the register, and as to the liability of contributories in respect of shares issued as fully paid up, vide, p. 33.

(3) By allowing their names to remain on the register of members.

Unless a person registered as a shareholder, who is entitled to a rectification of the register on the ground that he was induced to take his shares by fraud, has avoided the contract before the winding-up, he is liable as a contributory. [Oakes v. Turquand, 2 H. L. 325.]

But where the contract is not voidable, but void, as where the alleged shareholder had never agreed to become a member, the winding-up is no bar to a rectification of the register. [Alabaster's Case, 7 Eq. 273.]

Nor is it where a shareholder's name is left on the register after he has properly ceased to be a member. [Lyster's Case, 4 Eq. 233.]

(4) By accepting an office under the company to the holding of which a share qualification is essential.

Thus where a director required a certain qualification of shares, but never applied for or had any allotted to him, it was held in a winding-up that he must be settled on the list of contributories in respect of his qualification. [Kincaid's Case, 11 Eq. 192], as to further cases, vide, p. 76.

(5) By taking a transfer of shares.

Where a shareholder whose name appears, at the commencement of the winding-up, on the register of members, is not in fact the owner of the shares, but had at the time of being put upon the list of contributories bona fide transferred his shares to someone else, he is entitled to apply to have his name removed from the A list. For this purpose he must prove the fact, and must in general have his transferee before the Court to have the fact established. [Thomas Brown's Case (Eur. Arb.), L. T. 103.]

But if the transferor has been guilty of laches, as where he allowed two years to elapse without insisting on registration of

the transfer and the company wound up, he was held liable as a contributory. [Walker's Case, 6 Eq. 30.]

If however non-registration of a transferee is owing to the improper delay on the part of the company, the transferor's name will be taken off the register. [Low's Case, 9 Eq. 589; Hill's Case, 4 Ch. 769.]

Where a transfer was not registered through default of the company, and after a winding-up order the transferee died without a legal personal representative, it was held that as there was no laches on the part of the transferor that his name must be removed from the list of contributories; it was further held that the fact that the transferee had no legal representative, and that consequently there was no person who could be put on the list in the place of the transferor, was immaterial. [Fyfe's Case, 4 Ch. 768.]

In the winding-up of a company, a shareholder, who has become bankrupt, becomes a stranger to the company and cannot be placed on the list of contributories, neither can his trustee in a bankruptcy, whether prior or subsequent to the winding-up, be placed on the list if he shall have executed a disclaimer under the Bankruptcy Act, 1869, s. 23. [Ex parte Budden and Roberts, 12 Ch. D. 288; see Cape Breton Co., 19 Ch. D. 77.]

When a shareholder becomes bankrupt all calls in arrear are provable as debts, and his liability to future calls may be estimated and proved as well when the company is being wound up as when it is not. The 75th section of the Companies Act, 1862, refers only to contributories as distinguished from members.

"B" LIST.

The B list consists of past members who have ceased to be shareholders of the company within one year prior to the commencement of the winding-up. Those who have ceased to be members for a longer period than one year before the commencement of the winding-up are free from all liability for calls.

No B contributory is liable to contribute in respect of any debt or liability of the company contracted after the time at which he ceased to be a member.

No B contributory is liable to contribute to the assets of the company until the Court is satisfied that the A list has been individually exhausted, and is unable to satisfy the contributions required to be made; until this is shewn the Court will not settle the B list. [McEwen's Case, 6 Ch. 582.]

The liability of each B contributory arises only on default being made by the holder of the shares he had previously held [Weston's Case, 6 Eq. 17], and is limited to the residuum of such of the liabilities incurred before he ceased to be a member as remain unsatisfied.

It should be observed that where the same shares have been transferred several times during the year preceding the liquidation all the transferors are liable to be placed on the B list in respect of the shares, and if default is made by the ultimate transferee they all become simultaneously liable for the amount unpaid. As between themselves each transferor has a right to claim indemnity from his transferee. [Morris's Case, 7 Ch.

200; 8 Ch. 800.]

The B contributories are liable to pay those costs only which are occasioned by settling the B list. [Webb v. Whiffin, 5 H. L. 711.]

The contributions received from the B list are not specially applicable for the payment of the debts in respect of which they were made, but become assets of the company generally, and therefore applicable pari passu to all the debts of the company. [Accidental and Marine Insurance Co., 5 Ch. 428.]

The compromise with some of the existing members of a company effected by the liquidator with the sanction of the Court cannot operate as a release to the past members, the two classes of persons do not stand to each other in the relation of principal and surety. [Helbert's Case, 6 Eq. 559.] A similar compromise with an A contributory does not

operate to discharge the liability of any B contributory settled on the list in respect of those shares. The liability of the B contributory is statutory. [Hudson's Case, 12 Eq. 1.]

The discharge of a contributory in class A by a compromise with the liquidator does not absolve him from his implied contract to indemnify the transferor, who has been placed as a contributory in class B, against future calls. [Roberts v. Crow, 7 C. P. 629.]

The liability of a past member of the company in liquidation, who is placed on the B list of contributories, is capable of being proved as a debt, under the bankruptcy of such contributory, if the bankruptcy takes place after the commencement of the winding-up; and the bankrupt on obtaining his discharge is entitled to be removed from the list of contributories. The fact that the B list is not made out till after the adjudication of bankruptcy makes no difference. [McEwen's Case, 6 Ch. 584.]

The liability of a B contributory is entirely created by the Companies Act, 1862, and it is immaterial whether his shares have been transferred or have been extinguished by forfeiture, in either case he is properly placed upon the list of past members as a contributory. [Creyke's Case, 5 Ch. 63.]

After the B list is settled the making of a call upon the B contributories is within the discretion of the Court, and the call will not be made if the Court is satisfied that there are sufficient assets in the hands of the liquidator; but it will be made if there are only outstanding assets, the realization of which is doubtful both as to amount and time.

The Companies Acts having taken away from the creditors of a company the right to a remedy by the ordinary process of an action, the Court will not favour delay in providing the means of satisfying their claims under a winding-up. The affidavit to satisfy the Court that a call ought to be made need not enter into minute details to show why the liquidator declares himself only able to realize a certain sum, but must state

reasonable grounds for that opinion. B contributories who deem the statements of the liquidator insufficient to justify calls being made on them must not wait until judgment has been pronounced on these statements and has been made the subject of appeal, but must at the time of these statements being made submit them to the process of cross-examination. [Helbert v. Banner, 5 H. L. 29.]

The cancellation of shares by directors prior to a winding-up where the shareholder has valid grounds for repudiation is good and effectual, and the shareholder is not liable to be settled as a contributory either as a present or as a past member. [Wright's Case, 7 Ch. 55.]

CALLS.

The Court may at any time after a winding-up order has been made and either before or after it has ascertained the sufficiency of the assets of the company, make calls on and order payment thereof by all or any of the contributories for the time being settled on the list of the contributories to the extent of their liabilities, for the payment of all or any sums the Court deems necessary to satisfy the debts and liabilities of the company, and the cost of the winding-up, and for the adjustment of the rights of the contributories amongst themselves. [C. A. 1862, s. 102.]

The Court will in making a call take into consideration the probability that some of the contributories upon whom the call is made may wholly or partly fail to pay their respective portions of the same.

Every application to a judge for the purpose of making a call must be by summons stating the proposed amount of the call; such summons must be served at least four clear days before the day appointed for making the call on every contributory proposed to be included in such call, or if the judge should so direct, notice of such intended call can be given by advertisement.