PROSPECTUS AND ALLOTMENT 55
to their existing holdings, a circular letter is commonly sent
out accompanied by a specific offer to each individual holder,
on which is a form of acceptance of the offer, with receipt for
the first instalment attached. If it is desired that the share-
holder or debenture holder should be able to renounce his
right and nominate another person to exercise it, the form
may include a letter of renunciation. Form 15 may be
used for this purpose, either wholly or in part, according to
the circumstances of the case.

An allotment letter requires a penny stamp if the value of
the shares allotted is less than £5, and a sixpenny stamp
(impressed) if the value is £5 or over. The same scale of
duty applies to letters of renunciation, but the stamp may
be adhesive even if the value is over £5 (Finance Act, 1899,
62 & 63 Vict. c. 9, s. 9) The fractional part of a share must
be stamped on the same basis, both in the case of letters of
allotment and letters of renunciation (Revenue Act, 1909,
9 Ed. VII, c. 43, s. 9).- The bankers’ receipt, if attached to
the allotment letter, does not require a separate stamp
[London & Westminster Bank v. Inland Revenue Commissioners
(1900), 1 Q.B. 166].

Inasmuch as the agreement to become a member is often
constituted by application and allotment, and agreement to
become a member followed by entry on the register con-
stitutes membership of a company (s. 25) with all its attendant
rights and liabilities, it is important to appreciate the effect
of a number of legal decisions on the subjects of application
and allotment.

The following are amongst the chief points to be observed
with regard to an application for shares:

It need not be in writing [Levita’s Case (1867), 3 Ch. App.
36]. It may be withdrawn before acceptance, but the offer
remains open until the letter of revocation is actually received
[Byrne v. Van Tienhoven (1880), 5 C.P.D. 344]. The with-
drawal need not be in writing; and may be communicated
to the secretary, or, in his absence, even to a clerk in charge
[Truman's Case (1894), 3 Ch. 272}. The doing of some act
inconsistent with the continuance of the offer, done to the
knowledge of the company, may be an effective withdrawal
[Dickinson v. Dodds (1876), 1 Ch. D. 463]. The application
may be made by an agent [Hannan’s Empress Co. (1896),
2 Ch. 643]; but unless the agent informs the company that he
takes the shares as agent and not as principal he may be
personally liable in respect of them [Southampton Steamboat
Company (1864), 4 De G.J. & S. 200]. Moreover, if the
allotment is made to the agent and he renounces in favour of

Decisions
as fo
Applications.