1. Companies formed and registered under the Companies Act, 1862. *168

Any seven or more persons associated for any lawful purpose may form a company under this act (§ 6). It is not even necessary that gain shall be the object of the company. (e)

A company is formed under the act of 1862, by the registration of a memorandum of association, bearing a deed stamp, Memorandum and subscribed by seven or more persons, in the pres- of association. ence of, and attested by one witness at least (see §§ 8-11 and 17 and 18, and the forms in sched. 2).

This memorandum must contain, 1, the name of the proposed company; 2, the part of the United Kingdom in which the regis tered office of the company is to be; and, 3, the objects for which the company is to be established (§§ 8-10, and sched. 2). If the company is to be limited by shares, the memorandum must also state, 4, that the liability of the members is limited; and, 5, the amount of proposed capital, and the shares into which it is to be divided (§ 8, and sched. 2, form A.). If the company is to be limited by guarantee, the memorandum must contain, in addition to the three things first above mentioned, a declaration that each member will, if necessary, contribute to a specified amount on the winding up of the company ($ 9, and sched. 2, forms B. and C.). If the company, whether limited or unlimited, has a capital divided into shares, each subscriber to the memorandum must write opposite his name, the number of shares he takes, and he must take one at least (38 and 14).

Articles of

The memorandum of association must, in the case of an unlimited company, and of a company limited by guarantee, and may, in the case of a company limited by shares, association. be accompanied, when registered, by articles of association, prescribing *regulations for the company (§ 14, and sched. *169 2, forms B. and C.). These articles must be printed and be

(e) See 30 & 31 Vict. c. 131, § 23. No questions, therefore, can arise under the act of 1862, similar to those which arose under 7 & 8 Vict. c. 110. See as to the application of that act to projected railway companies. Abbott v. Rogers, 16 C. B. 277; to companies not

having gain for their object, R. v. Whitmarsh, 15, Q. B. 600; Bear v. Bromley, 18 ib. 271; Moore v. Rawlins, 6 C. B. N. S. 289; to companies, the formation of which was commenced before 1st Nov. 1844, Shaw v. Holland, 15 M. & W. 136.

stamped with a deed stamp, and be signed by the subscribers to the memorandum of association, in the presence of, and attested by one witness at least ( 14 and 16). In the case of a company having a capital divided into shares, and not being limited by shares, the articles must state the amount of the proposed capital; and in the case of a company not having such a capital, the articles must state the number of members with which the company proposes to be registered (§ 14).

Table A.

The first schedule of the act, table A., contains a set of regulations which may be adopted, wholly or in part, by any company, and which apply to companies limited by shares, unless the contrary is expressed in their registered articles ($ 14 and 15). These regulations closely resemble those contained in table B., in the repealed act of 1856. They have evidently bcen framed with care, and they should be adopted, as far as possible, in all cases. The Board of Trade has power to alter them, but not retrospectively (§ 71.)

memorandum

and articles.

The memorandum of association and the articles, if any, are to Registration of be delivered to the registrar of joint-stock companies, who is required to retain and register them (§ 17). Certain fees are payable upon their registration (§ 17). After their registration, the registrar is required to certify registration. that the company is incorporated, and in the case of a limited company, that it is limited; and his certificate is conclusive evidence that all the requisitions of the act in respect of registration, have been complied with (§ 18). (ƒ)

Certificate of

memorandum

The memorandum of association and the articles of association Construction of ought to be consistent with each other, and they ought, and articles. if possible, to be construed so as to make them consistent. (g) But if the two conflict, the articles must give way to the memorandum, for that is the more important document of the two, and cannot be altered except in certain particulars specified in the statutes. (h) Many cases illustrating this general rule will be met with hereafter, when considering the powers of *170 *directors and majorities, and the liabilities of the subscribers of the memorandum. (¿)

(f) Ante, p. 163.

(g) See Felgate's case, 2 De G. J. & Sm. 456.

(h) See § 12 of the act of 1862, &

§§ 8, 10, 21, of the act of 1867.

(i) See particularly Ashbury Rail. Carriage Co. v. Riche, L. R. 7 H. L. 653; Dent's case, 8 Ch. 776.

The act in substance declares that the subscribers of the memorandum of association (§§ 18 and 23), and all persons who are memwho have agreed to become members, and whose names bers. are entered in the register of members, shall be deemed members of the company (§ 23). It is conceived that persons who sign copies of the memorandum before it is registered are members under this act, as they were held to be under the act of 1856. (k)

It is very difficult to see how any person who signs the memorandum of association can be held not to be a member. But in Felgate's case (1), a person who had signed the memorandum and articles of association was held not to be a contributory, as the articles he had signed had been tampered with before they were registered. He was held not to be bound by the articles, and not being bound by them, he was held not bound by the memorandum.

With respect to other persons it is to be observed that no particular form of agreement is necessary (m); but a question may arise on this act, as on the Companies clauses consolidation act, whether a person may not be a member, although his name is not on the register. In considering this question regard must be had to the right of companies to put persons on the register (n), to the provisions for its rectification (o), and to the extent to which a person may have acted and been treated as a member. (p)

A certificate under the seal of the company, specifying any shares or stock held by a member, is primâ facie certificate of evidence of his title to the shares or stock therein specified (§ 31). (g)

title.

members.

*Every company registered under the act is *171 Register of bound to keep at its registered office (§ 32) a register of its members; and the register must contain their names and addresses, occupations, and the number of shares, if any, held by them, and the amounts paid, or agreed to be considered as paid, in respect of such shares, and the dates at which the members were

(k) New Brunswick Rail. Co. v. Boore, 3 H. & N. 249.

(1) 2 DeG. F. & J. 456. This case turned on the act of 1856, but there does not appear to be any difference between that act and the act of 1862, so far as this subject is concerned.

(m) This gets rid of New Brunswick Rail. Co. v. Muggeridge, 4 H. & N. 160

and 580. See Bog Lead Mining Co. v. Montague, 8 Jur. N. S. 310.

(n) Ante, p. 127.
(0) $$ 35 and 98.
(p) Ante, p. 128.

(q) The right to demand this certificate is not given by the act, but only by Table A, Nos. 2 and 3. See as to these certificates, ante, p. 145.

registered, and the dates at which they ceased to be members (§ 25). No notice of any trust is to be entered on the register (§ 30). The register is primâ facie evidence of all matters directed or authorized to be inserted therein (§ 37). (r)

Correction of register.

The 35th section provides for the rectification of the register, and is extremely important. (8) Its effect is that if the name of any person is without sufficient cause entered in or omitted from the register of members; or if default is made or unnecessary delay takes place in entering on the register the fact of any person having ceased to be a member of the company, he or any member of the company or the company itself may obtain an order for the rectification of the register. The order may be obtained from any division of the High Court.

A difference of opinion has been expressed as to the correct interpretation of this section. Some consider that under it the register may be rectified whenever it can be shown by any person who is on or off the register himself that some other person ought as between themselves to be in his place (t); whilst others consider that the section does not admit of so wide an interpretation, being confined to the cases specified in its commencement (u), viz:

1. To cases where the name of a person is without sufficient cause entered in or omitted from the register.

2. To cases where default is made or unnecessary delay takes place in entering on the register the fact of any person having ceased to be a member of the company.

Correction of *172
register under
235.

*The more restricted interpretation, it will be observed, renders the section inapplicable except where the company fails in discharging the duty imposed upon it of keeping a proper register; and the more extensive interpretation prevailed in the latest case decided by the Court of Appeal. (v)

It must be borne in mind that before a company is being wound up its register is much more readily rectified than after the winding up has commenced, and the rights of creditors have to be con

(r) See, as to the register when fully paid-up shares have been replaced by share warrants transferable by delivery, 30 & 31 Vict. c. 131, § 31.

Musgrave and Hart's case, 5 Eq. 193; and the judgment of Turner, L. J., in Ward and Henry's case, 2 Ch. 431.

(u) Ex parte Ward, L. R. 3 Ex. 180;

(8) See on the correction of registers Shepherd's case, 2 Ch. 16; and see Lord generally, ante, pp. 142-143.

(t) See Ex parte Shaw, 2 Q. B. D. 463; Ward and Garfit's case, 4 Eq. 189;

Cairns' judgment in Ward and li ny's case, 2 Ch. 431; Marino's case, 2 Ch.96. (v) Ex parte Shaw, 2 Q. B. D. 463.

sidered. The rectification of the register in connection with the settlement of the list of contributories will be considered hereafter; in the present place those decisions only will be referred to which relate to the rectification of the register of a going company.

The 35th section not only authorizes the correction of mistakes. but also the determination of important conflicting rights, going further in this respect than the corresponding section of the Companies act, 1856. (w) As however trusts are not noticed (§ 30) the title to be investigated is the legal title or the right to acquire it. (x) If this legal title is clear, and there is no difficult question of fact to be investigated, the Court will rectify the register without directing any action to be brought (y); but the Court has a discretion as to whether it will interfere summarily under the act or direct an action, and will be guided by the nature of facts in dispute and by the desirability of having them investigated by a jury. (2) The circumstance, however, that the company has itself rectified the register does not preclude the Court from ordering it to be rectified; an order of the Court being often of great importance to the applicant. (a)

Instances of

*173 rectification.

Registers will be rectified at the instance of persons who have been registered as members without having entered into any contract to take shares (6); so where the contract they have entered into is void (c); so where the contract being voidable it has been duly avoided by the alleged shareholder. Thus registers have been rectified where persons have taken shares on the faith of a prospectus with which the company's memorandum of association does not correspond (d); so where a person has been induced by the

(w) As to which, see British Sugar Refining Co. 3 K. & J. 408.

(x) Ex parte Sargent, 17 Eq. 273; Parker's case, 2 Ch. 685.

(y) Ex parte Shaw, 2 Q. B. D. 463. (z) See the last case; Askew's case, 9 Ch. 664, where an action was directed to try a question of fraud; Simpson's case, 9 Eq. 91, where a bill was directed to be filed. The difficulty here mainly turned on the construction of documents, and qu. the advantage of directing an action in such a case.

(a) Martin's case, 2 Hem. & M. 669. (b) Los' case, 6 N. R. 327; Higg's case, 2 H. & M. 657; Martin's case, ib. 659, where the name had been removed already; Baily's case, 5 Eq. 428; 3 Ch. 592; Somerville's case, 6 Ch. 266, 271.

(c) Stace and Worth's case, 4 Ch. 683. (d) Stewart's case, 1 Ch. 574; Webster's case, 2 Eq. 741; Downes v. Ship,. L. R. 3 H. L. 343, and Ship's case, 2 De G. J. & Sm. 544; Breckenridge's case, 2 Hem. & M. 642. See ante, p. 107.