Prec. VI.

appointed, and that for the purposes aforesaid all necessary and proper directions may be given; or, 2. That your petitioner may have such further or other order as to the Court shall seem meet.

NOTE.-It is [supra, p. 610.]

And your petitioner, &c.

* Although not necessary, it is very common, where it is desired that a provisional liquidator should be appointed, to allege the expediency in and pray for an appointment by the petition. See further, infra, p. 627.

Prec. VII.

PRECEDENT VII.

PETITION OF SIMPLE CONTRACT CREDITOR.

In [supra, p. 610].

In the matter of The

Company, Limited.

And in the matter of the Companies Acts, 1862 and 1867.

Incorporation. 1. The above-named company (hereinafter called the company) was registered with articles of association on the day of

Office.

Object.

Petitioner's debt.

Amount due.

under the above-mentioned Acts.

2. The registered office, &c.

3. The objects for which the company was established as stated in the memorandum of association thereof are as follows:

— and

4. Between the day of day of your petitioner supplied timber and other building materials to the company to the amount of 230l. 12s. 6d. Accounts and invoices of the goods so supplied were from time to time furnished to the company, and payments on account were made by it to the petitioner.

5. There now remains due and owing from the company to the petitioner a sum of 737. 188., being the balance of the said sum of 2301. 12s. 6d.

6. The petitioner has made repeated and urgent applications Prec. VII. to the company for payment of the said sum due to him, but Applications the company has neglected to pay or satisfy the same. The for payment. company does not dispute the fact that the said sum is due to

your petitioner.

See supra, p. 597.

7. The business of the company has been carried on for Losses of several years past at a loss, and the loss in respect thereof company. during the year ending on the 10th day of November, 18—, was, as your petitioner has ascertained, the 3,7221. 88. 9.

sum of

8. Acceptances of the company to a considerable amount will Acceptances shortly arrive at maturity, and the company has no means of falling due. providing for the payment thereof.

9. The company is indebted to general and unsecured Debts of comcreditors in respect of goods supplied and materials delivered, pany. and on other accounts to an amount including the said accept

ances of 4,7817. 78. 2d.

issued.

10. The company has raised the sum of 7,0007. upon mort- Mortgage degages of part of its property, and has issued mortgage deben- bentures tures charging its undertaking and assets (subject to the said mortgage) to the amount of 2,7007. or thereabouts.

11. In addition to a considerable number of shares issued as Shares issued. fully paid up to the promoters of the company as the consideration for services rendered, or alleged to have been rendered, by them to the company, about 3,700 shares have been issued to the public, and the full amount of 51. per share has been called up thereon. Calls to the amount of £ remain unpaid on divers of the said shares.

12. The company is unable to pay its debts, and the assets thereof are insufficient to provide for and satisfy all its debts and liabilities.

See supra, p. 597.

13. It is necessary for the protection of the property of the company, and for the interest of the creditors thereof, that a provisional official liquidator should be immediately appointed. Your petitioner therefore, &c.

Company cannot pay its debts.

Provisional liquidator necessary.

PRECEDENT VIII.

Prec.VIII. PETITION TO COURT TO STAY PROCEEDINGS IN A WINDING

Formation of company.

Office.

Objects.

In Chancery.

Lord Chancellor.

UP (a).

Vice-Chancellor James.

This petition was presented

under the old practice, August, 1869.

In the matter of the Companies Acts, 1862 and

1867.

And in the matter of the South Barrule Slate Quarry

Company, Limited.

To the Right Honourable The Lord High Chancellor of Great Britain.

The humble petition of C. E. W., of, chairman of the directors, and a contributory of the above-named company.

Showeth :

1. That the above-named company was duly formed and registered as a company limited by shares pursuant to the Companies Act, 1862.

2. That by the memorandum of association of the said company, which has been duly registered, it was declared that the registered office of the company was to be in England, and that the objects for which the said company was to be established were the purchasing and working of quarries and beds

(a) By Section 89 of the Act it is provided as follows:

"The Court may at any time after an order has been made for winding up a company, upon the application by motion of any creditor or contributory of the company, and upon proof to the satisfaction of the Court that all proceedings in relation to such winding up ought to be stayed, make an order staying the same, either altogether or for a limited time, on such terms and subject to such conditions as it deems fit."

The power given by this section has been exercised in a considerable number of cases.

In the South Barrule Slate Quarry Company, 8 Eq. 688, a supervision order had been made and all the debts having been paid, and there being a balance in the liquidator's hands sufficient to meet arrears of current expenses, the great majority of the members were desirous that an arrangement should be sanctioned for the resumption of business by the company, and that the winding up should be stayed. A petition, of which a copy is given above, was thereupon presented to the Court praying for an order to stay further proceedings. It was opposed by one shareholder only, and under the circumstances, James, V.-C., made

of slate and stone, and the preparing and selling off the pro- Prec.VIII. duce therefrom, and the doing of all such other things as were or might be incidental or conducive to the attainment of the above objects, or any of them. And it was by the said memorandum further declared that the nominal capital of the company was 200,000l. divided into 80,000 shares of 21. 10s. each.

3. That no articles of association of the said company have No articles. ever been registered.

4. That of the above-mentioned number of 80,000 shares 20,000 and no more have been actually issued, and of these

the order prayed for. "I do not think," (said the V.-C.) "I can allow one man to stand in the way of the wishes of all his fellow shareholders; and I do not think Mr. Moffat is justified in resisting the present application. But I will allow him an opportunity, if he likes, of retiring from the company, upon being paid the value of his present interest. There will be an order as prayed; and Mr. Moffat is to have fourteen days from this date within which to elect whether he will remain a member of the company, or will retire and give up his shares. If he elects to retire, there will be a reference to chambers to inquire the value of his interest in the slate quarry; such value to be paid to him by the petitioner. The costs of the inquiry will be reserved." For the order made, see Pemberton on Judgments, 1st Ed., p. 671.

See also In re The Western of Canada Oil, &c., Co., W. N. 1874, 148, where an arrangement with the creditors of the company was sanctioned and a qualified order staying proceedings made.

See, too, In re Bristol Victoria Pottery Co., W. N. 1872, 85.

Section 89 only applies to a winding up by, or subject to the supervision of, the Court, but by the joint effect of Section 138 and that section, an order staying proceedings may be made in a voluntary winding up.

Section 138 is as follows:

"Where a company is being wound up voluntarily, the liquidators or any contributory of the company may apply to the Court in England, Ireland, or Scotland, or to the Lord Ordinary on the Bills in Scotland in time of vacation, to determine any question arising in the matter of such winding up, or to exercise, as respects the enforcing of calls, or in respect of any other matter, all or any of the powers which the Court might exercise if the company were being wound up by the Court; and the Court or Lord Ordinary, in the case aforesaid, if satisfied that the determination of such question, or the required exercise of power, will be just and beneficial, may accede, wholly or partially, to such application, on such terms and subject to such conditions as the Court thinks fit, or it may make such other order, interlocutor, or decree on such application as the Court thinks just."

The power to stay proceedings in a voluntary winding up was exercised by Hall, V.-C., in the case of The Bog Mining Co., Limited, Law Journal, Notes of Cases, 1875, 48; and by Malins, V.-C., in the case of The Woollen Trade Association, Limited, 12 Nov., 1875.

What shares issued.

Prec.VIII. 8,200 have been issued as fully paid-up shares, and 11,800 as

Petitioner a

ordinary shares.

5. That your petitioner C. E. W. is the chairman of the contributory. board of directors of the said company, and has been settled upon the list of contributories of the said company as being, and he is the registered holder of 100 ordinary shares, upon each of which there has been paid the sum of 21., and there still remains the sum of 10s. per share to be called up.

Resolutions to wind up and appointing liquidators.

Supervision order.

6. That in accordance with notice for that purpose duly given, an extraordinary general meeting of the said company was duly held at the Inns of Court Hotel, Holborn, London, upon the 1st day of February, 1869, when two several extraordinary resolutions of the intention to propose which notice had been previously duly given, were passed by the unanimous vote of all the shareholders then present at the meeting, with the exception of the chairman at such meeting, who declined to vote upon the question, and such two last-mentioned extraordinary resolutions were in the following terms:

1. "That it having been proved to the satisfaction of this meeting that this company cannot by reason of its liabilities, continue its business, it is desirable to wind up the said company, and that accordingly the said company be wound up voluntarily under the provisions in that behalf in the Companies Acts, 1862 and 1867, and that liquidators be forthwith appointed, the powers of the directors being reserved and continued for the next resolution hereunder."

2. "That the said liquidators, or the directors, shall be at liberty, if they see fit, at any time to present a petition to the Court of Chancery for an order of the said Court for continuing the voluntary winding up subject to the supervision of the said Court, so as to have the assistance and direction of the Court from time to time."

And by another extraordinary resolution of the said extraordinary general meeting, C. R. J. and F. J. W., were duly appointed the liquidators for winding up the said company, and they accepted such appointment.

7. That by an order of this Honorable Court, made in the above-mentioned matters, on the 23rd day of February, 1869, upon the petition of the said liquidators, it was ordered that