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 V. Capital and shares

Collection:: Economics Books

CAPITAL AND SHARES 35 for an order confirming the reduction (ss. 55, 56). The power to reduce may be exercised in any way whatever [see Poole v. National Bank of China (1907), A.C. 229], although the Act particularises three ways, namely (a) by extinguishing or reducing the liability on any of its shares in respect of share capital not paid up; (b) either with or without extinguishing or reducing liability on any of its shares by cancelling paid-up capital which has been lost or is unrepresented by available assets; and (c) either with or without extinguishing or reducing liability on any of its shares, by paying off any paid-up share capital which is in excess of the wants of the company (s. 55). In certain instances there is a practical reduction which can be effected without the sanction of the Court, e.g. by for- feiture of shares or by surrender (see Chapter IX). S. 40 of the Act of 1908, which gave power to pay off paid up capital out of accumulated profits was repealed by the Act of 1928. Where the articles of a company, as originally framed, or as altered by special resolution, authorise it, shares not taken or agreed to be taken may be cancelled, and the nominal capital thus reduced without application to the Court (s. 50). If the original articles do not give the power they must first be altered in the usual way by special resolution, and the special resolution for reduction subsequently passed [Patent Invert Sugar Co. (1886), 31 Ch. D. 166]. A power to reduce contained only in the memorandum is ineffective (re Dexine Co. (1903), W.N. 82]. The precise procedure to be adopted to effect a reduction depends upon whether or not the re- duction involves either the diminution of liability in respect of unpaid capital, or the return to shareholders of paid-up capital. If either of these is involved, creditors are clearly affected and may object [s. 56 (2)]; but in the more common case where paid-up capital has been lost, or is unrepresented by available assets, creditors are not prejudiced, and in such cases, and indeed in any case other than the two cases speci- fically mentioned in s. 56 (2), can only object if the Court so allows. The petition is supported by affidavit evidence. An affidavit by the chairman of directors commonly sets out the history of the company, and the circumstances leading to the present position; whilst the secretary should depose to the due calling of the meetings of the company. In the case where the reduction is sought to be effected on the ground of capital lost or unrepresented by available assets, evidence of the loss should always be adduced [Caldwell v. Caldwell (1916), W.N. 70].

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