Secretarial practice

Bibliographic data

Monograph

Identifikator:: 1828236004

URN:: urn:nbn:de:zbw-retromon-249926

Document type:: Monograph

Title:: Secretarial practice

Edition:: fourth edition

Place of publication:: Cambridge

Publisher:: W. Heffer & Sons Ltd

Year of publication:: 1930

Scope:: viii, 987 Seiten

Digitisation:: 2022

Collection:: Economics Books

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Chapter

Document type:: Monograph

Structure type:: Chapter

Title:: Chapter VI. Prospectus and allotment

Collection:: Economics Books

Decisions as to Allotment. 56 SECRETARIAL PRACTICE an undisclosed principal, the principal may be unable to rescind on the ground of misrepresentation contained in the prospectus issued to the agent [Collins v. Associated Grey- hound Racecourses Limated (1929), C. 45, T.L.R. 519]. Applica- tion in a fictitious name, followed by allotment, renders the applicant liable, and his real name may be entered on the register [Hercules Insurance Co., Pugh & Sharman’s Cases (1872), 13 Eq. 566]. Application by a father in the name of his infant son renders the father liable [Imperial Mercantile Association, Richardson’s Case (1875), 19 Eq. 588]. Applica- tion subject to a condition precedent will not give rise to a contract unless the condition is performed [Aldborough Hotel Co. (1870), 4 Ch. App. 184; where a builder applied on con- dition that he should have the building contract]. But if the condition is subsequent—in other words, if it can be construed as a separate agreement, collateral to the agreement to take shares—the applicant will be liable on the shares notwith- standing breach of the collateral agreement [Richmond Hill Hotel Co., Elkington’s Case (1867), 2 Ch. App. 511]. Allotment ‘is generally neither more or less than the acceptance by the company of the offer to take shares’ [per Chitty, J. Nicol's Case (1885), 29 Ch. D. 421]. Below are some of the more important decisions on allot- ment: An improperly constituted board of directors has no power to act for the company, and therefore an allotment by such a board will be invalid [re Homer District Gold Mines (1889), 39 Ch. D. 546]. But an allotment by an irregularly constituted board may be subsequently ratified by a regular board [Portuguese Copper Mines, Badman's and Bosanquet's Cases (1890), 45 Ch. D. 16]. Directors cannot delegate their power to allot [Leeds Banking Co., Howard's Case (1866), 1 Ch. App. 561], unless by the articles they are authorised to do so [Harris's Case (1871), 7 Ch. App. 587]. The power of directors to allot is a fiduciary power, which must be exercised bond fide for the benefit of the company as a whole, and not for their own ends, e.g. to maintain their control, or to defeat the wishes of the majority of the shareholders [Piercy v. S. Mills & Co. (1920), 1 Ch. 77; see also Gas Meter Co. v. Diaphragm, etc., Co. (1925), 41 T.L.R. 342]. Allotment must be made within a reasonable time after application; otherwise the allottee may refuse to accept the shares [Ramsgate Hotel v. Montefiore (1865), 4 H. & C. 164]. It must be communicated, though the communication need not necessarily be in writing [Gunn's Case (1867), 3 Ch. App. 40; Lewta’s Case (1867), 3 Ch. App. 30]. Generally

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