SECRETARIAL PRACTICE
A power of forfeiture must not be exercised in the interests
of a shareholder to enable him to escape liability, but in the
interests of the company [Spackman v. Evans (1868), L.R.
3 H.L. 171].
Notwithstanding forfeiture a shareholder is liable to pay all
calls owing at the time of the forfeiture, with interest, if the
regulations so provide [Stocken’s Case (1868), 3 Ch. App. 412].
And where shares have been forfeited for non-payment of
calls and re-sold, then (though Table A of 1862, cl. 22, applies)
fresh calls may be made on the purchaser for the unpaid
amount [New Balkis Eersteling v. Randt Gold Mining Co.
1904), A.C. 165]. But he is entitled, in the absence of
agreement to the contrary, to be credited with sums paid
by the original holder since forfeiture [re Randt Gold Mining
Co. (1904), 2 Ch. 468]. It has been held that where by the
articles of association a member is not entitled to vote when
calls are due from him, and is liable to pay the calls even after
forfeiture, the purchaser of shares forfeited for non-payment of
calls is not entitled to vote so long as the calls are unpaid by
the original holder [Randt Gold Mining Co. v. Wainwright
(1901), T Ch. 184].
The articles generally contain a power for the directors to
annul a forfeiture. But such a power cannot be exercised
adversely to the former shareholder, so as to make him liable
for calls made subsequently [re Exchange Trust, Larkworthy’s
Case (1903), 1 Ch. 711].
A Form of Resolution of the board to forfeit shares will be
found in Chapter XIV.
A bond fide forfeiture made in accordance with the regulations
 of the company will not be disturbed by the Courts
(Sparks. v. Liverpool Waterworks Co. (1807), 13 Ves. 428].
A shareholder may bring an action to set the forfeiture aside
if he desires to test its validity [Sweney v. Swath (1869),
7 Eq. 324]. A slight irregularity, e.g. claiming interest
from date of call instead of date of payment, is sufficient for
the Court to annul a forfeiture [Johnson v. Lyttle’s Iron
Agency (1877), 5 Ch. D. 687]. Forfeiture will be restrained
pending the trial of an action for rescission upon proper terms.
In Jones v. Pacaya Rubber Co. (1911), 1 K.B. 455 and Lamb
v. Sambas Rubber Co. (1908), 1 Ch. 845, the injunction was
granted subject to payment into Court of the amount due on
the shares. In these cases, however, the shareholder consented
 to make such payment and in the former case, Buckley
L]J., expressly reserved the question whether if he had been
unwilling to do so, the injunction would have been refused.
In Radium Springs v. How [(1929), not yet reported], the