TRANSFER AND TRANSMISSION OF SHARES 83 
If a mortgagee of shares, holding a transfer in blank, pur- 
ports to sell them, and hands over to his purchaser the 
transfer still in blank, the fact that it is in blank affects the 
purchaser with notice, and he gets no better interest than his 
vendor (the mortgagee) had [France v. Clarke (1884), 26 Ch. 
D. 257]. But if the mortgagee himself fills in the transfer, his 
transferee, provided he be a bond fide purchaser for value 
without notice, will get a complete title to the shares [Easton 
v. London Joint Stock Bank (1887), 34 Ch. D. 95]. 
A forged transfer gives no rights to the shares to the alleged 
transferee [Barton v. London & North-Western Railway (1889), 
24 Q.B.D. 77]; but where a company acting on a forged 
transfer has issued a certificate in the name of the transferee 
and this has been passed on to a bond fide holder for value, 
the company is estopped by its certificate from denying 
that the person named in such certificate is the proprietor of 
the shares, and he is entitled to damages against it [Balkis Co. 
v. Tomkinson (1893), A.C. 396]. The Court will order the 
Company to rectify its register where it has acted on a forged 
transfer [re Bahia Railway (1868), L.R. 3 Q.B. 584]. 
By the Forged Transfers Acts, 1891 and 1892 (54 & 55 Vict. 
c. 43; 55 & 56 Vict. c. 36), companies may make compensation 
for losses arising from forged transfers, or transfers under 
forged powers of attorney. Whether or not a company by 
its articles adopts the Acts, or whether or not by resolution it 
does so, none the less the Acts apply; and even although the 
Acts have been adopted by the articles, or by resolution, 
there is not the least obligation on the company to make any 
compensation whatever. The compensation is payable out 
of the company’s funds, and the company may, if it pleases, 
establish a compensation fund by charging a fee on transfers, 
not exceeding one shilling per £100 transferred, or by insur- 
ance, or reservation of capital, or accumulation of income, or 
in any other manner. The object of the Acts is to enable a 
company to benefit a purchaser who finds himself deprived 
of his shares owing to the registration of a forged transfer, or 
a transfer under a forged power of attorney. If a company 
pays compensation under the Acts, the rights of the person 
compensated against the person who has caused the loss are 
transferred to the company. 
To provide for the cases of the death, bankruptcy, or 
insolvency of a member, a transmission clause is almost 
invariably inserted in the articles. It must be remembered 
that transfer and transmission are two distinct things. Trans- 
mission occurs on death, bankruptcy, &c., when the power 
of transfer no loneer exists. and secures that there shall 
Forged 
Transfers. 
Transmission