Charles Mac Naughten Sir Francis Beaufort Palmer.

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

. (page 46 of 152)
Online LibraryCharles Mac Naughten Sir Francis Beaufort PalmerCompany precedents for use in relation to companies: subject to ..., Volume 2 → online text (page 46 of 152)
Font size
QR-code for this ebook


X. Y., Assistant Secretaiy.

The Agent of the Bank of England,
Law Ots Branch, Temple Bar, London, "W.C.

, Address to which certificate of receipt should be forwarded.

[In the margin opposite the words above is a single oaeh oolnnin, headed
« Amounts.'* Outside this — as on a banker's pajing-in slip — are the words
*» Cheques drawn on," ♦^ToUl of cheques," "Bank of England notes," "Otiher
notes," "Gold," "Total."]

It is particularly requested that the liqr will write his name and
address clearly and legibly. Letters addressed to the Bank of Eng-
land must be prepaid.

[Here follow four columns, headed respectively— " Court," "No. of case,"
" Companies on account of which remittance is made," "Amount."]

Board of Trade.

I hby certify that the above-mentd sum has been credited to the
cos liquidation account at the Bank of England.

, Assistant Secretary of Board of Trade.

19—.



Form 243. \_To he posted unsealed.']

[The form is addre«sed, " On His Majesty's service. The Assistant Secretary,
Finance Department, Board of Trade, London, S.W. Companies."]

Cos (Winding-up) Act, 1890.

19—.

Sir, — I have to acquaint you that I have remitted to the Bank of

England (Law Ots Branch) the sum of £ , shillings and

pence (as detailed in the margin), to be placed to the credit of the

'* cos liquidation account."



Liquidator's
advice letter
of payment
in.

Form C,
No. 7.



Digitized by



Google



BANKING ACCOUNT AND INVESTMENT.



837



Particulars of the cos and respiye amounts to be credited are
stated below.

I am, Sir, jonr obedient servant,

Signature , Liqr.

Address in fuU .

The Assistant Secretary, Finance Department,
Board of Trade, London, S.W.

[In the margin is cash column, with the words opposite, as in the last form, with
the following words beneath — ** Distinguishing between your own cheques and
those received on account of the company, but not realized by you.'' Below the
words printed aboye are fi?e columns, headed respeotiTely — ** Court," '^No. of
case," ** Companies on account of which remittance is made," ** Ledger folio,"
"Amount," with the words below, " Total remittances, as stated above."]

It is particularly requested that remittances may be made direct to
the Bank of England, Law Cts Branch, London, by cheque crossed
" Bank of England, credit of cos liquidation account."



Re



Cos (Winding-up) Act, 1890.

For Bepayment of Advances. Ledger folio.

Qi , No. -

Date-



-, 19—.
., 19-.



Sir, — I hby certify that the under-mentd payments, amounting to

£ : — ' on account of the above coy have been made by me

out of my own moneys, and such payments are now chargeable against
the fid coy, and I have to request the same may be repaid to me. The
balance shown by my books as standing to the credit of the coy in the
cos liquidation account at the Bank of England is £— — : .

Yours obediently,

Signature of Liqr .

The Inspector-General in Cos liquidation,

1, Horse Quards Avenue, London, S.W.

, Address to which cheque should be forwarded.

[Here follow five columns headed respectively — '* Name of person to whom pay*
ment has been made," '<Ck>nsideration," **No. of voucher," **Date of payment,"
"Amount."]

Note. — ThUfotm should not he accompanied by vouchers j and it must be distinctly
understood that any payments made on this application are made dn the sole
responsibility of the liquidator, and are in no way to be taken as sanctioning the
same or precluding disallowance should they be found to be irregular on the audit
of the liquidator's accounts.

P. Z



Form 244,

Notice to
Board of
Trade that a
cheque is
required for
repayment of
liquidator's
advances.
Form C,
No. 5.



Digitized by



Google



838



WINDING-UP BY THE COUET. [ChAP. XXV.



Form 245.

Notice to
Board of
Trade by a
liquidator
that cheques
are required.
Form C,
No. 6.



Cos (Winding-up) Act, 1890. Ledger .

a , No. ,19—.

Re . Pate , 19—.

Sir, — I beg to inform you that it appears by my books that the sum

of £ : stands to the credit of the above coy with the

cos liquidation account at the Bank of England, and that the sum of

& : is required as set forth below.

Tours obediently,

, Signature of Liqr.

The Inspector-Q^neral in Oos Liquidation,
1, Horse Guards Avenue, London, S.W.

, Address to which cheques should be forwarded.

[Here follow three columns, headed respeotiyely — "Name, oocmpation, and
address of person to whom doe," ''State general nature of consideEation,"
** Amount."]

In all cases of payment to executors, trustees, representative officials, fto., the
name or names should be inserted in the application.

NoTB. — This form should be sent direct to the Board of Trade, Bankruptcy
Department. It ahmild not he accompanied hy voueherty and it must be distinctly
understood that any payments made in accordance therewith are made on Uie sole
responsibility of the liquidator, and are in no way to be taken as sanctioning Uie
same or precluding disallowance should they be found to be irregular on the audit
of the liquidator's accounts.



Special Ba2^ Account.

As to when this will be authorised, see sect. 11 (3) of 1800, tvpra. Forxesolntiofi
of committee of inspection in f aTOur of special bank account, see Form 202.

As to the restrictions which may be imposed by the Board of Trade, and their
power to cloMC the account, see R. 148 of 1903, mpra,

<* AU moneys receiyed must be paid into the appointed bank " (Reg. 4 of Jan.
1893, Appx.), *' to the credit of the liquidator of the company." R. 148 (1) of 1903.

As to signing and countersigning the cheques, see R. 148 (1) of 1903.

Where there is a special bank account, no application to the Board of 'Kade in
respect of payment of dividends (0. No. 40, infra^ Form 488) seems to be necessary.
See Reg. 11 of Jan. 1893.

The pass-book and certificate of the banker of the balance are required for audit.
Bee Form 213, Chap. XXIV.



Perm 246.

Application
to Board of
Trade to
authorize
special bank
account.
Form 82 of
1903.



{Titk)

We, the committed of inspection, being of opinion that Mr. ■■■ , of

, the liqr in the above matter, should have a special bank account

for the purpose of [here insert grounds of applicatum], hby apply to
the Board of Trade to authorize him to make his payments into and
out of the Bank.



Digitized by



Google



BANKING ACCOUNT AND INVESTMENT. 339

All cheques to be countersigned by , a member of the committee

of inspection, and by for .

Dated this day of , 19—.

> Committee of Inspection.



See B. 148 of 1903.

The fee on this applioatioiL is 1/. Order, 17th Bee. 1891, Appx.



(Titk.) PormSJ47.



You are hby authorized to make your payments in the above matter Order of

into and out of the Bank. ^^ f

___ . . , _ Trade for

\_Iiere insert any special terms,] special bank

All cheques to be countersigned by , a member of the com- acoo^"***

mittee of inspection, and by . i9^ ^^

Dated this day of — , 19 — .

To , By order of the Board of Trade.

laqr.

See B. 148 of 1908.

The fee on this order is 2/. Order, 17th Bee. 1891, Appx. B.



Re The Coy, limtd. Ot. Perm SJ48.

No. of 19—. Certificate of



I, , of &c., the manager of the branch of the bank at banker of

which the special bank account of the liqr of the above-named coy is gpeci^Unk

kept, hby certify that there is a balance of £ standing at the sd account.

bank to the credit, and at the disposal, of the liqr in the above-named
matter.

Dated this day of , 19—. (Signed) A. B.

Inyestment— Diyidends— Sale of SecuritieB.

Beet. 17 of 1890.— (1) An account shall be kept by the Board of Trade of the Investment
receipts and payments in the winding-up of each company, and when Uie cash of surplus
balance standing to the credit of the account of any company is in excess of the ^^^^7^'
amount which, in the opinion of the committee of inspection, is required for the
time being to answer demands in respect of that company* s estate, the Board of
l^ade shall, on the request of the committee, invest the amount not so required in
government seouritiee, to be plaoed to the credit of the said account for Uie benefit
of the said company.

(2) Wheneyer any part of Uie money ao inrested is, in the opinion of the com* Sale of
mittee of inspection, required to answer any demands in respect of the estate of the securities,
company of the assets of which the money so invested formed part, the Board of
Trade shall, on the request of the oonmiittee, raise such sum as may be required
by the sale of such part of the said securities i^ may be necessary.

(8) The dividends on the investments made under this section shall be paid to the Dividends,
credit of the company of the assets of which the money so invested formed part.

z2



Digitized by



Google



340



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



Interest on
exoess.



Request for
ioTestment
or sale.



Sect. 18 of 1890.— When the balance at the credit of any company's aocoont in
the hands of the Board of Trade exceeds two thousand pounds, and the liquidator
gives notice to the Board of Trade that the excess is not required for the purposes
of the liquidation, then such company shall be entitled to interest upon such excess
at the rate of two per centum per annum.

B. 151 of 1903. — (1) Where the committee of inspection are of opinion that any
part of the cash balance standing to the credit of the account of a company should
be invested, they shall sig^ a certificate and request, and the liquidator shall
transmit such certificate and request to the Board of Trade.

(2) Where the committee of inspection are of opinion that it is advisable to sell
any of the securities in which the moneys of the company's assets are invested, they
shall sig^ a oertifioate and request to that effect, and the liquidator shall transmit
such certificate and request to the Board of Trade. [Formerly R. 134 of 1890.]

(3) Where in a winding-up by the Court there is no committee of inspection, or
in a voluntary windiog-up, or winding-up under the supervision of the Court, if in
the opinion of the liquidator a case has arisen under sect. 17 of the Act of 1890
for an investment of funds of the company or a sale of securities in which the
company's funds have been invested, the liquidator shall sign and transmit to the
Board of Trade a certificate of the facts on which his opinion is founded, and a
request to the Board of Trade to make the investment mentioned in the certificate,
and the Board of Trade may thereupon, if it thinks fit, invest or sell the whole or
any part of the said funds or securities, as provided in the said section, and the
said certificate and request shall be a sufficient authority to the Board of Trade for
the said investment or sale.



Form 249.

Certificate
and request
bv conmiittee
of inspection
as tomvest-
ment of
funds.
Form 84 of
1903.



{TUle.)

We, the committee of inspection in the above matter, hby certify
that in our opinion the cash balance standing to the credit of the
above-named coy is in excess of the amount which is required for the
time being to answer demands in respect of such coy's estate, and

request that the Board of Trade will invest the sum of £ in

government securities, to be placed to the credit of the sd account for
the benefit of the sd coy.

Dated this day of , 19 — .

(Committee of Inspection.

See E. 151 of 1903, iuprtt.



Form 250.

Bequest by
committee of
inspection to
Board of
Trade to sell
securities.
Form 85 of
1903^



{Tiik)

We, the committee of inspection in the above matter, hby certify

that a sxmi of £ , forming part of the assets of the above-named

coy, has been invested in government securities, and that the sum of

£ is now required to answer demands in respect of the sd coy.

And we request that so much of the sd securities as may be necessary
for the purpose of answering such demands may be realized by the
Board of Trade, and that the amount realized may be placed to the
credit of the sd coy.

Dated this day of — , 19— •

*— ^ Committee of Inspection.

See B. 161 of 1003, n^a.



Digitized by



Google



341



CHAPTER XXVL

CABBYING ON THE BUSINESS,

Sect. 13 (1) of 1890.— -The liquidator of a company which ia being wound up Sanction
by the Court may, with the sanction either of the Court or of the committee of roq^ed by
inspection, carry on tiie business of the company. ^™ ^'

If there is no committee of inspection, the sanction of the Court or of the ofBoial
receiver, acting under the special directions of the Board of Trade, must be obtained.
See sect. 9 (9) of 1890 ; B. 188 of 1903.

The wording of sect. 12 (1) of 1890 differs slightly from the wording of sect. 95
of 1862, which empowers the official liquidator, with the sanction of the Court,
'* to carry on the business of the company so far as may be neoessaryfor the beneficial
winding-up of the same,'** and from sect. 57 of the Bankruptcy Act, 1883, for the
words in italics do not appear in sect. 12 of 1890. It would seem, however, that
some such words are implied, and that the Court would, under sect. 12 (3) of 1890,
interfere and stop the carrying on of the business, if proof were given that the
carrying on was not necessary or expedient for the purposes of the winding-up.

It cannot be intended that the liquidator, even with the sanction of the committee Speculative
of inspection, should carry on an unsaleable business merely on the chance that he trading,
may make profits, and thus speculate with the assets. See Wreck Recovery Co,, 15
C. Div. 353 ; Ex parte Emmanuel, 17 C. D. 35 ; Ex parte Cooks, 21 C. D. 397. See
also, as to sect. 95, British Waggon Co, v. Lea, 5 Q. B. D. 149.

But it may be very proper to carry on the business where it is considered that it
may be sold as a going concern, and that to stop it woidd destroy or impair its
value, and so also it may be proper to carry it on when there are pending contracts
which can be carried out without much difficulty, and if not carried out would
involve forfeiture or heavy claims against the company for damages. And so also
where the company has partly manufactured materials, it may be proper to carry
on the business so far as may be necessary to complete the manufacture, if by so
doing a loss will be avoided or a sale effected.

In such cases the circumstances must be carefully considered, and, even if the
committee of inspection give the required sanction, the liquidator should not
he&itate to apply to the Court for directions (sect. 23 (3) ), where there is, or may
be, a difference of opinion. See supra. Chap. XXI.

In order to obtain the sanction of the Court under sect. 95, special reasons for
carrying on the business had to be shown as above.

It had also to be shown that the carrying on was for the benefit of the unsecured
oreditorst and would not involve an expenditure of the free assets for the benefit of
seoored creditors, ^.y., mortgage debenture holders.



Digitized by



Google



343



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



Where liberty to cany on the bosmees was given, it was sometimes limited as
to time, and the time could be extended. Sometimes the question whether the
business should be carried on was submitted to a meeting of oontributories or
creditors, aooording as the company was solvent or insolvent.

Liberty to carry on the business was much more oonmionly given to provisional
liquidators than to liquidators appointed after the winding-up order.

Sometimes liberty to carry on the business is given by the order appointing a
provisional liquidator. See Ghap. X. And sometimes by the winding-up order.
General Service Stores, 64 L. T. 228.

But it is more usual to appoint the official receiver provisional liquidator,
restricting his power to make an application for the appointment of a special
manager to carry on the business. See Chaps. X. and XI. As to the principle on
which accounts are to be taken when a business is carried on by the official receiver
and special manager, and at the hearing of the petition the Court is shown to have
no jurisdiction, see Be A. B. ^ Co,, (1900) 2 Q. B. 429.

The directions of the committee of inspection may always be over-ridden by the
creditors or oontributories in general meeting. Sect. 23 (1) of 1890.

Liquidator B. 140 of 1908.— Where the liquidator carries on the business of the company, he

not to profit) f^^^n j^^^^ without the express sanction of the Court, purchase goods for the
carrying on of such business from any person whose connection with the liquidator
is of such a nature as would result in the liquidator obtaining any portion of the
profit (if any) arising out of the transaction. [Formerly B. 157 of 1890, taken from
Bkcy. R. 816.]

A member of the committee of inspection is also forbidden to receive without the
Court's sanction payment out of the assets '* for any goods supplied by him to the
liquidator for or on account of the company,'' and any such payment by him may
be disallowed by the Board of Trade on the audit of the liquidator's accounts. See

B. 140 of 1903.

B. 142 of 1908. — In any case in which the sanction of the Court is obtained
under the two last preceding rules, the cost of obtaining such sanction shall be
borne by the person in whose interest such sanction is obtained, and shall not
be payable out of the company's assets. [Formerly B. 159 of 1890, taken from
Bkcy. B. 316.]

As to the liquidator beiug forbidden, except by leave of the Court, to purchase
assets of the company, see B. 139 of 1903.

Where the liquidator carries on the business, he must keep a distinct account of
the trading, which must be verified and submitted to and audited by the committee
of inspection, or, if there is no such committee, by the official receiver, in the
manner pointed out in Chap. XXIV.

As to obtaining leave to open a special banking account, see Forms 202, 246.
Sub-agents. -^ ^ liquidator's liability for the negligence and misconduct of his employees,

see Meiferttein v. Eastern Agency Co., 1 T. L. B. 595 ; Mitchell v. Mitchell, 52 L. T.
179 ; New Zealand Land Co, v. Watson, 7 Q. B. D. 374 ; Boustead on Agents, 175 ;
Jobton V. Palmer, (1893) 1 Ch. 71.

But it behoves liquidators who are about to carry on the business of a company
in liquidation to consider their liability under the Workmen's Compensation Act,
1897 (60 & 61 Vict. c. 37). It would seem that the liquidator in carrying on the
business is to be regarded as acting for the company (see Anglo^ Moravian Co,, 1

C. D. 130 : Graham v. Edge, 20 Q. B. D. 683), and is therefore not an '^employer"
within the Act. A receiver is in a different position. Burt v. Burt, (1895) 1 Q. B.
205, 271 . It may, however, be desirable to insure against liability under the Aot.



Cost of
sanction.



Accouuts.



Digitized by



Google



CABBTING OK THE BUSINESS. 343

Let all parties oonoemed attend, &o., on the hearing of an applicon Form 251.
of the [off recr and] liqr of the above-named coy that the applicant Summons for
may be at liberty to carry on the business of the sd coy for the speuse Ubertj to

of calendar months from the date of the order to be made J|^J^

hereon, so far as may be necessazy to complete contracts already made
by the sd coy, and to undertake contracts to an extent not exceeding
what may be necessary to sell the land, buildings, and business of the
sd coy as a going concern [or as the case may he]^ or for such other
period and for such purposes as the Ot shall direct.

SometimeB it may be desirable to add —

And that directions may be given as to what insurance (if any) the
applicant should effect against liability under the Employers' Liability
Act, 1880, the Workmen's Compensation Act, 1897, or otherwise, to
workmen employed in the sd business, and as to how the premiums
for such insurance should be raised and pd.



Upon the applicon of the liqrs. Order that the liqrs be at liberty Porm
until further order to carry on the business of the sd coy, so far as -,^^
may be necessary to complete contracts already made by the sd coy, oarry on
and to undertake contracts to an extent not exceeding what may be )^^^-^fjx
necessary to sell the land, buildings, and business of the sd coy as a
going concern, and to use up the stocks of iron and other materials,
whether manufactured or not, in the liqr's possession, but so that the
price for such further contracts, with the exception of the one specified
under letter G in the second schedule of the sd afft, shall not exceed
1,000/., and so that any such further contracts shall not take more than
six months to complete. Emmerson^ Murgatroyd Sf Co,, Pearson, J.,
19th Nov. 1883. A. 1691.



Upon the applicon of B. M., the off liqr of the above-named coy, Form 253.
and upon hearing counsel for the applicant, and upon reading the £.~ , .
orders dated resply, &c., two affts, &c.. Order that the off liqr be at carry on for
liberty to carry on the works and business of the sd coy for the space "* months.
of six calendar months from the date of this order, or until further
order, and that for that purpose he may be at liberty to pay out of the
moneys from time to time in his hands the salaries, wages, and remu-
nerations of the persons employed in the said works and business, and
also all such rents, royalties, taxes, and other outgoings as may from
time to tim,e become due and payable in respect of such works and
premises, and also for the purpose of carrying on the sd works and



Digitized by



Google



344 WINDING-UP BY THE COURT. [ChAP. XXVI.

business to make snoli purchases as may be proper in the ordinaiy
course of. business, for cash or otherwise, of goods, and to pay the
purchase-money out of such moneys as afsd, and from time to time,
for the same purpose, to make such sales of the efiPects of the sd coy as
may be necessary or proper in the ordinary course of business ; And
order that the applicant, for the purpose of carrying on the business, may
retain in his hands such sum or sums of money as may be necessary, with
power to draw, accept, make, and indorse any necessary bills of
exchange or promissory notes in the name and on behalf of the sd
coy, and generally to execute and do all such other things as may be
necessary or incidental to the carrying on the sd business without the
sanction or intervention of the judge. And order that the applicant
do, on or before the 1st day of Nov. 1886, leave at the chambers of
the judge a report in writing under the hand of the applicant showing
the result of the carrying on of the coy's business, pursuant to the
order up to the date of such report. [And order that the off liqr be
at liberty, in addition to the account at the Bank of England to be
opened by him pursuant to the order of 16th April, 1886, to open a

banking accoimt at the Chesterfield branch of the Bank, Limtd,

and that the account so to be opened be called "The Works Account,"
and that the applicant be at liberty to pay into such account all moneys
which may arise from the carrying on of the business of the ooy
pursuant to this order, and that the applicant be at liberty to draw
against the sd Works Account for all moneys required by him for
carrying on the business. And order that if and whenever the balance
of the sd Chesterfield branch shall exceed 1,000/., the excess thof shall
forthwith be transferred by the applicant into the account of the
off liqr at the Bank of England.]— -iJ© Oliver ^ Co., Chitty, J.,
9th Aug. 1886.

The words in brackets show the practioe prior to 1891 as to a local aooount ; but
as to the present practice, see sect. 11 (3) of 1890 and Chaps. XXTT. and XXV.



Form 254.

Liberty to
carry on for
six weeks
with view to
sale as g^ing
concern.



Upon the applicon of B., the off liqr of the sd coy, by summons
dated, &c., and upon hearing the solors for the applicant, and upon
reading an order dated, &c., and an afft of, &c.. It is ordered that the
sd B., as such off liqr as afsd, be at liberty for the period not exceed-
ing six weeks from the date of this order, to manage and carry on the
business of the above-named coy so far as may be necessary and
proper to execute orders already reed, or which during such period of
six weeks may be reed, and to undertake contracts to an extent not
exceeding what may be necessazy to sell the business of the sd ooy as
a going concern, and to use up the stocks of stoves, iron, copper, and
other materials, whether manufactured or not, in the off liqr's posses-



Online LibraryCharles Mac Naughten Sir Francis Beaufort PalmerCompany precedents for use in relation to companies: subject to ..., Volume 2 → online text (page 46 of 152)