Actions by and against Companies. For the other decided cases on this subject, the reader is referred to the Digest of Joint-Stock Company's Cases that follows this sketch of the law; titles, "Contract" and " Directors." Actions by and against Companies. A Company incorporated under this act may sue and be sued by its corporate name, in respect of any claim by or upon the Company upon or by any person, whether a member of the Company or not, so long as any such claim may remain unsatisfied. Where a Limited Company is plaintiff in any action, suit, or other legal proceeding, any judge having jurisdiction in the matter may, if he has reason to believe that defendant, if successful, may not recover his costs against the assets of the Company, require sufficient security for such costs to be given: (sect. 69.) In an action against a member for calls, or other moneys due in his character of member, it is not necessary to set forth the special matters, but sufficient to allege that defendant is a member, and indebted to the Company, &c., as the case may be (sect. 70.) By sect. 72 Companies are empowered to agree to refer to arbitration, in accordance with "The Railway Companies Arbitration Act, 1859," any difference or matter in dispute between itself and any other Company or person, and all the provisions of that act are to apply to such reference. a Power to hold Land-Conveyance, &c. Power to hold Land. By implication, Trading Companies may hold land without limit, for sect. 21 merely prohibits Companies formed to promote art, science, religion, charity, or other like object, from doing so beyond the extent of two acres, without a licence from the Board of Trade, which is empowered to authorize any such Company to do so, in such quantity and subject to such conditions as it may think fit. By the former acts no Companies were allowed to hold more than two acres of land without a licence from the Board of Trade. But this restriction being removed, there is now no other limit than such as might be imposed by the law of Mortmain. Conveyance by and to Companies. The former act provided a short form for mortgage by Companies. This is now omitted, and the only provision relating to deeds is in sect. 55, which empowers a Company by writing under its common seal to appoint a person as its attorney to execute deeds on its behalf, in any place not in the United Kingdom. Official Examination of the Affairs of a Company. If members are dissatisfied with the management, and desire an investigation into the affairs of the Company, the Board of Trade may appoint one or more inspectors to examine into the affairs of the Company, and to report thereon, on either of the applications following: Official Examination of the Affairs of a Company. (1.) In the case of a banking Company that has a capital divided into shares, upon the application of members holding not less than one-third part of the whole shares of the Company for the time being issued: (2.) In the case of any other Company that has a capital divided into shares, upon the application of members holding not less than one-fifth part of the whole shares of the Company for the time being issued: (3.) In the case of any Company not having a capital divided into shares, upon the application of members being in number not less than one-fifth of the whole number of persons for the time being entered on the register of the Company as members. Such application is to be supported by such evidence as the Board of Trade may require, that it is bonâ fide and not from malicious motives, and the Board may require the applicants to give security for costs: (sect. 57.) Officers and agents of the Company are to produce to the inspectors all books and documents. The inspectors are empowered to examine upon oath the officers and agents of the Company in relation to the business. When the examination is concluded, the inspectors are to report their opinion to the Board of Trade, and a copy of such report is to be sent by the Board of Trade to the Company's office, and a further copy to the members who had requested the examination. The expenses of and incidental to such examination are to be defrayed by the members upon whose application the inspectors are appointed, unless the Board of Trade shall direct them to be paid out of the assets of the Company: (sect. 59.) Legal Proceedings by and against Companies. But the Company may, by special resolution, appoint inspectors for the same purpose and with the same powers and duties, only that instead of making their report to the Board of Trade they are to report in such manner as the general meeting may direct, and officers and others refusing to produce books or papers, or to answer inquiries, are to be subject to the same penalties. A copy of any such report of inspectors, under the seal of the Company is to be admissible in any legal proceeding as evidence of the opinions of the inspectors making the report: (sects. 60, 61.) Legal Proceedings by and against Companies. Strange to say, the new act omits all provisions for assisting general creditors to the recovery of their debts. It therefore remits them to their common law rights. But these rights are not the same as in the case of partnerships, where the judgment creditor may take out execution against any one or more of the partners. Partnerships regulated under the new act are incorporated, and possess corporate privileges, one of which is that execution can issue only against the corporate property, and not against individual members of the corporate body. Hence the exclusion from the new law of all the provisions of the old law, which regulated the manner of recovering from a Company after judgment had against it. You cannot now take out execution against a shareholder even for so much of his shares as are unpaid. You can proceed only against the corporate property. Should there be Legal Proceedings by and against Companies. none, your only resort will be to the winding-up clauses of the new act. You may cause the Company to be wound-up, indeed; but you will do so at your own risk, for if the Company is limited and the shares are paid up, the ruinous cost of winding-up will fall upon you. The intolerable injustice of this will be apparent, when it is remembered that, whereas the cost of taking out execution against shareholders, as formerly, would not be more than 57. the costs of windingup, which is the only remedy now given to you, might be 5007. The course of proceeding is, therefore, when a judgment has been obtained against a Company, Either to take out execution against the corporate property; or, If none be found on which to levy, to apply to the court by petition for an order that the Company be wound-up in pursuance of the provisions of sect. 79. If a Company is indebted in more than 50%., the creditor may demand payment in writing, and if it be not paid within three weeks, or security given for it, the Company may be wound-up: (sect. 80.) For the practice of winding-up, see post. Offences under the act made punishable by penalties are to be prosecuted In England before two or more justices. In Scotland, before two or more justices or the In Ireland, in the manner directed by 14 & 15 |