292 SECRETARIAL PRACTICE
its existence and are therefore immaterial for this purpose.
It would appear that the company is still entitled to the last
two privileges, for the sub-section does not state that the
company shall cease to be a private company, but that certain
provisions shall apply to the company as if it were not a private
company.

Relief from the consequences of default may be granted
by the Court upon grounds set out in the proviso to s. 27 (3)
of the Act.
By s. 111 of the Act a private company is required to
send with the annual return:—(a) A certificate signed
by a director or the secretary that the company has
not, since the date of the last return, or in the case of a first
return since the incorporation of the company, issued any
invitation to the public to subscribe for shares or debentures
of the company; and (b) if the list of members exceeds fifty,
a similar certificate that the excess consists wholly of em-
ployees or ex-employees. The object of this provision is
that the authorities may be satisfied that the company is
still entitled to the privileges of a private company.

The reduction of the number of members of a private
company below two is a ground for the company being
wound up by the Court [s. 168].

Commissions. It has been expressly decided that a private company,
like any other company, may pay commissions for subscrip-
tions, or procuring subscriptions for its capital, subject to
the provisions of s. 43 of the Act [Dominion of Canada
Trading” Syndicate v. Brigstocke (1911), 2 K.B. 648]. The
conditions to be complied with are as follows :

{1) The payment must be authorised by the articles;

(2) The commission must not exceed ten per cent. of the
price at which the shares are issued, or the amount or rate
authorised by the articles, whichever is the less.
(3) The amount or rate must be disclosed in a statement
in the form prescribed (see Form 58 in Companies (Forms)
Order, 1929), signed in the same manner as a statement in lieu
of prospectus (z.e. by the directors, or their agents authorised
in writing), and delivered to the Registrar for registration.

(4) The amount or rate must be disclosed in any circular or
notice, not being a prospectus, inviting subscriptions.

(5) The number of shares which persons have agreed for
a commission to subscribe absolutely must be disclosed in
like manner