Company - 1849- 1899

Company Law, including Partnership, Company Director Disqualification. See also Insolvency.

These cases are extracted from a very large database. The entries on that database are now being published individually to the main swarb.co.uk website in a much improved form. As cases are published here, the entry here will be replaced by a link to the same case in that improved form on swarb.co.uk. In addition the swarb.co.uk site includes very substantial numbers of cases after 2000. Please take the time to look.  

This page lists 132 cases, and was prepared on 18 May 2014. These case are being transferred one by one to the main swarb.co.uk site which presents them better, with links to full text where we have it, and much improved cross referencing.
In The Matter Of The Liverpool And Manchester Saw Mills And Timber Joint Stock Company And In The Matter Of The Joint Stock Companies Winding-Up Act, 1848 Holt's Case [1849] EngR 904 (A); (1849) 3 De G & Sm 99
4 Aug 1849

Company
[ Commonlii ]
Ex Parte Inderwick In The Matter Of The Great Munster Railway Company And In The Matter Of The Joint Stock Companies Winding-Up Acts, 1848 And 1849 [1850] EngR 609; (1850) 3 De G & Sm 231; (1850) 64 ER 457
1 Jun 1850

Company
Link[s] omitted
The West Cornwall Railway Company -v- Mowatt; 04-Jun-1850
The Sunderland Marine Insurance Company -v- Matthew Kearney And Robert Noonan [1851] EngR 411; (1851) 16 QB 925; (1851) 117 ER 1136
2 May 1851

Company
[ Commonlii ]
Smith -v- Mules; 17-Feb-1852
Blisset -v- Daniel (1853) 10 Hare 493
1853

Page-Wood V-C
Company
1 Citers
The court considered the limits on a power of expulsion from a partnership. Held: (Page-Wood V-C) Construing the articles, two-thirds of the partners could expel a partner by serving a notice upon him without holding any meeting or giving any reason. But the power must be exercised in good faith: "the literal construction of these articles cannot be enforced" and, after citing from the title "De Societate" in Justinian's Institutes, went on: "It must be plain that you can neither exercise a power of this description by dissolving the partnership nor do any other act for purposes contrary to the plain general meaning of the deed, which must be this, that the power is inserted, not for the benefit of any particular parties holding two-thirds of the shares but for the benefit of the whole society and partnership . . ." In the Australian case of In re Wondoflex Textiles Pty. Ltd. [1951] V.L.R. 458, 467, Smith J. also contrasted the literal meaning of the articles with the true intentions of the parties: "It is also true, I think, that, generally speaking, a petition for winding up, based upon the partnership analogy, cannot succeed if what is complained of is merely a valid exercise of powers conferred in terms by the articles. . . . To hold otherwise would enable a member to be relieved from the consequences of a bargain knowingly entered into by him. . . . But this, I think, is subject to an important qualification. Acts which, in law, are a valid exercise of powers conferred by the articles may nevertheless be entirely outside what can fairly be regarded as having been in the contemplation of the parties when they became members of the company; and in such cases the fact that what has been done is not in excess of power will not necessarily be an answer to a claim for winding up. Indeed, it may be said that one purpose of [the just and equitable provision] is to enable the court to relieve a party from his bargain in such cases."
In re The Midland Union, Burton-Upon-Trent, Ashby-De La-Zouch And Leicester Railway Company; And In The Matter Of The Joint Stock Companies Winding-Up Acts Sir Wm Pearson's Executors' Case [1853] EngR 96; (1852, 1853) 3 De G M & G 241; (1853) B)
15 Jan 1853

Company
Link[s] omitted
In The Matter Of The Dover And Deal Railway, Cinque Ports, Thanet, And Coast Junction Company, And Of The Joint-Stock Companies Winding-Up Acts, 1848 And 1849 Mowatt And Elliott's Case [1853] EngR 226; (1853) 3 De G M & G 254; (1853) 43 ER 100
8 Feb 1853

Company
[ Commonlii ]
Aberdeen Rly Co -v- Blackie Bros (1854) 1 Macq 461
1854

Company
In the absence of any provision otherwise in the articles aof association, a contract made by the company in which a director holds a contrary interest will be voidable at the instance of the company.
Aberdeen Railway Co -v- Blaikie Brothers; HL 1854
Robert Hull Terrell -v- James Button; 16-Mar-1854
Regina -v- The Registrar of The Pharmaceutical Society of Great Britain; 1855
The Royal British Bank -v- Turquand [1855] EngR 531; (1855) 5 El & Bl 248; (1855) 119 ER 474
2 Jun 1855

Company
1 Citers
Link[s] omitted
Royal British Bank -v- Turquand; CEC 1856
In The Matter Of The Saint Marylebone Joint Stock Banking Company, And In The Matter Of 'The Joint Stock Companies Winding-Up Acts, 1848 And 1849' Dr Walker's Case [1856] EngR 885; (1856) 8 De G M & G 607; (1856) 44 ER 524
11 Nov 1856

Company
Link[s] omitted
Brown -v- Oakshot (1857) 24 Beav 254
1857

Company, Equity
1 Citers
A father devised his estate to trustees for a term, for them to pay a residue of rents from that estate to his sons as tenants in common; but the reversion of the estate he devised to his sons as joint tenants. The question was whether the joint tenancy of the reversion had been severed because the sons, during the term, had used the estate in their partnership trade as brewers. Held: They had not, and so the surviving son took the whole of the reversion, subject to the term.
In The Matter Of The British Sugar Refining Company And In The Matter Of The Joint Stock Companies Act, 1856; 18-Feb-1857
Reid's Case In Re The Electric Telegraph Company Of Ireland; 25-Jul-1857
Maxwell's Case Re The Electric Telegraph Company Of Ireland; 25-Jul-1857
The Electric Telegraph Company Of Ireland Cookney's Case; 19-Jul-1858
In The Matter Of The Electric Telegraph Company Of Ireland, And In The Matter Of The Joint Stock Companies Winding-Up Acts, 1848 And 1849 Cookney's Case; 03-Nov-1858
The Metropolitan Saloon Omnibus Company -v- Hawkins; CEC 02-Dec-1858
Attorney-General -v- Great Northern Railway Co; 1860
Ashworth -v- Stanwix (1860) 3 E & E 701
1860
QBD
Vicarious Liability, Company Casemap
1 Citers
Innocent partners are vicariously liable for the torts of their co-partner.
In Ex Parte Harris, Re The Anglo-French Porcelain Company (Limited), And The Anglo-French Porcelain Company (Limited) -v- Harris [1860] EngR 759; (1860) 5 H & N 809; (1860) 157 ER 1404
22 May 1860

Company
[ Commonlii ]
Cooper -v- Hubbuck [1860] EngR 1297; (1860) 30 Beav 160; (1860) B)
19 Dec 1860

Company, Legal Professions
A partnership between two solicitors for their joint lives may be dissolved instanter, if one of the parties fraudulently sells out trust funds and applies the produce to his own use.
Link[s] omitted
Andrewes -v- Garstin (1861) 10 CB (NS) 444
1861

Erle CJ
Company Casemap
1 Citers
The plaintiff sued for breach of an agreement to enter into a partnership with the defendant, who pleaded that previously the plaintiff had carried on trade in partnership with another person, and that the defendant made the agreement on the faith and under the belief that the plaintiff had up to that time acted with honesty towards his previous partner. But after the making of the agreement the defendant discovered that the plaintiff had before the time of making the agreement acted with fraud and dishonesty towards his partner, and did not disclose it. Held: The plea was no answer to the action. The defendants arguments would have been addressed with more plausibility if the plea had been a little more specific. There was no suggestion of fraud on the defendant and as to the rest it was much too vague and uncertain.
Thomas -v- Hobler [1861] EngR 1074; (1861) 4 De G F & J 199; (1861) 45 ER 1160
18 Dec 1861

Company
Link[s] omitted
In Re The Risca Coal And Iron Company [1861] EngR 1076; (1861) 30 Beav 528; (1861) 54 ER 994
21 Dec 1861

Company
Link[s] omitted
Milroy -v- Lord (1862) 4 De GF & J 264; [1862] EWHC Ch J78; [1862] EngR 951; (1862) 4 De G F & J 264; (1862) 45 ER 1185
26 Jul 1862
CA
Knight-Bruce LJ and Turner LJ
Company, Equity, Trusts
1 Citers
The donor executed a transfer of 50 shares. The shares were only transferable by entry in the books of the bank. No such transfer was ever made. The defendant had a power of attorney authorising him to transfer the donor’s shares and after the deed the donor gave him a further power of attorney authorising him to receive dividends on the shares. The donor died and an action was bought to enforce the transfer. Held: The transaction was imperfect and incomplete and that the donor might have perfected it and completed it by a transfer. Turner LJ Sid: "in order to render a voluntary settlement valid and effectual, the settlor must have done everything which, according to the nature of the property comprised in the settlement, was necessary to be done in order to transfer the property and render the settlement binding upon him. He may of course do this by actually transferring the property to the persons for whom he intends to provide, and the provision will then be effectual, and it will be equally effectual if he transfers the property to a trustee for the purposes of the settlement, or declares that he himself holds it in trust for those purposes; and if the property be personal, the trust may, as I apprehend, be declared either in writing or by parol; but, in order to render the settlement binding, one or other of these modes must, as I understand the law of this Court, be resorted to, for there is no equity in this Court to perfect an imperfect gift. The cases I think go further to this extent, that if the settlement is intended to be effectuated by one of the modes to which I have referred, the Court will not give effect to it by applying another of those modes. If it is intended to take effect by transfer, the Court will not hold the intended transfer to operate as a declaration of trust, for then every imperfect instrument would be made effectual by being converted into a perfect trust. These are the principles by which, as I conceive, this case must be tried."
Link[s] omitted
Coventry -v- Barclay (1863) 3 De G J & Sm 320; (1863) 3 New Rep 224; (1863) 9 LT 496
1863

Company Casemap
1 Citers
Partners had conducted their practice over many years in a manner inconsistent with the spirit if not the exact letter of their partnership articles. Stock was to be taken every year, and the value entered into the books to be signed off by each partner. On the last occasion a partner being ill did not sign the accounts, and later died. He had not expressed any dissatisfaction with the accounts. Held: His estate was bound by the accounts as if he had signed them. The firm had each year set aside a certain sum against contingencies. The deceased partner's estate was entitled to the return of his share in the fund.
Re Maxwell's Trusts [1863] EngR 381; (1863) 1 H & M 610; (1863) 71 ER 267
23 Mar 1863

Company, Trusts
Link[s] omitted
In Re The Maryport, & Railway Act Ex Parte The Earl Of Lonsdale [1863] EngR 387; (1863) 32 Beav 397; (1863) 55 ER 155
28 Mar 1863

Company
[ Commonlii ]
James Bennett -v- Thomas Goad Blain [1863] EngR 985; (1863) 15 CB NS 518; (1863) 143 ER 887
21 Nov 1863

Company
Link[s] omitted
In re Exhall Coal Mining Co Ltd; CA 1864
In The Matter Of The Companies Act, 1862; And In The Matter Of The Llanharry Hematite Iron Ore Company, Limited Roney's Case Stock's Case [1864] EngR 602; (1864) 4 De G J & S 426; (1864) 46 ER 983
23 Jun 1864

Company
Link[s] omitted
Johnson -v- Helleley [1864] EngR 878 (B); (1864) 2 De G J & S 446
21 Dec 1864

Company
Link[s] omitted
Humber Iron Company -v- Jones [1865] EngR 25; (1865) 4 F & F 1047; (1865) A)
1865

Company
Link[s] omitted
In re Moseley-Green Coal and Coke Co Ltd, Ex parte Barrett (1865) 12 LT (NS) 193
1865

Lord Westbury LC
Insolvency, Company Casemap
1 Citers
Mr Barrett owed the company money on his partly-paid shares for which calls were made after it went into insolvent liquidation. He had also guaranteed the company's liability for the purchase price of a coal mine, for which the vendor held security in the form of a mortgage and the company's promissory note. After the winding up Mr Barrett's sister paid off the vendor and took over the mortgage and promissory note. Mr Barrett then entered into an arrangement which was treated as a payment of the company's debt and he took over the promissory note. Held: He was entitled to set off the debt on the promissory note against his liability to pay calls on his shares.
Pilling -v- Pilling (1865) 3 De G J & Sm 162
1865

Company Casemap

Bows -v- Hope Life Insurance and Guarantee Co [1865] 11 HL Cas 389
1865
HL
Lord Cranworth
Company, Insolvency Casemap

In the case of a creditor's petition not opposed by other creditors: "I agree with what has been said, that it is not a discretionary matter with the court when a debt is established, and not satisfied, to say whether the company should be wound up or not; that is to say if there be a valid debt established, valid both at law and in equity. One does not like to say positively that no case could occur in which it would be right to refuse it; but, ordinarily speaking, it is the duty of the court to direct the winding up. "
Jones -v- Lock (1865) LR 1 Ch App Cas 25
1865

Lord Cranworth LJ
Company, Equity
1 Citers
A father put a cheque into the hands of his baby son of nine months saying ‘I give this to baby for himself’ and he then took back the cheque and put it away. The donor died and the cheque was found among his effects. Held: There had been no valid gift. There was no declaration of trust and no gift.
Bonville -v- Bonville [1865] EngR 777; (1865) 35 Beav 129; (1865) A)
14 Dec 1865

Company
[ Commonlii ]
Griffiths -v- Bracewell, Bracewell -v- Griffiths [1865] EngR 788; (1865) 35 Beav 43; (1865) 55 ER 810
19 Dec 1865

Company
Link[s] omitted
Henry Wickham Wickham And Others, On Behalf Of Themselves And The Debenture-Holders In The New Brunswick And Canada Railway And Land Company -v- The New Brunswick And Canada Railway Company And Others [1865] EngR 793; (1865) 3 Moo PC NS 416; (1865) 16 ER 158
22 Dec 1865
PC
Company
[ Commonlii ]
In re Overend Gurney & Co (Grissell's case); 1866
The Glamotgansgire Iron And Coal Companu -v- Irvine [1866] EngR 45; (1866) 4 F & F 947; (1866) 176 ER 861
1866

Company, Torts - Other
Link[s] omitted
George Rolfe And Edward Bailey, And The Bank Of Australasia -v- Flower, Salting And Company [1866] EngR 75; (1866) 3 Moo PC NS 365; (1866) 16 ER 139
1 Feb 1866
PC
Company, Insolvency
Link[s] omitted
Re The Hop And Malt Exchange And Warehouse Company Brigg's Case (Limited) [1866] EngR 84; (1866) 35 Beav 273; (1866) 55 ER 900
8 Feb 1866

Company
Link[s] omitted
Re Hafod Lead Mining Company Slater's Case [1866] EngR 97; (1866) 35 Beav 391; (1866) 55 ER 947
13 Feb 1866

Company
[ Commonlii ]
Prince -v- Prince [1866] EngR 102; (1866) 35 Beav 386; (1866) 55 ER 945
15 Feb 1866

Company
Link[s] omitted
In Re The Anglo-Greek Steam Navigation And Trading Company, Limited [1866] EngR 120; (1866) 35 Beav 399; (1866) 55 ER 950
8 Mar 1866

Company
Link[s] omitted
Re The Constantinople And Alexandra Hotel Company [1866] EngR 124; (1866) 35 Beav 349; (1866) 55 ER 930
12 Mar 1866

Insolvency, Company
Link[s] omitted
Lyde, On Behalf, &Amp;C, -v- The Eastern Bengal Railway Company [1866] EngR 132; (1866) 36 Beav 10; (1866) 55 ER 1059
15 Apr 1866

Company
[ Commonlii ]
Re The English, and Co, Rolling Stock Company Lyon's Case [1866] EngR 147; (1866) 35 Beav 646; (1866) 55 ER 1048
2 May 1866

Company
Link[s] omitted
In Re London, Hamburg, and Co Bank Emmerson's Case Toombs' Case [1866] EngR 146; (1866) 35 Beav 518; (1866) 55 ER 997
2 May 1866

Company, Insolvency
Link[s] omitted
The Alexandra Hall Company Roebuck's Case [1866] EngR 152; (1866) 35 Beav 467; (1866) 55 ER 977
8 May 1866

Company
Link[s] omitted
Re The Railway Finance Company (Limited) [1866] EngR 154; (1866) 35 Beav 473; (1866) 55 ER 979
24 May 1866

Company
[ Commonlii ]
Denton -v- Macneil [1866] EngR 159; (1866) 35 Beav 652; (1866) 55 ER 1050
1 Jun 1866

Company
Link[s] omitted
Re The Bahia and San Francisco Railway Co Ltd -v- Trittin and others (1868) LR 3 QB 584
1868
CA
Lord Cockburn CJ, Blackburn J, Lush J, Mellor J
Company, Estoppel

Miss Trittin left her share certificates with a broker. A forged transfer together with the certificates, was lodged with and with registered by the company. The new certificates certified that the named person as registered holder. He then sold them to innocent purchasers who in turn lodged transfers and certificates and obtained certificates in their own names. The company had become obliged to restore Miss Trittin's name to the register but refused to recognise the innocent purchasers as shareholders. A special case was stated for the opinion of the Court between the innocent purchasers as claimants and the company for the purpose of determining the amount of damages (if any) which the company was liable to pay them respectively. Held: The claimant succeeded.
Lord Cockburn CJ: "This power of granting certificates is to give the shareholders the opportunity of more easily dealing with their shares in the market, and to afford facilities to them of selling their shares by at once showing a marketable title, and the effect of this facility is to make the shares of greater value. The power of giving certificates is, therefore, for the benefit of the company in general; and it is a declaration by the company to all the world that the person in whose name the certificate is made out, and to whom it is given, is a shareholder in the company, and it is given by the company with the intention that it shall be so used by the person to whom it is given, and acted upon in the sale and transfer of shares. It is stated in this case that the claimants acted bona fide, and did all that is required of purchasers of shares; they paid the value of the shares in money on having a transfer of the shares executed to them, and on the production of the certificates which were handed to them. It turned out that the transferors had in fact no shares, and that the company ought not to have registered them as shareholders or given them certificates, the transfer to them being a forgery. That brings the case within the principle of the decision in Pickard –v- Sears [6 AD & E 469] as explained by the case of Freeman –v- Cooke [2 Ex 654] that if you make a representation with the intention that it shall be acted upon by another, and he does so, you are estopped from denying the truth of what you represent to be the fact."
Blackburn J referred to the Companies Act and said:- "The statute further provides that the company may give certificates specifying the shares held by the member; and the object of this provision is expressly stated to be that this certificate should be prima facie evidence of the title of the person named to the shares specified; and the company, therefore, by granting the certificate, do make a statement that they have transferred the shares specified to the person to whom it is given, and that he is the holder of the shares. If they have been deceived and the statement is not perfectly true, they may not be guilty of negligence, but the company and no-one else have power to enquire into the matter; and it was the intention of the legislature that these certificates should be documents on which buyers might safely act," and "…. it is quite clear that a statement of a fact was made by the company, on which the company, at the very least, knew that persons wanting to purchase shares might act."
Lush J referred to the certificate given by the company to the fraudsters:- "And the claimants having acted on this statement by the company, there arises an estoppel as against the company, prohibiting them from denying that what it states is true. And the question then is, what does the certificate mean? Does it mean merely, that [the fraudsters' names] are on the register, and the company have done their best to ascertain that they are entitled to the shares, but cannot say whether they are so entitled? Or does it amount to a statement that the company take upon themselves the responsibility of asserting that they are the registered shareholders entitled to the specific shares? I think the certificate must amount to the latter assertion. It is the company who are to keep and look after the register, and they are the only persons who have control over it, and they can refuse to register a person until he shews that he is legally entitled. Having, therefore, put the names of [the fraudsters] upon the register, and granted them a certificate, the company are estopped after that statement has been acted upon and cannot deny that those persons were the legal holders of the particular shares which have been transferred to the claimants. The claimants, therefore, are entitled to recover from the company the value of the shares at the time when they were deprived of them."
In re Richards & Co [1869] 11 Ch D 676
1869

Company, Insolvency
1 Citers
The court refused to sanction a scheme because it treated a creditor with preferential rights in a liquidation as an ordinary unsecured creditor.
Reese River Silver Mining Co Ltd -v- Smith; HL 1869
In re Humber Ironworks and Shipbuilding Co (1869) LR 4 Ch App 643
1869

Selwyn LJ
Insolvency, Company Casemap
1 Citers
The assets of a company held on the statutory trusts should be distributed as if they had all been collected and distributed on the date of the winding up order: "I think the tree must lie as it falls; that it must be ascertained what are the debts as they exist at the date of the winding up, and that all dividends in the case of an insolvent estate must be declared in respect of the debts so ascertained. " No allowance is made for interest accruing after the date of the winding up order.
In re Progress Assurance Co Ex parte Liverpool Exchange Co; 1870
In re Panama New Zealand and Australian Royal Mail Co (1870) 5 Ch App 318
1870

Gifford LJ
Company Casemap

The company had charged its "undertaking and all sums of money arising therefrom". Held: "undertaking" meant "… all the property of the company, not only which existed at the date of the debenture, but which might afterwards become the property of the company." and the word "undertaking" "… necessarily infers that the company will go on, and that the debenture holder could not interfere until either the interest which was due was unpaid, or until the period had arrived for the payment of his principal, and that principal was unpaid".
Re County Marine Insurance Co (Rance's Case); 1870
Henry Bulkeley And Robert Fleming -v- Henry Gerard Schutz And Another [1871] EngR 37; (1871) 8 Moo PC NS 170; (1871) 17 ER 276
17 Jul 1871
PC
Company
A Railway Company and partnership complete and existing in a Foreign Country is not within the purview of the English Joint Stock Companies Acts, 1856, 1857, so as to enable H. B. Majesty's Consular Court in Egypt to issue a sequestration against such of the members of the Company as were resident within the jurisdiction of that Court, for not complying With an Order of that Court to register the Compamy as one of limited liability under the English Acts.
Link[s] omitted
Ambler -v- Bolton; CA 1872
Pickering -v- Stephenson (1872) LR 14 Eq 322
1872

Company
1 Citers
A company’s money should not be expended on disputes between the shareholders.
Mollwo, March and Co -v- The Court of Wards [1872] EngR 30; (1872) 9 Moo PC NS 214; (1872) 17 ER 495
6 Jul 1872
PC
Company
Although a right to participate in the profits of a Trade is a strong test of partnership, and there may be cases where, from such perception alone, it may as a presumption, not of law, but of fact, be enforced, yet, whether that relation does or does not exist, must depend on the real intention and contract of the parties
Link[s] omitted
Imperial Mercantile Credit Association -v- Coleman (1873) LR 6 HL 189
1873
HL
Company, Trusts Casemap

Where a company director puts the benefit of a company contract into a partnership, he is fully accountable even if his partners are entitled to part of the profit and are ignorant of his breach of fiduciary duty.
Peek -v- Gurney; HL 1873
Waterer -v- Waterer [1873] LR 15 Eq 402
1873

Company, Wills and Probate Casemap
1 Citers
Parker -v- McKenna; CA 1874
Russell -v- Wakefield Waterworks Co; 1875
In re Regents Canal Ironworks Co (1875) 3 Ch D 411
1875

James LJ
Company Casemap
1 Citers
Costs incurred by liquidators in realising charged assets are payable ahead of the debenture holder's claims. As the debenture-holder is entitled to the proceeds, it is right that he should pay the cost of realisation.
Ashbury Railway Carriage and Iron Co -v- Riche (1875) LR 7 App Cas 653
1875
HL
Company
1 Citers
A company created under the Act is not created a corporation with inherent common law rights. The memorandum was the company's charter which could not be departed from save so far as permitted by s12. A contract made by the directors upon a matter not provided for in the memorandum of association is ultra vires and is not binding upon the company, and could not be made binding on the company even if assented to by a general meeting of the shareholders. It was, in its inception, void.
Companiesd Act 1862 12
Calcutta Jute Mills Co Ltd -v- Nicholson [1876] 1 TC 83
1876

Company, Income Tax Casemap
1 Citers
(Court of Exchequer) The residence of a company for tax purposes is decided by where the 'central management and control' is.
Syers -v- Syers; HL 1876
In re David Lloyd & Co; 1877
Muir -v- City of Glasgow Bank; HL 1878
Re Forest of Dean Mining Co (1878) LR 10 Ch 450
1878

Jessel MR
Company Casemap
1 Citers
Jessel MR: "Again, directors are called trustees. They are no doubt trustees of assets which have come into their hands, or which are under their control, but they are not trustees of a debt due to the company. The company is the creditor, and, as I said before, they are only the managing partners. In my opinion it is extravagant to call them trustees of a debt when it has not been received. You may of course have an actual trust of a debt, as in the case I put before, where trustees have assigned to them a debt to get in, but that is not the case with directors of a company. A director is the managing partner of the concern, and although a debt is due to the concern I do not think it is right to call him a trustee of that debt which remains unpaid, though his liability in respect of it may in certain cases and in some respects be analogous to the liability of a trustee."
Simm and Others -v- Anglo-American Telegraph Co (1879) 5 QBD 188
1879
CA
Brett LJ, Cotton LJ
Estoppel, Company

A firm which had acted through nominees sought to raise an estoppel as to its status on the company registers. Held: The nominees acquired a "title by estoppel" against the company following the issue by the company of a share certificate to the nominees. But that "title" had been lost by the time the action began and was not available to Burge & Co. No representation was made which they had acted upon. Even if there had been a representation, that firm had not altered their position in any material way.
Smith -v- Anderson (1879) 15 ChD 247
1879
CA
Brett LJ
Company
1 Citers
Investors subscribed for shares in telegraph companies which they vested in trustees to manage the investment on certain terms. A question arose whether this arrangement contravened section 4 of the 1862 Act which prohibited the formation of an association consisting of more than 20 persons "for the purpose of carrying on any business that has for its object the acquisition of gain" unless it was registered in accordance with the Act. Held (inter alia) Brett LJ said that the expression "carrying on" implied a repetition of acts and excluded the case of an association formed for doing one particular act which was never to be repeated.
Companies Act 1862 4
Re Rica Gold Washing Co; 1879
Re Canadian Land Reclaiming and Colonizing Co; CA 1880
Attorney-General -v- Great Eastern Railway Co; HL 1880
Yates -v- Finn; 1880
Redgrave -v- Hurd [1881] 20 ChD 1
1881
CA
Sir George Jessel MR
Contract, Company

The purchaser of a solicitor’s practice had seen accounts which upon examination would have revealed the falsity of the representation as to the level of profit it was said that the practice was achieving. Held: In the absence of proof that he had in fact become aware of the falsity, he was entitled to relief. To claim that a misrepresentation was corrected before the contract was entered into, it is not sufficient to say that he would have discovered the true position if he had acted with all due care. "Nothing can be plainer, I take it, on the authorities in equity than that the effect of false representation is not got rid of on the ground that the person to whom it was made has been guilty of negligence. One of the most familiar instances in modern times is where men issue a prospectus in which they make false statements of the contract made before the formation of a company, and then say that the contracts themselves may be inspected at the offices of the solicitor. It has always been held that those who accepted those false statements as true were not deprived of their remedy merely because they neglected to go and look at the contract. Another instance with which we are familiar is where a vendor makes a false statement as to the contents of a lease, as, for instance, that it contains no covenant preventing the carrying on of the trade which the purchaser is know by the vendor to be desirous of carrying on upon the property. Although the lease itself might be produced at the sale, or might have been open to the inspection of the purchaser long previously to the sale, it has been repeatedly held that the vendor cannot be allowed to say, "You were not entitled to give credit to my statement". It is not sufficient, therefore, to say that the purchaser had the opportunity of investigating the real state of the case, but did not avail himself of that opportunity."
Pawsey -v- Armstrong; ChD 1881
Ex parte Moore (1881) 30 WR 123
1881

Company Casemap
1 Citers
The rule that a company director may not have an interest in a contract with the company applies even if if he is only acting as an agent for another.
Caledonian Railway Company -v- North British Railway Company (1881) 6 AC 114
1881
HL
Lord Selborne
Company Casemap

The House considered the principle of the literal construction of a statute: "The more literal construction ought not to prevail, if … it is opposed to the intentions of the Legislature, as apparent by the statute; and if the words are sufficiently flexible to admit of some other construction by which that intention will be better effectuated."
Re Exchange Banking Co, Flitcroft's Case; CA 1882
Mayor, Constables and Company of the Merchants of the Staple -v- Bank of England (1887) 21 QBD 160
1883

Wills J
Land, Company Casemap
1 Citers
The sealing of a deed prima facie imported not only due execution but also delivery. "The affixing the seal is not enough; there must be delivery of the deed also …. Prima facie, putting the seal imports delivery; yet, if it be intended otherwise, it is not so …."
Hutton -v- West Cork Rly Co (1883) 23 ChD 654
1883
CA
Bowen LJ
Company Casemap
1 Citers
Even though a company's directors may act in good faith for a purpose which is ostensibly within their powers, the court may intervene in exceptional circumstances: "Bona fides cannot be the sole test, otherwise you might have a lunatic conducting the affairs of the company, and paying away its money with both hands in a manner perfectly bona fide yet perfectly irrational."
Shaw -v- The Port Phillip and Colonial Gold Mining Company Ltd [1884] 34 QB 103
1884

Steven J
Company Casemap

A company secretary was to procure execution of certificates of shares in accordance with prescribed formalities. A certificate was issued and presented by the secretary in favour of a purchaser in the usual form with signature of director and secretary and bearing the company's seal. But the signature of the director appended was, in fact, a forgery made by the secretary. The seal had also been affixed without authority of the board. The purchaser in due course lodged the share certificates as security and executed a transfer in favour of the plaintiff. Both purchaser and plaintiff acted throughout in good faith. The company argued that the signature of the director being forged, the whole document was a nullity. Held. The forgery being by its own employee, the company could not reject the transfers.
Steven J said: "It is said in answer that here the secretary carried out his fraud by means of forgery. It appears to me that this fact does not make any material difference. The defendants' counsel said it did make a difference on the ground, so far as I understand his argument, that nothing can give validity to a forged instrument as against anybody. That does not seem to me to be the case, and I think the authorities cited for the plaintiff are applicable. The company appear in this case to have prescribed certain formalities with regard to the use of the seal and the issue of certificates. The certificate is to be signed by a director and the secretary. In the present case it apparently does comply with those formalities; it is apparently so signed, and it is I stated to be in the usual and authorised form. The company made it the duty of the secretary to procure the preparation, execution, and signature of certificates with the prescribed formalities, and thereupon to issue them to the persons entitle to receive them. They thereby gave the secretary the opportunity of doing what he has done in this case. A person can inform himself whether the certificate comes from the secretary because he gets it from the secretary's office, but I do not see how, according to any practicable course of business, he can go behind the certificate and ascertain for himself such matters as whether the signature of the director is genuine. It appears to me, therefore, that the company have authorised the secretary, and made it his official duty, to act in such a way that his acts amount to a warranty by them of the genuineness of the certificate issued by him. For these reasons I think the question put to us should be answered in favour of the plaintiff."
Matthew J commented: "I am of the same opinion, on the ground that the company is responsible for the fraud committed by its agent while acting within the ordinary scope of his employment. Upon the statements contained in the case I cannot doubt that it was within the scope of their secretary's employment to do what he did here. It is stated to have been the duty of the secretary to procure the execution of the certificate with the prescribed formalities, and to issue it to the person entitled thereto. It is obviously indispensable in the ordinary course of business that the secretary should perform these duties, and it never could have been contemplated that the purchaser of shares should himself ascertain that each of the prescribed formalities had, in fact, been complied with. It seems to me, therefore, that the secretary is held out by the company as their agent to warrant the genuineness of the certificate. It was argued by the counsel for the defendants that the fact that the certificate was a forgery prevented their being liable for the act of their agent, but he failed, as it appeared to me, to establish any difference for this purpose between a fraud carried out by means of forgery and any other fraud. For these reasons I am of the opinion that our judgment should be for the plaintiff."
Standing -v- Bowring (1885) 31 Ch 282
1885

Company, Equity Casemap

A gift of shares was made, but challenged. Held: Registration of the transfer was actually completed and so the gift was completely constituted.
Helmore -v- Smith (1886) 35 Ch D 436
1886

Company, Trusts

The relationship between partners is of a fiduciary nature. "If fiduciary relation means anything I cannot conceive a stronger case of fiduciary relation than that which exists between partners"
Bouche -v- Sproule (1887) 12 App Cas 385
1887

Company
1 Citers
Lord Bramwell discussed the capitalisation of undistributed profis within a partnership: "Where there is a partnership, whether an ordinary partnership or an incorporated partnership… There the undivided profits of any period, a year or shorter or longer time, continue to be undivided profits unless something in the articles of partnership or some agreement by all the partners make them capital. They do not become capital by effluxion of time or by their being used in the trading".
Trevor -v- Whitworth (1887) 12 App Cas 409
1887

Company Casemap
1 Citers
It is a fundamental rule of cmpany law that that the Companies Acts by implication prohibit a company from returning capital to shareholders except in one of the ways expressly permitted by the Acts.
Nanney -v- Morgan (1888) 37 Ch D 346
1888

Company
1 Citers
A deed of transfer of shares did not pass the legal interest to the transferee until it was delivered to the secretary of the company. It was held that the transfer did not take effect until it had been left with the secretary and accepted by him. On the first occasion it was rejected because it was not properly stamped. The transfer had to be properly stamped in order to make the transfer effectual as between the company and the transferee. The legal title to the stock remained with the transferors until then. Accordingly, effectual delivery to the company is required
Farrar -v- Farrars Ltd (1888) 40 Ch D 395
1888
CA
Land, Company
1 Citers
The mortgagor of a quarry defaulted, and the mortgagees took possession. They were unable to sell the quarry, but formed a company which bought the quarry at a proper value. The mortgagor sought to set aside the sale. Held: A mortgagee in possession exercises a personal right primarily in his own interests as a mortgagee, The self-dealing rule applies in that a mortgagee cannot exercise the power to sell to himself or to a nominee or to a company of which he is the sole director and shareholder, but he can sell to a company in which he has a significant interest but the onus lies on him to justify the terms of sale. The mortgagees had shown that the sale was made in good faith, and at a proper price; with the consequence that the sale stood.
Nichols -v- Evens (1883) 22 Ch 611
1888

Fry J
Company Casemap
1 Citers
Gourand -v- Edison Gower Bell Telephone Co of Europe Ltd; ChD 1888
Read -v- Joannon; 1890
In Re New Eberhardt Company, Ex parte Menzies; 1890
Aas -v- Benham; CA 1891
Re Alabama, New Orleans, Texas and Pacific Junction Railway Company; CA 1891
Knowles -v- Scott; 1891
In re Standard Manufacturing Co; CA 1891
London & Mashonaland Exploration Co Ltd -v- New Mashonaland Exploration Co Ltd; 1891
Sovereign Life Assurance -v- Dodd [1892] 2 QB 573
1892

Bowen LJ
Company Casemap

"What is the proper construction of that statute? It makes the majority of the creditors or of a class of creditors bind the minority: it exercises a most formidable compulsion upon dissentient, or would-be dissentient, creditors; and it therefore requires to be construed with care, so as not to place in the hands of some of the creditors the means and opportunity of forcing dissentients to do that which it is unreasonable to require them to do, or of making a mere jest of the interests of the minority. " and "The word "class" is vague, and to find out what is meant by it we must look at the scope of the section, which is a section enabling the court to order a meeting of a class of creditors to be called. It seems plain that we must give such a meaning to the term "class" as will prevent the section being so worked as to result in confiscation and injustice, that it must be confined to those persons whose rights are not so dissimilar as to make it impossible for them to consult together with a view to their common interest. "
Joint Stock Companies Arrangement Act 1870
English & Scottish Mercantile Investment Co Ltd -v- Brunton; CA 1892
In Re Sharpe [1892] 1 Ch 154
1892

Company
1 Citers
The misapplication of company money in the form of ultra vires payments of interest to shareholders was treated as a breach of trust by the directors.
In re English, Scottish and Australian Chartered Bank [1893] 3 Ch 385
1893

Vaughan Williams J
Company, Insolvency, International Casemap
1 Citers
Vaughan Williams J said: "One knows that where there is a liquidation of one concern the general principle is - ascertain what is the domicile of the company in liquidation; let the court of the country of domicile act as the principal court to govern the liquidation; and let the other courts act as ancillary, as far as they can, to the principal liquidation. But although that is so, it has always been held that the desire to assist in the main liquidation - the desire to act as ancillary to the court where the main liquidation is going on - will not ever make the court give up the forensic rules which govern the conduct of its own liquidation."(
Hunter -v- Dowling [1893] 3 Ch 212
1893
CA
Company
1 Cites

The articles of partnership between the parties required an annual account. A retiring or deceased partner was to be paid out "at the amount standing to his credit in the last balance sheet which shall have been signed previously to the date of such retirement or death." On the death of a partner on 10 April 1891, no account had been taken for the year ending 31 March 1891. The question was whether his share should be ascertained by reference to the previous year's account (which had been taken and signed) or whether the correct course was to direct that an account be taken for the year to 31 March 1891 and ascertain the share by reference to that account. A literal construction of the words "shall have been signed" would have led to the conclusion that the relevant account was that for the year ending 31 March 1890. Held: The Court rejected that construction. It ought to act on the basis that that which ought to be done must be treated as if it had been done. From 31 March 1891 each partner had an accrued right under clause 15 to have an account taken as at that date; and the personal representatives of a partner who died after that day had a right to be paid out as if that had been done.
The Balkis Consolidated Co Ltd -v- Tomkinson and Others [1893] AC 396
1893
HL
Lord Herschell LC, Lord Macnaghten, Lord Field
Company
1 Cites

Tomkinson, a stockbroker, bought shares was registered by the company and received share certificates, and then sold them. The company found that the vendor to him had previously sold the shares to someone else who had been duly registered. The transfer to Tomkinson was a fraud, and the company refused to register Tomkinson's purchasers. Tomkinson bought other shares in the market to make good his transactions with his purchasers and sued the company for his costs. Pollock B. gave judgment in Tomkinson's favour, as did the Court of Appeal. Held: All the elements necessary to creat an estoppel were present.
Lord Herschell LC described the effect of Bahia:- "The Court held that the giving of the certificate amounted to a statement by the company, intended by them to be acted upon by the purchasers of shares in the market, that the persons certified as the holders were entitled to the shares; and that the purchasers having acted on the statement by the company, they were estopped from denying its truth and liable to pay as damages the value of the shares." and "The learned counsel for the appellants impeached these decisions, as they were entitled to do in your Lordships' House, and contended that they ought to be overruled. After carefully considering the able arguments urged at the Bar, I have no hesitation in expressing my concurrence in the law laid down by the Court of Queen's Bench in Re Bahia and The San Francisco Railway Co.. The reasoning of Blackburn J in pronouncing judgment in that case appears to me to be sound and in accordance with the law, and I think it would be very mischievous to cast any doubt on the authority of that case."
Lord Macnaghten:- "The general principle of law relating to estoppel by representation cannot be questioned. It is, as Lord Cranworth observed in the case of Jorden v. Money, before this House, a principle of universal application, that if a person makes a false representation to another and that other acts upon that false representation the person who has made it shall not afterwards be allowed to set up that what he said was false and to assert the real truth in place of the falsehood which has so misled the other. Then, after referring to some cases on the subject, his Lordship goes on to say: "I think the principle may be carried much further, because I think it is not necessary that the party making the representation should know that it was false, no fraud need have been intended at the time. But if the party has unwittingly misled another you must add that he has misled another under such circumstances that he had reasonable ground for supposing that the person whom he was misleading was to act upon what he was saying." Now there is no doubt, I think, that in this case the company must be taken to have known that the certificate was required by Tomkinson or his firm for the purpose of being acted upon."
In re Ottos Kopje Diamond Mines Ltd [1893] Ch 618
1893
CA
Bowen LJ
Estoppel, Company Casemap

Bowen LJ: (referring to Bahia) "The way in which the Court made the company liable was this: they said that in as much as the certificate had been intended to be acted upon, it became a document the truth of which the company could not deny as against the transferee to whom it was intended to be shewn; and, therefore, it precluded the company, as against the transferee, from denying the truth of what the certificate contained; they could not be in any better position than if the statement were true;"
British and American [1894] AC 399
1894
HL
Company Casemap
1 Citers
Re Lands Allotment Company; CA 1894
Overseers of the Savoy -v- Art Union of London Limited [1894] 2 QB 609
1894
QBD
AL Smith LJ
Company
1 Citers
AL Smith LJ considered the objects of the company: "If the other object be only a means to the one end . . then the Society has a sole and exclusive object and not another object subsidiary thereto".
Davis -v- Davis [1894] 1 ChD 393
1894

Company Casemap

Conversion of partnership property
In re Kingston Cotton Mill (No 2); ChD 1895
Brophy -v- Attorney-General of Manitoba [1895] AC 202
1895
PC
Lord Herschell LC
Company Casemap
1 Citers
Manchester Corporation -v- Furness; 1895
Beaver -v- The Master In Equity of The Supreme Court of Victoria; PC 29-Jan-1895
Re Hampshire Land Company; 1896
Great Northern Railway Co -v- Cole Co-Operative Society; 1896
Salomon -v- A Salomon and Company Ltd; HL 16-Nov-1896
Welton -v- Saffery; 1897
Spokes -v- Grosvenor and West End Railway Terminus Hotel Co Ltd [1897] 2 QB 124
1897
CA
A L Smith LJ, Chitty LJ
Company, Litigation Practice

The court discussed the joinder of the company in a derivative action. A L Smith LJ said: "That in the circumstances of this case the company are necessary parties to the suit I do not doubt, for without the company being made a party to the action it could not proceed" because "the company must be party to the suit in order to be bound by the result of the action and to receive the money received in the action." Also, "‘what is recovered cannot be paid to the plaintiff representing the minority, but must go into the coffers of the company."
Chitty LJ said: "To such an action as this the company are necessary defendants. The reason is obvious: the wrong alleged is done to the company, and the company must be party to the suit in order to be bound by the result of the action and to receive the money recovered in the action. If the company were not bound they could bring a fresh action for the same cause if the action failed, and there were subsequently a change in the board of directors and in the voting power. Obviously in such action as this is, no specific relief is asked against the company; and obviously, too, what is recovered cannot be paid to the plaintiff representing the minority, but must go into the coffers of the company. It was argued for the appellants that the company were made a party for the purpose of discovery only, and authorities were cited to shew that when no relief is asked against a party he cannot or ought not to be compelled to make discovery. But this argument and these authorities have no bearing on the present case, where, as already shewn, the action cannot proceed in the absence of the defendant company, and the defendant company are interested in and will be bound by the results".
Companies Act 2006
Lagunas Nitrate Co -v- Lagunas Syndicate [1899] 2 Ch 392
1899

Lindley MR
Company

The standard of behaviour expected of a company director was described: "As directors, I am not aware that there is any difference between their legal and their equitable duties. If directors act within their powers, if they act with such care as is reasonably to be expected from them, having regard to their knowledge and experience, and if they act honestly for the benefit of the company they represent, they discharge both their equitable as well as their legal duty to the company. In this case they clearly acted within their powers: they did nothing ultra vires: fraud is not imputed. The inquiry, therefore, is reduced to want of care and bona fides with a view to the interests of the nitrate company. The amount of care to be taken is difficult to define; but it is plain that directors are not liable for all the mistakes they may make, although if they had taken more care they might have avoided them: see Overend, Gurney & Co. v. Gibb. Their negligence must be not the omission to take all possible care; it must be much more blameable than that: it must be in a business sense culpable or gross."