Links: Home | swarblaw - law discussions

swarb.co.uk - law index


These cases are from the lawindexpro database. They are now being transferred to the swarb.co.uk website in a better form. As a case is published there, an entry here will link to it. The swarb.co.uk site includes many later cases.  















Company - From: 1960 To: 1969

This page lists 39 cases, and was prepared on 14 July 2015.

 
Lee -v- Lee's Air Farming Limited [1960] 3 All ER 420
1960
PC

Commonwealth, Company, Employment
Mr Lee had formed a company, Lee's Air Farming Limited and held nearly all its shares. He was the managing director, but by profession a pilot. The company was formed to conduct an aerial top-dressing business. He appointed himself the chief pilot for the company. In the Court of Appeal of New Zealand, North J said: "These powers were moreover delegated to him for life and there remained with the company no power of management whatsoever. One of his first acts was to appoint himself the only pilot of the company, for, although article 33 foreshadowed this appointment, yet a contract could only spring into existence after the company had been incorporated. Therefore, he became in effect both employer and worker. True, the contract of employment was between himself and the company: see Booth v Helliwell, but on him lay the duty both of giving orders and obeying them. In our view, the two offices are clearly incompatible. There could exist no power of control and therefore the relationship of master-servant was not created." Held: Appeal allowed. "one person may function in dual capacities. " and "Ex facie there was a contract of service. . . . the real issue is whether the position of the deceased as sole governing director made it impossible for him to be the servant of the company in the capacity of chief pilot of the company. . . there was no such impossibility. There appears to be no greater difficulty in holding that a man acting in one capacity can give orders to himself in another capacity than there is in holding that a man acting in one capacity can make a contract with himself in another capacity. The company and the deceased were separate legal entities. The company had the right to decide what contracts for aerial top-dressing it would enter into. The deceased was the agent of the company in making the necessary decisions."
1 Citers



 
 Barclays Bank Limited -v- Inland Revenue Commissioners; HL 1960 - [1961] AC 509; (1960) 2 All ER 817
 
Unit Construction Co Ltd -v- Bullock [1960] AC 455
1960
HL

Company, Income Tax
The UK parent company owned subsidiaries incorporated in East Africa and carried on trading activities there. The managing director of the parent company concluded that 'the situation of the African subsidiaries was becoming so serious that it was unwise to allow them to be managed in Africa any longer, and that their management must be taken over by the directors of [the parent company] in London.' The board of directors of the parent company 'decided that . . they were forced to take over management and control', and the representative of the parent company in East Africa took over the functions of the local boards, which still existed but stood aside, and controlled the subsidiaries in accordance with the requirements of the parent. Much of that may have been irregular, or even unconstitutional, but it was what happened. Held: The African subsidiaries had become resident in the United Kingdom. A company can come to be resident in a territory even if it does not hold directors' meetings there.
1 Cites

1 Citers



 
 Re Bugle Press Ltd; ChD 1961 - [1961] Ch 270
 
Commercial Banking Co of Sydney Ltd -v- Mann [1961] AC 1; [1960] 3 All ER 482
1961
PC
Viscount Simonds, Lord Reid, Lord Radcliffe, Lord Tucker and Lord Morris of Borth-y-Gest
Commonwealth, Company, Banking, Torts - Other
The respondent Mann practiced as a solicitor in partnership with Richardson. They kept a "trust account" in the partnership name with the Australian and New Zealand Bank in Sydney ("ANZ"). Under the partnership agreement, all assets belonged to Mann, but cheques might be drawn on the partnership bank account by either. Mann gave the necessary authority to ANZ. Richardson used that authority to draw cheques, inserting on each after the printed word "Pay", the words "Bank cheque favour H. Ward" or "Bank cheque H. Ward;". He also filed application forms for bank cheques in favour of H. Ward to a like amount, purporting to sign them on behalf of the firm. He took the documents to ANZ, which in each case debited the firm's account and issued a bank draft of an equal amount in the form "Pay H. Ward or bearer." He took the cheques to the appellant bank, and cashed them over the counter. The bank paid the cheques. He was fraudulent throughout; Ward was not a client of the partnership, nor had any client authorised the payment to him of any money held in the trust account. Mann sued the appellant bank for conversion of the bank cheques, or alternatively to recover the sums received by it from ANZ bank as money had and received to his use. He succeeded before the trial judge, whose decision was affirmed by the Court of Appeal of New South Wales. Held: The bank's appeal succeeded. Mann never obtained any title to the cheques, and he could not obtain title by ratifying the conduct of Richardson in obtaining the cheques from ANZ bank, without at the same time ratifying the dealings in the cheques by Ward and the appellant bank. Mann's claim for damages for conversion failed, and that his alternative claim for money had and received also failed. Where a partner in a firm wrongfully draws a cheque on the partnership account, the proceeds of the cheque are legally his.
Viscount Simonds said: "It is important to distinguish between what was Richardson's authority in relation on the one hand to the A.N.Z. bank and on the other to Mann. No question arises in these proceedings between Mann and the A.N.Z. bank. It is clear that Mann could not as between himself and the bank question Richardson's authority to draw cheques on the trust account. The position as between Mann and Richardson was different. Richardson had no authority, express or implied, from Mann either to draw cheques on the trust account or to obtain bank cheques in exchange for them except for the proper purposes of the partnership. If he exceeded those purposes, his act was unauthorised and open to challenge by Mann. It is in these circumstances that the question must be asked whether, as the judge held, the bank cheques were throughout the property of Mann. It is irrelevant to this question what was the relation between Richardson and Ward and whether the latter gave any consideration for the bank cheques that he received and at what stage Mann learned of the fraud that had been practised upon him. The proposition upon which the respondent founds his claim is simple enough: Richardson was his partner and in that capacity was able to draw upon the trust account and so to obtain from the bank its promissory notes: therefore the notes were the property of the partnership and belonged to Mann, and Richardson could not give a better title to a third party than he himself had."
1 Cites

1 Citers


 
Re Bugle Press Ltd [1961] Ch 270
2 Jan 1961
CA
Lord Evershed MR, Lord Justice Harman
Company
Shareholders with over 90% of the issued shares sought to acquire the remaining shares, and create another company to do so. That company offered to purchase the shares at a valuation. The majority shareholders accepted but the minority shareholder refused. The new company gave notice to exercise the statutory power of compulsory acquisition under the section. The minority shareholder said that the transferee was not entitled to acquire his shares despite the approval of 9/10ths of the shareholder, and said the offer undervalued his shares. The majority did not file any evidence verifying their valuation. The court at first instance granted the declaration, saying the connection between the acquiring company and the majority shareholders was an exception. Held: Upholding the declaration, the constitution of the acquiring company and its connection with the majority shareholders rendered this a special case where the normal rule as to the burden of proof did not apply. ""But if the minority shareholder shows, as he shows here, that the offeror and the ninety per cent of the transferor company's shareholders are the same, then as it seems to me he has prima facie shown that the court ought to order otherwise, since if it should not so do the result would bethat the section has been used not for the purpose of any scheme or contract properly so called or contemplated by the section, but for the quite different purpose of enabling majority shareholders to expropriate or evict the minority" Lord Justice Harman:- "The minority shareholders advisers waived that objection also, and he having applied to the court under the section had, like any other applicant, to prove his case, that is to say to set up a case which the respondents had to answer. He did that quite simply by showing that the transferee company was nothing but a little hut built round his two co-shareholders, and that the so-called "scheme" was made by themselves as directors of that company with themselves as shareholders and the whole thing, therefore, is seen to be a hollow sham. It is then for the transferee company to show that nevertheless there is some good reason why the scheme should be allowed to go on. The transferee company, whether because the two members did not wish to go into the witness-box and be cross-examined or for some other reason, did not file any evidence at all; they merely purported to rely on a copy of a valuation said to have been made on their behalf by a firm of chartered accountants. That valuation was not sworn to, nobody has been able to cross-examine the authors of it and there was in my judgment no case in answer. The minority shareholder has nothing to knock down; he has only to shout and the walls of Jericho fall flat. I am surprised that it was thought that so elementary a device would receive the court's approval."
Companies Act 1948 209
1 Cites

1 Citers


 
Musselwhite -v- CH Musselwhite & Son Ltd [1962] Ch 964
1962


Contract, Company
Sale of shares - duty of vendor between exchange and completion - interim receipts.
1 Citers


 
in Re William Hockley Ltd [1962] 1 WLR 555
1962
ChD
Pennycuick J
Insolvency, Company
Pennycuick J said: "The expression ‘contingent creditor’ is not defined in the Companies Act 1948, but it must, I think, denote a person towards whom under an existing obligation, the company may or will become subject to a present liability upon the happening of a future event or at some future date . ."
Companies Act 1948 224(1)

 
Independent Automatic Sales Ltd -v- Knowles and Foster [1962] 1 WLR 974; [1962] 3 All ER 27
1962
ChD
Buckley J
Company, Insolvency
The company in liquidation had sold machines on hire-purchase. It sued the finance company to recover hire-purchase agreements and other securities which it had charged to secure the repayment of advances. When the finance company relied upon the charge, the plaintiff replied that it was void because it should have been registered as a charge over book debts. Held: If the property subject to a charge is not registered and the property remains after all the costs of the winding up and debts payable in the liquidation have been paid the property will continue to be encumbered even though the charge was not registered at Companies House. A book debt is one which could be properly entered in the books of the company whether in fact entered or not.
1 Citers



 
 Parke -v- Daily News Ltd; 1962 - [1962] Ch 927

 
 Jones -v- Lipman and Another; ChD 1962 - [1962] 1 WLR 832; [1962] 1 All ER 442
 
Boulting -v- Association of Cinematograph, Television and Allied Technicians [1963] 2 QB 606
1963
CA
Upjohn LJ
Legal Professions, Company
There must be a real conflict and not a theoretical conflict, before a solicitor can be restrained from acting in a matter against a former client. In order to give fully informed consent, the person entitled to the benefit of the rule must: "fully understand . . not only what he is doing but also what his legal rights are, and that he is in part surrendering them." As to company directors, a company is entitled "to the undivided loyalty of its directors." The principle recognises the primacy of the interests of the company which he is trusted not to betray.
1 Citers


 
In re Overseas Aviation Engineering(GB) Ltd [1963] I Ch 24
1963
CA
Lord Denning MR, Harman LJ
Company
A charging order on land under section 35(1) of the 1956 Act obtained to enforce a judgment debt was a form of "execution" for the purposes of section 325 CA 1948. Lord Denning MR: "The word "execution" is not defined in the Act. It is, of course, a word familiar to lawyers. "Execution" means, quite simply, the process for enforcing or giving effect to the judgment of the court: and it is "completed" when the judgment creditor gets the money or other thing awarded to him by the judgment. That this is the meaning is seen by reference to that valuable old book Rastill Termes de la Ley, where it is stated: "Execution is, where Judgment is given in any Action, that the plaintiff shall recover the land, debt, or damages, as the case is; and when any Writ is awarded to put him in Possession, or to do any other thing whereby the plaintiff should the better be satisfied his debt or damages, that is called a writ of execution; and when he heath the possession of the land, or is paid the debt or damages, or heath the body of the defendant awarded to prison, then he heath execution." And the same meaning is to be found in Blackman v. Fysh,[1892] 3 Ch 209,217 (C.A.) when Kekewich J. said that execution means the "process of law for the enforcement of a judgment creditor's right and in order to give effect to that right." In cases when execution was had by means of a common law writ, such as fieri facias or elegit, it was legal execution: when it was had by means of an equitable remedy, such as the appointment of a receiver, then it was equitable execution. But in either case it was "execution" because it was the process for enforcing or giving effect to the judgment of the court."
Harman LJ: "Now what is execution but the enforcement of a judgment or order? In my judgment, the new remedy given by section 35 is merely an alternative method of execution against the debtor's land, replacing the old writ".
Administration of Justice Act 1956 35(1) - Companies Act 1948 325
1 Citers


 
Savoy Corp Ltd -v- Development Underwriting Ltd (1963) NSWR 138
1963

Jacob L
Company, Commonwealth
(Australia) The court discussed the extent of the director's powers to arrange the company to prevent a take over: "It would seem to me to be unreal in the light of the structure of modern companies and of modern business life to take the view that directors should in no way concern themselves with the infiltration of the company by persons or groups which they bona fide consider not to be seeking the best interests of the company. My own view is that the directors ought to be allowed to consider who is seeking control and why. If they believe that there will be substantial damage their powers to defeat those seeking a majority will not necessarily be categorised as improper.”
1 Citers


 
NW Robbie & Co Ltd -v- Witney Warehouse [1963] 1 WLR 1324
1963
CA
Russell LJ
Company
A floating charge effects an equitable assignment of the charged asset to the security holder.
1 Citers


 
Thorby -v- Goldberg (1964) 112 CLR 597
1964


Company, Commonwealth
(High Court of Australia) If, when a contract is negotiated on behalf of a company, the directors bona fide think it in the interests of the company as a whole that the transaction should be entered into and carried into effect they may bind themselves by the contract to do whatever is necessary to effectuate it.
1 Citers



 
 Meekins -v- Henson; 1964 - [1964] 1 QB 472

 
 Freeman & Lockyer -v- Buckhurst Park Properties; CA 1964 - [1964] 2 QB 480
 
Charles Forte Investments Ltd -v- Amanda [1964] 1 Ch 240; [1963] 2 All ER 940
1964
CA

Company
A minority shareholder complained of the board's refused to register transfers of his shares to a third party. He threatened to present a winding up petition unless the board registered the transfers. Held: He would be restrained from presenting such a petition. Winding up is properly a remedy of last resort. He had other and more suitable remedies available to him, namely an action for rectification of the register or proceeding by way of motion under section 116, and his threat to employ the machinery of winding up was an attempt to bring pressure on the board to reverse its decision and was an abuse of the process of the court. I would cause unnecessary damage to the company.
In order for the inherent jurisdiction to be invoked successfully it must be "impossible for the party concerned to succeed on his claim" without it.
Companies Act 1948 116
1 Citers



 
 Harrison-Broadley -v- Smith; CA 1964 - [1964] 1 WLR 456

 
 Ridge Securities Ltd -v- Inland Revenue Commissions; ChD 1964 - [1964] 1 WLR 479
 
Heyting -v- Dupont [1964] 1 WLR 843
1964
CA
Russell LJ
Company
The plaintiff owned shares in a company registered in Jersey and created to make the most of an invention. The articles contained a deadlock provision. Held: This was “essentially a dispute between two discordant partners” There was a general exception to the rule in Foss v Harbottle where the interests of justice so required, and service out of the jurisdiction was allowed: “I dare say that the rule in Foss v. Harbottle is a conception as unfamiliar in the Channel Islands as is the Clameur de Haro in the jurisdiction of England and Wales. But clearly this is a matter of procedure to be decided according to the law of the forum.”
1 Cites

1 Citers



 
 Wenlock -v- Moloney; CA 1965 - [1965] 1 WLR 1238
 
Noble -v- Noble [1965] SLT 415
1965
OHCS
Lord Migdale, Lord Strachan, Lord Clyde
Scotland, Company
A father took his son into a farming partnership. The agreement recited that they agreed that "the heritable property should be taken as of the value of eight thousand pounds, but which is burdened with a heritable security for three thousand five hundred pounds". Proper books of account were to be kept. Until 1963 the books of account were prepared on the basis of those values. In 1963 the father sought a declaration that he was entitled to have the capital value of the assets of the partnership entered in the balance sheet at a real and not an arbitrary or notional value. Held: The issue is one of construction: what did the partners intend by the agreement which they made. Lord Strachan, sitting in the Outer House of the Court of Session, granted the declaration. As to Cruikshank v Sutherland: "The fact that Cruikshank was dealing with the share of a deceased partner is not, in my opinion, a material ground for distinguishing it from the present case. Similar issues are involved in this case, because under clause seventh of the contract a retiring partner or the representatives of a deceased partner are to be paid the sum at his credit as shown in the last preceding balance sheet. The same issues are therefore raised, but ab ante. It was argued for the defender, however, that there is vital distinction between Cruikshank and the present case in respect that the agreement that the heritable property is to be taken as of the value of £8,000 laid down a definite figure which was to be adopted in preparing the accounts and that it therefore cannot be said that the contract is silent as to the principle to be adopted in entering the heritable property. That point is the crux of the case, and with some hesitation, I have come to the opinion that the narrative references in the contract and the disposition cannot reasonably be read as meaning that the figure of £8,000 was to be entered in every balance sheet. It was a figure which was agreed for the purpose of fixing the capital of the company but on a construction of the whole deeds I find insufficient warrant for holding that it was intended to be a permanent valuation to be entered in every balance sheet. If that were so, a retiring or deceased partner would have no share whatever in any increase in the market value of the property, and if such an apparently unfair result had been intended, I think it would have been provided for in the eight clauses in which the terms and conditions of the partnership are reduced to writing, and would not have been left to be inferred from the narrative clauses. In my opinion, therefore, the contract is silent as to the principle to be adopted in framing the balance sheet, and Cruikshank is not distinguishable on that ground."
Lord Clyde: "In my opinion the provision requiring the keeping of proper books annually balanced and regularly audited requires the inclusion in the balance sheet of the assets of the partnership at their true value at the end of the year in question. The language of cl.6 of the contract of co-partnery will not therefore be complied with if any of the assets, one of which is the farm itself, is entered at a mere nominal value which was fixed by agreement between the parties when the contract was made. I can find nothing in art. 6 of the contract to support the view that the value of the farm itself - the main asset - was to be frozen year by year at a constant figure throughout the partnership . . . It was contended by the defender that in solicitors' partnership agreements it is quite common to provide that the heritable property in which the business is carried on should be entered at a constant figure in the balance sheets of the partnership throughout its term. It is of course quite legitimate for parties to make such a provision, but clear language to that effect is essential. There is no such provision in the present case."
Lord Migdale: "As I understood their arguments counsel on both sides are agreed that it is always open to partners to provide that an asset acquired by the partnership should continue to appear in the partnership books at its original value. The question raised here is not whether it can be so agreed but whether in this case it was so agreed."
1 Cites

1 Citers



 
 Broadway Approvals Ltd -v- Odhams Press Ltd (No 2); CA 1965 - [1965] 1 WLR 805
 
Willis -v- Association of Universities of the British Commonwealth [1965] 1 QB 140; [1965] 2 All ER 393
1965
CA
Denning MR, Pearson, Salmon LJJ
Landlord and Tenant, Company
The landlord resisted renewal of the business tenancy saying that he intended to occupy the premises himself. The Court was asked whether the landlord could show the necessary intention under section 30(1)(g) where it intended to occupy the premises for the purposes of its business, but had passed a resolution to enter liquidation for the purposes of reconstruction and to transfer its assets to a successor company in order to convert from a limited company into a chartered company.
Lord Denning MR said: "The answer to [the point that the landlord did not intend to occupy the premises itself] is, I think, that the landlords did in fact intend to occupy the premises themselves even if only for the short time that should ensue before the transfer. Section 30(1)(g) of the Act of 1954 does not say for how long the landlord must intend to occupy himself, and the courts must fill the gap. It seems to me that in some cases even a short time may suffice. Take the case where the landlord intends to occupy the premises and to carry on business himself there for six months, and then transfer the business to his son as a family arrangement. I should have thought that the father would have sufficient intention to satisfy section 30(1)(g). But suppose the intention was after six months to transfer to a purchaser for cash, I should not expect that intention to suffice. Just as a purchaser within the previous five years cannot defeat the tenant (see section 30(2)), so also a purchaser shortly afterwards should not be able to defeat him. The matters that influence me are these. It is open to the landlord to complete the transfer before the day of hearing, in which case it is the successor's intention which counts - see section 30(1)(g) - save only that if that successor falls foul of section 30 (2) his intention does not count. Hence I would say that if the landlord intends to occupy the premises and carry on business himself there for a time, and then to transfer to a successor, his intention is sufficient to satisfy section 30(1)(g), unless the intended transfer is one which, if it had been made before the hearing, would have fallen within section 30(2) so as to render section 30(1)(g) unavailable.
Applying those principles to this case it seems to me that the intent of the landlords is sufficient to satisfy section 30(1)(g). They intend to occupy the premises and to carry on their activities therein (by providing the detailed administration for the Universities Central Council on Admissions) and then to transfer their activities to their successors, the chartered company, without any payment in money or anything in the nature of sale or purchase.
The landlords have established, therefore, the statutory ground of opposition. The tenants are not entitled to a new lease."
Pearson LJ said that the landlord and its successor company were in practice and substance the same: an intention to carry out a sale after taking possession would mean that the landlord had not shown the necessary intention: "This case falls within the literal meaning of section 30(1)(g) as the landlords do intend to occupy the premises for the purposes of a business to be carried on by them therein, though only for a short time until transfer of the occupation and the business to the chartered corporation. The transfer will not be by way of sale. and there will be only a formal change of identity. In form the landlords are a limited company which is being wound up, and a new chartered corporation has been created. In substance, however, there is continuity. The phrase alter ego undoubtedly lacks precision for most purposes, but for the present purpose it is a fair description of the landlords in their new guise of the chartered corporation as successors of the landlords in their old guise of the limited company.
There must, however, be some qualification of the literal meaning of section 30(1)(g) of the Act of 1954. A landlord should not be allowed to succeed under section 30(1)(g) in a case where his intention is only to start a business at the premises and carry it on for a few weeks and then sell his interest in the premises and the business. If the sale took place before the hearing the purchaser would be precluded by section 30 (2) from relying on section 30 (1) (g). It should not be possible to evade section 30 (2) by postponing the intended sale until after the hearing. There is, therefore, an implied limitation on the operation of section 30 (1) (g); it is not applicable if the landlord's intention is to occupy for only a short time and then make a sale. The implied limitation should not be any greater than is necessary to secure consistency between section 30 (1) (g) and section 30 (2). Probably section 30 (1) (g) can be allowed to apply according to its terms without implied limitation in any case where no sale is intended. Certainly it should be allowed to apply according to its terms in a case such as the present where there is no intended transaction even resembling a sale and there is to be complete continuity of operation, and the only transfer is to be a formal transfer to an alter ego of the transferor."
Salmon LJ said that: "The argument runs that, at best, the period during which the landlords will carry on business there before the transfer is so short that the landlords' real purpose in occupying the premises is to effect the transfer. It is pointed out that in the ordinary case a landlord could not defeat the tenant's right to a new lease if he intended to occupy the premises and carry on business there for only a few days or weeks before selling them. In such circumstances his real purpose would be to sell the premises, not to carry on business there. No doubt that is so.
If, however, a landlord not being a company, intended to occupy the premises and carry on business there as long as he lived or was physically capable of doing so, his rights under the Act of 1954 could not, in my judgment, be defeated by showing that his expectation of life or of retaining his strength happened to be very short. The tenant could not successfully argue that the landlord's real intention was merely to transfer the premises to his heirs. If the landlord died before the termination of the tenancy, or indeed at any time before the hearing, his heirs would stand in his shoes and succeed to his rights. They could not be defeated because they had inherited only recently; Landlord and Tenant Act, 1954, ss. 30 (2) and 41 (2). So, too, if a landlord transferred otherwise than for money or money's worth at any time, his transferee would succeed to his rights against the tenant; H. L. Bolton Engineering Co. Ltd. v. T. J. Graham & Co. Ltd.
Here the circumstances are somewhat analogous. The landlord association will be dissolved, for all practical purposes, as soon as the transfer to the new chartered association is complete. It intends to carry on its activities, inter alia, in the three rooms on the top floor of No. 29, Tavistock Square, virtually for the rest of its life, short as that may be. Moreover (and this is of crucial importance), it is quite plain that the transfer to the new chartered association will be by way of gift, and not for any financial consideration. In these circumstances there seems to me to be no reason on principle or authority why the probable brevity of the landlords' occupation of the three top rooms should confer any benefit upon the tenants, and in my view it does not do so. If the transfer to the chartered association had been completed before the county court hearing, the tenants would clearly have had no right to a new lease. I am glad to think that the law does not make the rights of the parties depend upon the fortuitous circumstance as to whether the transfer is executed sooner rather than later."
Landlord and Tenant Act 1954 30(1)(g)
1 Cites

1 Citers


 
Hogg -v- Cramphorn Limited [1966] 3 All ER 420; [1967] Ch 254
1966
ChD
Buckley J
Company
An honest belief that directors should seek to maintain their office for the good of the company did not prevent the motive for issuing additional shares to prevent a take-over from being an improper motive.
Buckley J quoted Piercy and said: "With those observations I respectfully agree. Unless a majority in a company is acting oppressively towards the minority, this court should not and will not itself interfere with the exercise by the majority of its constitutional rights or embark upon an inquiry into the respective merits of the views held or policies favoured by the majority and the minority. Nor will this court permit directors to exercise powers, which have been delegated to them by the company in circumstances which put the directors in a fiduciary position when exercising those powers, in such a way as to interfere with the exercise by the majority of its constitutional rights; and in a case of this kind also, in my judgment, the court should not investigate the rival merits of the views or policies of the parties . . It is not, in my judgment, open to the directors in such a case to say, ‘We genuinely believe that what we seek to prevent the majority from doing will harm the company and therefore our act in arming ourselves or our party with sufficient shares to outvote the majority is a conscientious exercise of our powers under the articles, which should not be interfered with."
1 Cites

1 Citers


 
Noble -v- Noble Unreported, 26 January 1996
26 Jan 1966
IHCS

Company, Scotland

1 Cites

1 Citers


 
Pathirana -v- Pathirana [1967] 1 AC 233; [1966] 3 WLR 666; [1966] UKPC 14
28 Jun 1966
PC
Guest, Pearce, Upjohn, Pearson LL, Sir Frederic Sellers
Commonwealth, Company, Trusts
A partnership between the parties had held a contract for the exclusive supply of a foreign company's goods in Ceylon. One of the partners cancelled the partnership's contract and took a new contract in his name alone. This contract was said to be personal to that partner. Held: The Privy Council advised that this new contract was to be treated as partnership property, since it arose out of the substantial goodwill which the partnership had generated.
After termination, one partner carries on the partnership business using the capital of the other, that partner is liable to account to the partnership.
[ Bailii ]

 
 in Re Resinoid and Mica Products Ltd; CA 1967 - [1982] 3 All ER 677
 
In Re Plymouth Breweries Ltd (1967) 111 SJ 715
1967

Pennycuick J
Company
In 1893 a scheme of reconstruction which adjusted the rights of the preference and the ordinary shareholders was promoted, and in the following year was approved by the court. But it appeared that the scheme had never been approved by a quorate meeting of either class. The scheme was implemented. Held: The contention that the class resolutions were a nullity owing to the absence of a quorum, would have been correct, apart from the circumstances of ratification and estoppel.
1 Citers


 
R W Pathirana -v- A Pathirana [1967] 1 AC 233
1967
PC

Company, Equity
Section 29 requires a partner to account to the partnership for any private benefit which he derives at the expense of the partnership, and this duty subsists after the dissolution of the partnership until the winding up is completed. An inalienable asset had been acquired by one partner in his own name but in account of the firm.
Partnership Act 18980 29
1 Citers



 
 Selangor United Rubber Estates Ltd -v- Cradock (No 3); ChD 1968 - [1968] 1 WLR 1555; [1968] 2 All ER 1073

 
 Re Saltdean Estates; 1968 - [1968] 1 WLR 583
 
Harlowe's Nominees Pty Ltd -v- Woodside (Lakes Entrance) Oil Company No Liability (1968) 121 CLR 483
1968


Company

1 Citers


 
Hely-Hutchinson -v- Brayhead Ltd [1968] 1 QB 549
1968


Company
Directors are required to disclose their interests in contracts with the company: "'It is not contended that [the] section in itself affects the contract. The section merely creates a statutory duty of disclosure and imposes a fine for non-compliance. But it has to be read in conjunction with article [85]. The first sentence of that article is obscure. If a director makes or is interested in a contract with the company, but fails duly to declare his interest, what happens to the contract? Is it void, or is it voidable at the option of the company, or is it still binding on both parties, or what? The article supplies no answer to these questions. I think the answer must be supplied by the general law, and the answer is that the contract is voidable at the option of the company, so that the company has a choice whether to affirm or avoid the contract, but the contract must be either totally affirmed or totally avoided and the right of avoidance will be lost if such time elapses or such events occur as to prevent rescission of the contract . . ."
Companies Act 1948 317
1 Citers



 
 Barclays Bank Ltd -v- Quistclose Investments Ltd; etc; HL 31-Oct-1968 - [1970] AC 567; [1968] UKHL 4

 
 Capital Finance -v- Stokes; 1969 - [1969] 1 Ch 261
 
In Re Duomatic Ltd [1969] 2 Ch 365; [1969] 2 WLR 114; [1969] 1 All ER 161
1969
ChD
Buckley J
Company
Payments were made by a company by way of remuneration to directors without complying with the company’s articles of association in that no resolution authorising the directors to receive remuneration had ever been passed in a general meeting of the company or at all. Held: Where it could be shown that all the shareholders with the right to attend and vote at a general meeting had assented to some matter which a general meeting of the company could carry into effect, such assent was as binding as a resolution in general meeting and that, since in that case the ordinary shareholders, who were the only shareholders with the right to attend and vote at a general meeting had approved the accounts recording the respective payments to the directors, those payments should not be disturbed. A sole beneficial owner of a company's share capital could override the decisions of the director. He could also do so informally and without passing a special resolution. However the act had to be intra vires the company. Buckley J: “Mr Wright, for the liquidator, has contended that where there has been no formal meeting of the company and reliance is placed upon the informal consent of the shareholders the cases indicate that it is necessary to establish that all shareholders have consented . . it seems to me that if it had occurred to Mr Elvins and Mr East, at the time when they were considering the accounts, to take the formal step of constituting themselves a general meeting of the company and passing a formal resolution approving the payment of directors’ salaries, that it would have made the position of the directors who received the remuneration, Mr Elvins and Mr Hanley, secure, and nobody could thereafter have disputed their right to retain their remuneration. The fact that they did not take that formal step but that they nevertheless did apply their minds to the question of whether the drawings .. should be approved ... seems to lead to the conclusion that I ought to regard their consent as being tantamount to a resolution of a general meeting of the company. In other words, I proceed upon the basis that where it can be shown that all shareholders who have a right to attend and vote at a general meeting of the company assent to some matter which a general meeting of the company could carry into effect, that assent is as binding as a resolution in general meeting would be."
1 Citers


 
Copyright 2014 David Swarbrick, 10 Halifax Road, Brighouse, West Yorkshire HD6 2AG.