (No. 1), 33 C. D. 174 ; Queensland Mercantile Agency,
58 L. T. 878 ; Mercantile Bank of Australia, (1892) 2 Ch. 204 ;
Jarvis Conklin Mortgage Co, (U.S.A.), 11 T. L. R. 373.

The fact that the company has not any registered office here
does not preclude a winding-up order if it has assets and
liabilities here. Mercantile Bank of Australia, uhi supra.

Where there are assets and liabilities here, the Court is
disposed to make an order to protect the creditors here. ** I
consider that I am justified in taking steps to secure the



Digitized by



Google



JURISDICTION.

English assets until I see that proceedings are taken in the
New Zealand liqiddation to make the English assets available
for the English creditors, pari passu with the creditors in New
Zealand." Per Kay, J., Matheson Brothers, 27 0. D. 231.

The mere existence of a foreign winding-up order is not a
bar to an order here. Ihtd,

Where a foreign or colonial bank is ordered to be wound up
here, and there is a winding-up in the place of its constitution,
a winding-up here is merely ancillary. Per Kay, J., North
Australian, Sfc. Co. v. Ooldshorough, ^c. Co., 61 L. T. 717; and
the Court acted accordingly in the case of the various Australian
banks ordered to be wound up in 1 893. See also Form 72b, infra.

(5) Companies registered under the Act of 1844 (7 & 8 Vict.
c. 110). — Professional Life Assurance Co., 3 Eq. 671, and
many others.

(6) Partnership or syndicate.— i^oj/a/ Victoria Syndicate, 29 L. T.

668; Adansonia Fibre Co., 9 Ch. 635; Scaramanga Sf Co.,
Pearson, J., 18th April, 1885; Frank Mills Mining Co., 23
C. D. 52 (cost-book mining company).

(7) Building societies formed prior to the Building Societies Act,

1874 (37 & 38 Vict. c. 42), s. 32, and not registered under that
Act. — Doncaster Building Soc, 3 Eq. 158 ; Queen^s Building
Soc, 6 Ch. 815. But according to llfracomhe Permanent, 8fc.
Soc, (1901) 1 Ch. 102, a society certified under the Act of 1836
and not re-registered under the Act of 1874, is by sect. 25 of
the Act of 1894 in effect made illegal. Sed quare, see infra,
Chap. LTT. Under the Building Societies Act, 1874, the
jurisdiction of winding-up building societies under that Act
was vested in the County Court, but the Building Societies Act,
1894 (57 & 58 Vict. c. 47), s. 8, provides that every such society
shall be deemed to be a company within the meaning of the
Companies (Winding-up) Act, 1890.

(8) Trustee savings banks.— Under the Trustee Savings Banks Act,

1863, and 50 & 51 Vict. c. 47, ss. 3, 4.

(9) life assurance companies. — Albert Life Assurance Co. (1869) ;
Family Endowmefit Soc, 5 Ch. 118; Or eat Britain Mutual, Sfc.
Soc, 16 C. D. 246; British Nation, 8 C. D. 679 ; Masonic and
General, 8fc Co., (1892) 2 Ch. 154.

(10) Industrial and provident societies. — 56 & 57 Vict. c. 39.

(11) Defonet companies (under the Companies Act, 1880) where
the petitioner is a creditor. — Anglo-American Exploration, Sfc
Co., (1898) 1 Ch. 100. But that case was decided before sect. 26
of the Companies Act, 1900, under which an aggrieved creditor

c2



19



Digitized by



Google



20 WINDING-UP BY THE COURT. [ChAP. I.

is given the same right to apply for restoration as an aggrieyed
company or member. The efEect seems to be that a creditor
must, before petitioning for a winding-up, obtain an order for
restoration of the company's name to the register.

Concerns But the following have been held not to be unregistered companies

capable S within the definition, and therefore incapable of being wound up

being wound under the Act : —

^^' (a) An illegal company, e.g., one rendered illegal by sect. 4 of the

Companies Act, 1862 {Padstow, Sfc. Association, 20 0. D. 137),
or under the Building Societies Acts. Jlfracombe Permanent^
Sfc. Soc, (1901) 1 Ch. 102.

(b) A trade union. See Trade Union Act, 1871 (34 & 36 Vict,
c. 31), and Trade Union Act, 1876 (39 & 40 Vict. c. 22).

(c) A railway company incorporated by Act of Parliament ; for, as

appears above, sect. 199 of the Act expressly excepts such a
company from the jurisdiction ; but a company is not to be
considered a railway company within the exception unless the
construction of a railway is its main object. Hence a dock or
ferry or other company which owns a railway as a subsidiary
work is not a railway company within the exception. Exmouth
Docks Co,, 17 Eq. 181 ; /*^<? o/" Wight Ferry Co,, 2 H. & M.
597. Nor is a tramway a railway company within the excep-
tion. See Brentford and Isleworth Tramways Co., 26 C. D.
627; Borough of Portsmouth, Sfc, Trams, (1892) 2 Oh. 362.
Sometimes, however, a railway company obtains an Abandon-
ment Act, and in such case it can be wound up. See 30 & 31
Vict. c. 127, s. 31; 32 & 33 Vict. c. 114, s. 4; Skipton and
Wharfedale Rail Co., 20 L. T. 359 ; Uxhridge Rail Co., 43
C. D. 536.

Occasionally, too, a railway company obtains an Act expressly
making it subject to the winding-up jurisdiction. It is clear
that a railway company can register, under Fart VII. of the
Act, as a limited company, and if it does this it can, of course,
be wound up as a company under Part IV. of the Act.

(d) Dissolved companies ; for the jurisdiction does not extend to a

company which has been duly dissolved under sects. Ill or 142
of the Act of 1862, unless, possibly, the dissolution can be set
aside on the g^und of fraud. London and Caledonian, Sfc. Co.,
11 CD. 140 ; Pinto Silver Mining Co,, 8 C. D. 273; Coxon v.
Gorst, (1891) 2 Ch. 73.

(e) Companies struck o£E the register under the Companies Act,

1880, s. 7 ; but an order can be obtained under para. 6 of
sect. 7 of this Act, as amended by sect. 26 of 1900, to restore
to the register, and then the company can be woimd up on a



Digitized by



Google



JURISDICTION, 21

shareholder's, or the company's, or a creditor's petition. As to
the effect of that section, see supra, p. 20.

(f ) Nor, it seems, an ordinary club (St, Jameses Club, 2 D. M. & G.

383) ; nor an association to which the Literary and Scientific
Institutions Act, 1854 (17 & 18 Yict. c. 112), applies. Bristol
jiihenaunif 43 C. D. 236, <ipproved on this point by Stirling, J.,
in He Jones, (1898) 2 Ch. 83, 91 ; and see Hussell Institu-
Hon, (1898) 2 Ch. 72.

(g) Nor a company which consists of less than seven members.

Bolton Loan Soc, 12 C. D. 679 ; Bowling and Welhy^s Contract,
(1895) 1 Ch. 663.
(h) Nor companies registered in Scotland; the Act of 1890 does not
apply to Scotland. Scottish Joint Stock Trust, W. N. (1900) 1 14.

The fact that an imregistered company has disposed of its business
or been dissolved is not necessarily a bar to a winding-up order,
e.g., when it has unpaid creditors. Family Endoumtent Soc, 5 Ch. 118.

Certifioate of Incorporation. — Even before the passing of the Com-
panies Act, 1900,* it was reasonably clear, on the question whether a
company was duly incorporated under the Companies Act, 1862, that
the certificate of incorporation was conclusive. PeeVs case (1867), L. B.
2 Ch. 674 ; Oakes v. Turquand, L. E. 2 H. L. 325, 354. And this was
so even where less than seven persons subscribed the memorandum of
association. The dicta to the contrary in National Debenture Corp.,
(1891) 2 Ch. 505, were in conflict with the principle of the decision of
Lord Cairns in PeeVs case, supra. Legislative sanction to this view
of the author has been given by sect. 1 of the Companies Act, 1900,
by which all certificates of incorporation, whether given before or after
the passing of the Act, are declared to be ** conclusive evidence that
all the requisitions of the Companies Acts in respect of registration
and of matters precedent and incidental thereto have been complied
with, and that the association is a company authorised to be registered
and duly registered under the Companies Acts." See, further, Part I.,
8th ed. pp. 20 et seg.

What Courts.

Seotion 32 (2) of 1890 provides as follows : In Part IV. of the Com- <«The Court.'
panies Act, 1862 [which relates to ''winding-up of companies and
associations under this Act "], and in this Act, the expression " the
Court," when used in relation to a company, shall, unless the contrary
intention appears, mean the Court having jurisdiction under this Act
to wind up the company; and sect. 81 of 1862, which previously
defined " the Court," is accordingly repealed as to England and Wales
by sect. 33 of 1890.



Digitized by



Google



22 WINDING-UP BY THE COURT. [ChAP. !•

Section 1 of 1890 proyides as follows : —

(1.) The Courts having jurisdiction to wind up companies in
England and Wales shall be the High Court, the Chancery Courts of
the Counties Palatine of Lancaster and Durham, the County Courts,
and (he Stannaries Court [since abolished].

(2.) Where the amount of the capital of a company paid up or
credited as paid up exceeds ten thousand pounds, a petition to wind
up the company or to continue the winding-up of the company under
the supervision of the Court shall be presented to the High Court, or,
in the case of a company situate within the jurisdiction of either of
the Palatine Courts aforesaid, either to the High Court or to the
Palatine Court having jurisdiction.

(3.) Where the amount of the capital of a company paid up or
credited as paid up does not exceed ten thousand pounds, and the
registered office of the company is situate within the jurisdiction of a
County Court having jurisdiction under this Act, a petition to wind
up the company or to continue the winding-up of the company
under the supervision of the Court, shall be presented to that County
Court.

(4.) Provided that where a company is formed for working mines
within the Stannaries, and is not shown to be actually working mines
beyond the limits of the Stannaries, or to be engaged in any other under-
taking beyond, those limits, or to have entered itito a contract /or such
working or undertaking, a petition to ivind up the company, or to continue
the winding-up of the company under the supervision of the Court, shall
be presented to the Stannaries Court whatever may be the amount of the
capital of the compqny, and wherever the registered office of the company
is situate,

(5.) The Lord Chancellor may by order exclude a County Court
from having jurisdiction under this Act, and for the purposes of such
jurisdiction may attach its district, or any part thereof, to the High
Court, or to any other County Court, and may revoke or vary any
such order. In exercising his powers under this section, the Lord
Chancellor shall provide that a County Court shall not have jurisdic-
tion under this Act imless it has for the time being jurisdiction in
bankruptcy.

(6.) Every Court having jurisdiction under this Act to wind up a
company shall, for the purposes of that jurisdiction, have all the
powers of the High Court, and every prescribed officer of the Court
shaU perform any duties which an officer of the High Court may
discharge by order of the judge thereof or otherwise in relation to the
winding-up of a company.

See llhhg Motel Co,, (1893) I Q. B. 248 ; New Far Console, (1898) 1 Q. B.
673, 669.



Digitized by



Google



JUEISDICTION. 23

(7.) Nothing in this section shall invalidate a proceeding by reason
of its being taken in a wrong Court.

The High Court has jtirisdiotion to wind up an unlimited company
although it has no share capital, and therefore its paid-up capital
cannot be said to exceed or be under 10,000/. North qf England Iron
Steamship Ittiuranee Co,, (1900) 1 Gh. 481.

The words in italics must now be read in connection with the
Stannaries Court (Abolition) Act, 1 896, which abolishes the Stannaries
Court and transfers its jurisdiction, except in pending cases, to certain
County Courts.



As to the High Court.

Section 2 of 1890 provides as follows : —

Subject to general rules and to orders of transfer made imder the High Court,
authority of the Supreme Court of Judicature Act, 1873, and the
Acts amending it, the jurisdiction of the High Court under this Act
shall, as the Lord Chancellor may from time to time by general
order direct, be exercised, either generally or in specified classes of
cases, either by such judge or judges of the Chancery Division of the
High Court as the Lord Chancellor may assign to exercise that juris-
diction, or by the judge who for the time being exercises the bank-
ruptcy jurisdiction of the High Court.

By an order of 29th November, 1890, the jurisdiction of the High
Court was vested in the following judges of the Chancery Division,
namely, Chitty, North, Stirling and Kekewich, JJ. ; but on 26th
March, 1892, an order was made by Lord Halsbury, L. C, and Lord
Coleridge, C. J., vesting the jurisdiction in Yaughan Williams, J.,
and on the 6th November, 1897, the jurisdiction was vested in
Wright, J.

By an order dated December 16, 1902, the winding-up jurisdiction
was sent back to judges of the Chancery Division.

Order of 16th December, 1902, is as follows :—

Whereas, by the order dated the 6th day of November, 1897, I did
order that on and after the 2nd day of November, 1897, the jurisdic-
tion of the High Court under the Companies (Winding-up) Act, 1890,
should until further order be exercised by the Honourable Mr. Justice
Wright, sitting and acting for the purpose of the exercise of such
jurisdiction as an additional judge of the Chancery Division, and that
the said judge should on and after the day aforesaid and until further
order be the judge of the High Court assigned for the purpose of the
exercise of that jurisdiction, pursuant to the Companies (Winding-up)
Act, 1890. Now, therefore, I, the Bight Honourable Hardinge
Stanley, Earl of Halsbury, Lord High Chancellor of Great Britain, do



Digitized by



Google



24 WINDING-UP BY THE COURT, [ChAP. I

hereby, by virtue of the powers Tested in me by sect. 2 of the Com-
panies (Winding-up) Act, 1890, sect. 5 of the Supreme Court of
Judicature Act, 1884, and all other powers enabling me in that behalf,
order that on and after the 10th day of January, 1902, the jurisdiction
of the High Court under the Companies (Winding-up) Act, 1890,
shall, until further order, be exercised by the Honourable Mr. Justice
Byrne and the Honourable Mr. Justice Buckley, and the said judges
shall, until further order, be the judges of the High Court assigned for
the purpose of the exercise of that jurisdiction, pursuant to the
Companies (Winding-up) Act, 1890. And I do further order that all
matters and actions in the Chancery Division which are on the 10th
day of January, 1902, pending before Mr. Justice Wright be trans-
ferred and assigned to the said Mr. Justice Byrne and Mr. Justice
Buckley.

This order should be read in conjunction with Bule 1 of April, 1892,
under which a few cases, most if not all of which must now have
come to an end, were "retained" by Chitty, North, Stirling, and
Kekewich, JJ. The practice described in this edition does not apply
to those cases. See B. 1 of 1903, supruy p. 11.

Industrial and provident societies with a paid-up capital of over
1,000/., or less if the office is within the jurisdiction of the Metro-
politan Coimty Courts, are now wound up by the High Court. See
56 & 57 Vict. 0. 39, s. 58. And it has a similar jurisdiction as regards
registered building societies. 57 & 58 Vict. c. 47, s. 8.



As to the Lancaster Palatine Court.

Lancaster The jurisdiction of this Court extends over the County of Lancaster,

which, for the purpose of the exercise of such jurisdiction, is divided
into two districts, namely, the Liverpool District and the Manchester
District. Prior to the Act of 1890, the jurisdiction of this Court in
winding-up was regulated by 13 & 14 Vict. o. 43, and 17 & 18 Vict,
c. 82, and the Chancery of Lancaster Act, 1890 (53 & 54 Vict. o. 23).
But now the Court has jurisdiction under sect. 1 of the Companies
(Winding-up) Act, 1890, as regards companies ** situate*' within the
County Palatine, which expression, it is conceived, will be held to mean



Online LibraryCharles Mac Naughten Sir Francis Beaufort PalmerCompany precedents for use in relation to companies: subject to ..., Volume 2 → online text (page 11 of 152)