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protection just as much as creditorsâperhaps even more; shareholders are not partners for all purposes; they have not all the rights of partners; they have practically no voice in the management of the concern. Their security in a great measure depends on the directors adhering to the requirements of the Act.â Any one who is familiar with the
Companies Acts knows perfectly well that these registered limited companies are incorporated on certain conditions; they continue to exist on certain conditions; and they are liable to be dissolved on certain conditions. The important sections of the Act of 1862, with regard to dissolution, are ss. 79 and 82. Sect. 79 states the circumstances under which such a company may be dissolved by the Court, and s. 82 states the persons who may petition for a dissolution. Any article contrary to these sectionsâany article which says that the company is formed on the condition that its life shall not be terminated when any of the circumstances mentioned in s. 79 exist, or which limits the right of a contributory under s. 82 to petition for a winding-up, would be an attempt to enforce on all the shareholders that which is at variance with the statutory conditions, and is invalid. It is no answer to say that the right to petition may be waived by any contributory personally. I do not intend to decide whether a valid contract may or may not be made between the company and an individual shareholder that he shall not petition for the winding up of the company. That point does not arise now. But to say that a company is formed on the condition that its existence shall not be terminated under the circumstances, or on the application of the persons, mentioned in the Act is to say that it is formed contrary to the provisions of the Act, and upon conditions which the Court is bound to ignore. The view taken by Byrne J. was right, and the appeal must be dismissed.
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case concerning liquidation when a company is unable to repay its debts. It held that a member cannot be prevented by a company constitution from bringing a winding up petition. It is, however, possible for a member to make a shareholder agreement and thus contract out of the right to bring a winding
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AC 324: âThese companies are the creature of statute, and by the statute to which they owe their being they must be bound in regard to shareholders as well as in regard to creditors in all matters coming within the conditions of the memorandum of association. Shareholders in these companies require
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of
Peveril Gold Mines Ltd said no member should petition for winding up unless two directors had consented or the general meeting had resolved or a petitioner held at least 20% of issued capital. A member asked for winding up without satisfying any of these conditions.
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held that the member was entitled to do so. He said âthese registered limited companies are incorporated on certain conditions; they continue to exist on certain conditions; and they are liable to be dissolved on certain conditions.â He pointed to the predecessors of
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sections 122 and sections 124 and said they set out circumstance when a company can be dissolved by the court and who can petition. A member could not be restricted.
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I will begin by reading the following passage from the speech of Lord
Macnaghten in
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Ayerst (Inspector of Taxes) v C&K (Construction) Ltd
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399:Court of Appeal (England and Wales) cases
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378:Principles of Corporate Insolvency Law
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109:up petition outside of the company.
268:Re Windsor Steam Coal Co (1901) Ltd
394:United Kingdom insolvency case law
380:(4th edn Sweet & Maxwell 2011)
368:Cases and Materials in Company Law
348:Cases and Materials in Company Law
306:Stonegate Securities Ltd v Gregory
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346:L Sealy and S Worthington,
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119:articles of association
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409:1898 in British law
256:Pulsford v Devenish
206:Insolvency Act 1986
158:Vaughan Williams LJ
136:Insolvency Act 1986
70:Vaughan Williams LJ
370:(9th edn OUP 2010)
329:UK insolvency law
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223:(1879) 11 Ch D 36
198:Liquidation cases
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92:Liquidation
388:Categories
357:References
283:1 WLR 1091
154:Chitty LJ
66:Chitty LJ
259:2 Ch 625
247:1 Ch 122
235:1 Ch 717
164:See also
126:Judgment
86:Keywords
48:1 Ch 122
45:Citation
374:R Goode
309:Ch 576
297:AC 167
271:Ch 609
210:73-174
335:Notes
113:Facts
35:Court
316:see
156:and
117:The
208:ss
390::
376:,
366:,
191:e
184:t
177:v
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