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 shareholder
 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 constitutes
 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 It may be withdrawn before acceptance, but the offer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 withdrawal
 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.