50 
~ SECRETARIAL PRACTICE 
is the difference between the price paid for the shares and 
their real value at the time of allotment, such value being 
ascertained in the light of subsequent events. The loss to 
the company would appear to be the total nominal value of 
the shares if the applicant avoids the allotment. 
The meaning of ‘knowingly’ should not be overlooked. 
It means ‘with knowledge of the facts.’ ‘Ignorance or mistake 
of law cannot be admitted as an excuse for disobeying an 
Act of Parliament’ [see Twycross v. Grant (1877), 2 C.P.D. 
469]. It would seem, then, that when once it has been 
proved that a director or other official of a company knows 
the facts, 7.e. that shares have been allotted in a particular 
manner, it must be assumed that he knows whether the 
particular manner adopted is the right method, and if it 
contravenes the law he will be liable. 
This chapter has thus far dealt with first allotments. It 
now remains to deal with other provisions of the Act, which 
relate to all allotments. 
In the case of a company making an offer of shares to the 
public, 4.e. issuing a prospectus, or its equivalent, the 
provision that the amount payable on application is not to 
be less than 5 per cent. of the nominal amount of the share 
[s. 39 (3)] applies to subsequent public issues as well as to 
the first [s. 39 (6)]. And the important requirements of 
s. 42 apply to all allotments by all public companies. Sub- 
sections (1) and (2) of that section run as follows: — 
Return as to (1) Whenever a company limited by shares or a company 
Allotments. }iited by guarantee and having a share capital makes any 
allotment of its shares, the company shall within one month 
thereafter deliver to the Registrar for registration— 
(a) a return of the allotments, stating the number and 
nominal amount of the shares comprised in the allot- 
ment, the names, addresses, and descriptions of the 
allottees, and the amount (if any) paid or due and 
payable on each share; and 
in the case of shares allotted as fully or partly paid up 
otherwise than in cash, a contract in writing con- 
stituting the title of the allottee to the allotment, 
together with any contract of sale, or for services 
or other consideration in respect of which that allot- 
ment was made, such contracts being duly stamped; 
and a return stating the number and nominal amount 
of shares so allotted, the extent to which they are to 
be treated as paid up, and the consideration for 
which they have been allotted.