The rights of mortgagees of shares, registered in their names, might be qualified by contractual provisions.
Swinfen Eady MR explained: ‘In the ordinary way, where shares are transferred to and registered in the name of a mortgagee it follows, from his position as owner at law of the shares, that the ownership carries with it the voting right, that this is vested in the owner of the shares; and it would require a contract to exclude that right. Sometimes, where shares form a security, there is a contemporaneous collateral agreement as to the mode in which, and the extent to which, voting rights in respect of the shares shall be exercised. But in the absence of any such agreement the voting rights would be with the legal owners of the shares, and it would require a contract to control the exercise of those rights’
Judges:
Swinfen Eady MR
Citations:
[1918] 2 Ch 324
Jurisdiction:
England and Wales
Company
Updated: 27 November 2022; Ref: scu.662432