WRITS OF SUMMONS. In the High Court of Justice. Chancery Division. writ. Mr. Justice [The Victoria, by the grace of God, &c. Co, Limtd, of ; B., of ; C., of ; and Form 282. To [The Common form D., of -]. We command you that within eight days after the service of this writ on you inclusive of the day of such service you do cause an appearance to be entered for you in an action at the suit of A., and take notice that in default of your so doing the plt may proceed therein and judgmt may be given in your absence. Witness, Roundell, Earl of Selborne, Lord High Chancellor of Great Britain, the in the year of our Lord one thousand eight hundred and day of N.B.-This writ is to be served within twelve calendar months from the date thereof, or if renewed within six calendar months from the date of the last renewal including the day of such date and not afterwards. The deft [or defts] may appear hereto by entering an appearance [or appearances] either personally or by solicitor at the Central Office, Royal Courts of Justice, London. Indorsemts to be made on the writ before issue thereof. sd plt, who resides at ; or this writ was issued by of· or this was solicitor for the G. H., of solicitor for the [mention the city, town, or parish, and also the name of the street and number of the house of the plt's residence, if any]. Indorsemt to be made on the writ after service thereof: This writ was served by me at on the deft on (Signed) See Rules of Sup. Ct. of 1883, Appendix A. Rule 228 provides that— "Whenever a statement of claim is delivered the plaintiff may therein alter, modify or extend his claim without any amendment of the indorsement of the writ." The following are some of the indorsements commonly used: 1. A declon that he was induced to take 100 shares in the deft co by Form 283. misrepresentation and non-disclosure of material facts. Rescission of 2. Rescission of the contract to take such shares and rectification of contract to take shares. the register of members of the deft co by removing his name. 3. Repaymt of the amounts pd by him on the sd shares with interest. 4. An injunction to restrain the deft co from making or attempting to enforce by action or otherwise any call in respect of the sd shares. The above Form can be used where there is no case of fraudulent misrepresentation, and the plaintiff claims relief merely on the ground of non-disclosure or innocent misrepresentation. See supra, p. 230. Sometimes in such circumstances there may be a case against the directors under s. 38 of the Companies Act, 1867. See supra, p. 242, and, if so, the directors can be made defendants along with the company, and the following claim can be added: and 5. Or in the alternative as against the defts, for a declon that the prospectus of the deft co upon the faith of which the plt took such shares was fraudulent on the pt of the sd defts within the meaning of Sect. 38 of the Companies Act, 1867, and for damages for the loss occasioned to the plt by the fraud of the defts in publishing and issuing such prospectus, and for indemnity against all liability in respect of such shares. The following is another form sometimes used instead of Clauses 1 and 2 Form 283a. above: 1. To have the contract, by virtue of which he becomes entled to shares in the capital of the deft co, set aside on the ground that he was induced to enter into that contract by misrepresentation and non-disclosure of material facts, and to have the register of members of the co rectified by striking out his name as the holder of such shares. [Plt, A.; defts, the co, and A., B., and C., directors.] The plt claims 1. A declon that he was induced to take 200 shares in the deft co by the fraudulent misrepresentations of the defts. Form 284. Rescission and damages : fraud. Form 284. Form 285. Damages for fraud. Form 286. Rescission of contract for sale of mine to company. 2. Rescission as in Form 283 (2). 3. Damages for the loss occasioned to him by such fraudulent misrepresentations. 4. An injunction, Form 283 (4). and 5. Or in the alternative as against the defts, damages for the loss occasioned to the plt by such fraudulent misrepresentations, and indemnity against all liability in respect of such shares. The above Form can be used where the plaintiff sues the company and the directors for rescission and damages. It must be borne in mind that a director cannot be made liable in such an action unless it can be proved that he made the misrepresentations, knowing them to be false, or recklessly. See supra, p. 234. And that one director cannot, in general, be made responsible for the fraud of another. Cargill v. Bower, 10 C. D. 502. If the plaintiff has lost his right to rescind the contract (e.g., by winding up, acquiescence or otherwise, supra, p. 232), he cannot sue the company for damages (supra, p. 233), and Form 285 should be adopted. The alternative claim is added so as to provide for the failure or abandonment of the claim for rescission. Indemnity is only required where the contract is not to be rescinded. Cargill v. Bower, ubi supra. Some persons, instead of claiming damages (3), claim "To have judgment against the defendants jointly and severally for the repayment of the amounts paid by the plaintiff upon the said shares, with interest;" but of course this may not cover the damages sustained. See Mathias v. Getts, 46 L. T. 497, where a contract was rescinded, and damages awarded. In Redgrave v. Hurd, 20 C. Div. 1, a contract was rescinded, but the claim for damages failed because there was no allegation that the defendant made the misrepresentations complained of, knowing them to be false. [Plt, A.; defts, A., B., and C.] The plt's claim is for damages for loss occasioned to him by the fraud of the defts, whereby the plt was induced to take 100 shares in the Co, Limtd, and for indemnity against all liability in respect of the sd shares. This Form is for use where the plaintiff sues only the directors, or other persons who, by issuing a fraudulent prospectus, induced him to take shares, and does not seek rescission either because he has lost the right, or prefers to keep the shares, supra, p. 235. The form is available both in the case of common law fraud, and also fraud under s. 38 of the Act of 1867, and, if necessary, the statement of claim can allege an alternative case. See supra, p. 236. [Plt, the co; defts, A., B., C., D., and E.] 1. A declon that an agreemt, dated, &c., and made between the deft, B., of the one pt, and the plt co, of the other pt, and an indre of assignmt, dated, &c., made between the sd deft of the one pt, and the plt co of the other pt, are respively fraudulent and are voidable at the option of the plt co. 2. A declon that the defts are jointly and severally liable to make good to the plt co all profits derived by the defts or any of them in respect of the sale the subject to the sd agreemt and indre. 3. In case the plt co shall elect to avoid the sd agreemt and assignmt, judgmt that the sd agreemt and assignmt be respively set aside and delivered up to be cancelled, the plt co offering to account for all (if any) the profits derived by the plt co in working the mines, the Form 286. 5. Judgmt against the defts jointly and severally for the amount of all money and other profits received or derived by the defts or any of them in respect of such of the sd 50,000 shares as have been sold or disposed of or otherwise received in respect of the sd sale with interest, but in case the plt co shall elect to retain the ppty sold giving credit to the defts for 3,5007., the amount pd by them, with interest at 4 p. c. from January, 1880. 6. 10,0007. damages for the loss occasioned to the plt co by the fraud and collusion of defts. The above is an example of the indorsement used in a case somewhat resembling New Sombrero Co. v. Erlanger, 5 C. Div. 111; 3 Ap. Cas. 1218. The defendants having purchased a property for 3,500l., promoted the plaintiff company, and sold the property to it for 50,000l., without disclosing their profit or position, and made misrepresentations. 1. A declon that the defts are jointly and severally liable to pay to Form 287. the plt co the maximum value with interest of 700 shares in the capital Bribe to of the plt co, which shares were issued to B. as pt of the conson for ppty directors. sold by him to the plt co and were by him gratuitously transferred to the defts, who were directors of the plt co. 2. Judgmt against the sd defts jointly and severally for the paymt of such maximum value with interest. There have been a good many cases in which directors have been held liable for paid-up shares privately given them by the vendor or promoters. See supra, p. 237. And it has been held that in such case they are liable for the maximum value. Nant-y-Glo Co. v. Grove, 12 C. D. 738; and see infra, Form See also Carling's case, 1 C. Div. 115; McKay's case, 2 C. Div. 1; De Ruvigne's case, 5 C. Div. 306; Pearson's case, 4 C. Div. 222; 5 C. Div. 336; Weston's case, 10 C. Div. 579; Mitcalfe's case, 13 C. Div. 169. 322. [Plt, the co. Deft, A.] 1. A declon that the deft is liable to pay to the plt co the sum of Form 288. 10,0007., being the difference between the amount pd by him for the Promoter's Colliery and the amount pd him by the plt co for such colliery, secret profit. and all other profits, if any, made by the deft when promoter or director of the plt co, without its knowledge and consent, with interest; and 2. Judgmt against the deft for paymt accordingly. See supra, p. 239. Form 289. Debenture foreclosure. Form 290. Debenture trust deed. Form 291. Ultra vires agreement. Form 292. Ultra vires resolution. [Plt, A. (on behalf of himself and all other holders of mtge debentures in the deft co). Deft, the co.] The plt claims as a debenture-holder of the deft co 1. A declon that the mtge debentures issued by the deft co, and now outstanding, constitute a first charge upon all the ppty of the co. 2. To have an account taken of what is due and owing to the plt and to the other holders of the sd debentures for principal interest and costs. 3. To have the sd debentures enforced by foreclosure or sale. 4. To have a receiver and manager of the co's ppty appointed. The above is for use in a simple case. In actions by one on behalf care should be taken that the plaintiff has personally a good cause of action, otherwise the action may fail, e.g., where the company has a set-off. Burt v. British Nation Life Association, 4 De G. & J. 158, 174; Huggons v. Tweed, 10 C. Div. 359. And it should be seen that the plaintiff is a proper representative. Daniel Pr. 23 1 ; Wilson v. Church, 9 C. D. 552. Where there are inconsistent interests or subsequent incumbrances the necessary defendants should be added, and if necessary a representation order should be obtained. Fraser v. Cooper, Hall & Co., 21 C. D. 718. See infra, Form 354. As to appeal by one of a class represented by the plaintiff, see Watson v. Cave, 17 C. D. 19. In an action by one on behalf the plaintiff is dominus litis, and before judgment can compromise or abandon the action as he thinks fit. And the company before judgment may pay the plaintiff and get rid of the action. Pemberton v. Topham, 1 Beav. 312; Huggins v. Tweed, 10 C. Div. 359. [Plt, A. (on behalf of himself and all other the holders of debentures entled to the benefit of the indre mentioned in the indorsemt on the writ in this action). Deft, the co.] The plt claims as a debenture-holder of the dft co 1. To have an account taken of what is due from the deft co to the plt and the other holders of debentures entled to the benefit of an indre dated, &c., and made, &c. 2. To have the trusts of the sd indre carried into execution under the order of the Ct. 3. To have a receiver and manager of the ppty comprised in the sd indre appointed. The defts and are sued as trustees of the sd indre. As to actions on behalf, see note to Form 289. [Pl, A. (on behalf of himself and all other shareholders in the deft co, except those who are defts). Defts, the co and the directors.] The plt's claim is for a declon that an agreemt dated, &c., and made, &c., is ultra vires the deft co and for an injunction to restrain the defts from carrying the sd agreemt into effect. See Russell v. Wakefield Waterworks, 20 Eq. 474, as to parties in such actions. [Plt, A. (on behalf of himself and all other holders of B. Shares in the deft co, except those who are defts). Defts, the co and the directors.] |