38 
SECRETARIAL PRACTICE 
this section must be made within seven days after the consent 
was given or the resolution passed. The Court must confirm 
the variation unless it is satisfied that having regard to all 
the circumstances of the case the variation would unfairly 
prejudice the shareholders of the class represented by the 
applicant and there is no appeal from an order of the Court 
under this section. A copy of any order of the Court under 
this section must be forwarded by the company to the Regis- 
trar of Companies within 15 days after the making of the 
Order. The expression ‘variation’ in this section includes 
‘abrogation.’ It will be noticed that the onus of proof is 
on the dissentient minority. 
Shares may be divided into any number of classes, e.g. 
Preferred, Ordinary, ‘A’ Preference, ‘B’ Preference, and 
so forth. 
The preferential right is generally in respect of capital and 
of dividend, but the right may be of any kind, e.g. in respect 
of voting power. These rights are entirely separate, and the 
possession, e.g. of preferential rights as to dividend, gives no 
similar right in the distribution of capital [Simpson v. Palace 
Theatre (1893), 69 L.T. 70]. 
Primd facie where a preferential dividend is provided for, 
it is cumulative [Webb v. Earle (1875), 20 Eq. 556]; i.e. a 
deficiency in one year can be paid out of the profits of a 
subsequent year before the ordinary shareholders receive 
anything; but if it is provided by the memorandum that the 
holders of preference shares shall be entitled out of the net 
profits of each year to a preferential dividend at a certain 
rate, then such dividend is not cumulative [Staples v. Eastman 
Photographic Materials Co. (1896), 2 Ch. 303; see also Adair 
v. Old Bushmills (1908), W.N. 24]. 
Where capital is reduced, the presumption is that the loss 
is to be borne as between classes of shareholders in the same 
way as loss of capital, but the Court can sanction anv reduction 
it thinks fair. 
Special voting rights can be attached to different classes 
of shares, and it has been held that these are alterable, when 
given by the articles [re James Colmer (1897), 1 Ch. 524]. 
The question sometimes arises whether preference shares are 
entitled in the absence of express provision to participate 
in the distribution of surplus assets after all capital has been 
repaid. In each case it is a question of construction of the 
memorandum and articles. The authorities are difficult to 
reconcile; the latest decision, in which all the authorities 
are reviewed is in Collaroy Company v. Giffard (1928), Ch. 144.