78

SECRETARIAL PRACTICE
in the absence of a satisfactory explanation and the ad-
judication mark of the Revenue Stamp office should be
required under section 12 of the Stamp Act.

With regard to transfers for nominal consideration, the
[nland Revenue Circular, dated January 1927, should be
followed (see Appendix A, p. 385).

[t has been held that directors may refuse to register a
transfer not duly stamped, and in determining whether it is
duly stamped they may go behind that which appears on
the face of the document [Maynard v. Consolidated Kent
Collieries (1903), 2 K.B. 121].

Cancellation Certificates attached to transfers lodged for registration,
_—_ as in the case of certificates in respect of transfers left for
* certification, should be cancelled immediately they are
delivered to the company, so as to prevent any chance
of their being subsequently made use of for an improper

purpose.

The deed of transfer lodged for registration having been
found in order, and being accompanied by a certificate, or
bearing on its face the company’s certification, is stamped
with the date of lodgment, given its consecutive number,
and entered in the Register of Transfers where this book is
kept (Form 22).

Where directors are given a discretion as to registering
transfers, they must not exercise that discretion capriciously.
The Court, in the absence of evidence to the contrary, will
presume that the directors have done right [re Coalport
China Co. (1895), 2 Ch. 404], and the onus of proof is on those
who say the directors have not acted bond fide [ex parte
Penney (1873), 8 Ch. App. 446]. If they have bond fide
considered the matter, the directors need not give their
reasons for refusing to register a transfer, but if they do give
reasons the Court will inquire into the sufficiency of such
reasons [re Bell Brothers, ex parte Hodgson (1892), 65 L.T.
245]. In this connection it must be remembered that a
power to directors to refuse to register transfers of shares
if ‘in their opinion it is contrary to the interests of the com-
pany that the proposed transferee should be a member
thereof’ only justifies a refusal on grounds personal to the
proposed transferee. re Bede Steam Shipping Co. (1917)
1 Ch. 123.] If registration is refused notice must be given
to the transferee within two months of the lodgment of the
transfer (s. 66). A person in whose favour shares are re-
nounced is not a transferee, so that directors with power to
refuse to register transfers are not thereby entitled to refuse

Withholding
Registration.