The transfer of shares - Free Essay Example

Sample details Pages: 5 Words: 1420 Downloads: 9 Date added: 2017/06/26 Category Law Essay Type Case study Did you like this example? Question 1 The relevant provisions in the articles of association of Treeng Ltd (à ¢Ã¢â€š ¬Ã…“Treengà ¢Ã¢â€š ¬Ã‚ ) are twofold. First, the directors are empowered to refuse to register a transfer of shares, and it seems that they may exercise this power in their absolute discretion. At common law, however, such power must be exercised à ¢Ã¢â€š ¬Ã…“bona fide in what they consider à ¢Ã¢â€š ¬Ã¢â‚¬Å" not what a court may consider à ¢Ã¢â€š ¬Ã¢â‚¬Å" is in the interests of the companyà ¢Ã¢â€š ¬Ã‚ [1] and the decision to refuse to register a transfer must be a positive act taken by the board, not a mere failure to approve the registration[2], but the directors do not need to give reasons for their refusal[3]. Don’t waste time! Our writers will create an original "The transfer of shares" essay for you Create order Secondly, the articles provide that the directors must notify the transferee of their refusal within two months. This is consistent with the requirement imposed by section 183(5) of the Companies Act 1985 (à ¢Ã¢â€š ¬Ã…“CA 1985à ¢Ã¢â€š ¬Ã‚ ), which also provides for a penalty if this requirement is breached (section 183(6) and Schedule 24 CA 1985). These provisions are currently still in force, and will be effectively recast in sections 771(1)(b), (3) and (4) of the Companies Act 2006 (à ¢Ã¢â€š ¬Ã…“CA 2006à ¢Ã¢â€š ¬Ã‚ ) when the latter provisions come into force. The articles appear to be silent on the issue of pre-emption rights of other members, and the issue will therefore not be considered further. Arnold lodged the transfer of the shares to Bill with Treeng immediately after its execution four months ago, but the transfer has not been registered by the company and Bill has not been notified of any decision by Treengà ¢Ã¢â€š ¬Ã¢â€ž ¢s directors. The transfer of shares is not complete until Bill is registered as the new owner of the shares in the register of members, although Bill may have an equitable interest in the shares if he purchased them[4]. However, the directorsà ¢Ã¢â€š ¬Ã¢â€ž ¢ right of refusal must be exercised within a reasonable time, and in any event within the statutory two months[5]. As four months have now elapsed, if the directors have not taken a positive decision to refuse to register the transfer, they will have lost the right to do so[6], and Bill therefore has a right to be registered as a member. He should apply to the court to have the register rectified under section 359 CA 1985 and should serve a notice on Treeng for a share certificate to be issued as required by sections 185(1) and (5) and Schedule 24 CA 1985. There may be an obstacle for Bill if the directors of Treeng can show that they in fact decided to refuse to register the transfer within two months of the transfer form being lodged with the c ompany, and then simply failed to notify Bill of their decision. In Popley v Planarrive Ltd[7] Laddie J held that such default will make the relevant officers liable under section 183(6) CA 1985, but will not in itself affect the validity of the refusal. However, Laddie J went on to suggest that there may be circumstances in which the delay in notification is such that the company ought to be estopped from relying on its refusal to register[8]. In my view it is likely that even if the directors did decide to refuse to register the transfer within the prescribed two months, Bill may persuasively argue that the delay in notifying him is such[9] that the company ought to be estopped from relying on the decision and that the register ought to be rectified and the share certificate issued as discussed above. Question 2 As Henryà ¢Ã¢â€š ¬Ã¢â€ž ¢s signature on the transfer form is forged, the instrument is void and there is therefore no transfer of his shares[10]. This means that Henry has the right under section 359 CA 1985 to request that the company rectify its register of members by restoring his name in place of Malcolmà ¢Ã¢â€š ¬Ã¢â€ž ¢s. This will be the case even if there is evidence that Henryà ¢Ã¢â€š ¬Ã¢â€ž ¢s own conduct gave Bernard the opportunity to commit the fraud[11] (and indeed it appears that Henryà ¢Ã¢â€š ¬Ã¢â€ž ¢s carelessness gave Bernard the opportunity to steal the share certificate and then commit the fraud). This strict position will of course adversely affect Malcolm, who is likely to have paid Bernard for the shares. In addition, there will be little point in Malcolm seeking to pursue a claim against Bernard, as the latter has in all likelihood disappeared with the money. Malcolm will want to rely on the doctrine of estoppel by share certificate. The doctrine provides that where a company has issued a share certificate (which contains a statement that the transferor is the registered holder of the shares) and a transferee has subsequently relied on the certificate to his detriment as proof that the transferor did in fact own the shares, the transferee may claim an indemnity from the company if it later transpires that the share certificate was in fact false and that the transferor did not own the shares[12]. The company, on the other hand, may in turn claim an indemnity against the party who lodged the forged instrument which led to the issue of the false certificate, even if such party had no knowledge that the instrument was forged[13]. In the present scenario, a valid share certificate was issued by the company to Henry. There is no suggestion that Bernard fraudulently transferred the shares to himself and then requested a certificate in his own name to be issued before purportedly transferring the shares to Malcolm. Therefore, Malcolm will have relied on the valid share certificate as evidence that the shares were owned by Henry, and will then have acted on the erroneous assumption that Berna rd was in fact Henry. It follows that the doctrine of estoppel by share certificate will not assist Malcolm in these circumstances, as the certificate relied on by Malcolm was in fact a perfectly valid one. As Malcolm will not be able to seek an indemnity from the company, there will be no scope for the company to seek an indemnity from the party who lodged the forged instrument, although rather interestingly in these circumstances that party would be Malcolm himself, creating a rather odd circularity. Consequently, it appears that Henryà ¢Ã¢â€š ¬Ã¢â€ž ¢s name will be reinstated and Malcolm will have no remedy against Bernard or the company. Although this approach is somewhat harsh in relation to Malcolm, it appears that the rationale underlying it is that the transferees or their brokers are in a better position to asses whether the purported transferors are rogues than companies, who generally issue share certificates as a mere administrative procedure. The situation wou ld be different if Malcolm had meanwhile transferred his shares to Nadia, whose name now appeared in the register of members. Henry would again be able to insist on the reinstatement of his name in the register in place of Nadiaà ¢Ã¢â€š ¬Ã¢â€ž ¢s, but Nadia could argue that she had relied on the share certificate issued to Malcolm as evidence of Malcolmà ¢Ã¢â€š ¬Ã¢â€ž ¢s ownership of the shares. As such certificate is in fact false, Nadia would be able to seek compensation from the company, which in turn would be able to seek compensation from Malcolm who, though unknowingly, lodged the forged transfer form in the first place[14]. BIBLIOGRAPHY Barber, Company Law, 4th ed., London, Old Bailey Press, 2003 Davies, Gower and Daviesà ¢Ã¢â€š ¬Ã¢â€ž ¢ Principles of Modern Company Law, 7th ed., London, Sweet Maxwell, 2003 Mayson, French Ryan, Company Law, 23rd ed., Oxford University Press, 2006 Sealy, Cases and Materials in Company Law, 7th ed., London, LexisNexis UK, 20 01 Shepherd, Company Law: 150 Leading Cases, 3rd ed., London, Old Bailey Press, 2004 Hardoon v Belilios [1901] AC 118 Popley v Planarrive Ltd [1997] 1 BCLC 8 Re Hackney Pavilion Ltd [1924] 1 Ch 276 Re Smith and Fawcett Ltd [1942] Ch 304 Re Swaledale Cleaners Ltd [1968] 1 WLR 1710 Royal Bank of Scotland plc v Sandstone Properties Ltd [1998] 2 BCLC 429 Simms v Anglo-American Telegraph Co (1879) 5 QBD 188 Welch v Bank of England [1955] Ch 508 1 Footnotes [1] Re Smith and Fawcett Ltd [1942] Ch 304, per Lord Green MR at 306. [2] Re Hackney Pavilion Ltd [1924] 1 Ch 276. [3] This position will be changed when sections 771(1)(b) and (2) of the Companies Act 2006 come into force. [4] Hardoon v Belilios [1901] AC 118. [5] Re Swaledale Cleaners Ltd [1968] 1 WLR 1710. [6] Ibid. [7] [1997] 1 BCLC 8. [8] This point was not argued by either counsel in the case, and is therefore strictly obiter. [9] The delay will be of at least two months, as the decision must have been taken within two months from the lodging of the transfer: Re Swaledale Cleaners Ltd, cf. note 5 above. [10] Simms v Anglo-American Telegraph Co (1879) 5 QBD 188. [11] Welch v Bank of England [1955] Ch 508. [12] It should be noted that under section 186(1) CA 1985 a share certificate is merely à ¢Ã¢â€š ¬Ã…“prima facie evidenceà ¢Ã¢â€š ¬Ã‚  of a memberà ¢Ã¢â€š ¬Ã¢â€ž ¢s title to the shares. [13] Royal Bank of Scotland plc v Sandstone Prop erties Ltd [1998] 2 BCLC 429. [14] Ibid.

Catherine Barkly Man s Stepping Stone Of Achievement...

Catherine Barkly: man s stepping stone to achievement and fulfillment The Bechdel test, while usually applied to films, asks whether a work of fiction features at least two named, women characters who talk to each other about something other than a man. Works that pass the test are considered to have a rudimentary level of female agency and independence. Ernest Hemingway s hyper masculine novel, A Farewell to Arms, does not pass the Bechdel test. The novel, published in 1929, is set in Italy during World War I and centers around Lieutenant Frederic Henry, an American ambulance driver in the Italian army. Catherine Barkley is an English nurse and serves as Henry s love interest. Unlike Henry, she is a static character who does not†¦show more content†¦How many have you—how do you say it?—stayed with? None. You re lying to me. Yes. It s all right. Keep right on lying to me. That s what I want you to do. Were they pretty? (Hemingway 104-105) Initially, the relationship was a game of love with the sole purpose of distracting them from unpleasant circumstances. This passage demonstrates this game but also one of the illusions their entire relationship is built upon. Catherine and Henry are both acknowledging the lie. This dialogue establishes the importance of illusion in Catherine and Henry s relationship. By accepting the illusion, Catherine furthers her position as and idealization rather than a realistic character. Catherine s hair is a significant symbol in the novel. Henry s description of her hair in chapter XVII has become a well-known passage. He says, I would watch her while she kept very still and then take out the last two pins and it would all come down and she would drop her head and we would both be inside of it, and it was the feeling of inside a tent or behind a falls. (Hemingway 114). This description stands as a symbol of the couple s isolation from the world. Henry allows himself to believe that they ar e protected from the outside world by something as delicate as hair. In this description we are reminded of Catherine s alluring beauty as well as her innate ability to be exactly what Henry needs at any given point. By submitting to

Costs and Manufacturing Overhead Free Essays

1. How much overhead cost would be saved by outsourcing production of muffler-exhaust systems and oil pans if a. Overhead costs were entirely fixed costs? $0 would be saved because fixed costs do not affected by reduced number of labor caused by outsourcing. We will write a custom essay sample on Costs and Manufacturing Overhead or any similar topic only for you Order Now b. Overhead costs were entirely variable costs? (How is volume of activity measured at Bridgeton? Why is volume not measured by simply counting units produced?) All of them would be saved. If using numbers in 1988 for estimate, (5,766,000+6,532,000)*434% = $53,373,320 would be saved. Bridgeton accumulates all manufacturing overhead costs into one cost pool, and use direct labor dollar cost as the allocation measure to apportion the overhead costs in the cost pool. Unlike direct labor and direct material costs that can be traced to specific products, overhead costs could be administrative and manufacturing related so that not all of them are involved in ACF’s production. Therefore, there isn’t a high degree of correlation between the units produced and the amount of manufacturing overhead used. 2. How much overhead cost do you think Bridgeton and the consultants implicitly assumed would be saved by outsourcing muffler-exhaust systems and oil pans? They expect all overhead specific to product line of Muffler – Exhaust systems and oil pans would be saved, which is ($5,766,000+6,532,000)*434% = $533,733,20 (using 1988 data for estimate). 3. Calculate the overhead allocation rate for each of the model years 1988 through 1990. Are the changes since 1987 in overhead allocation rates significant? Why have these changes occurred? a) divide total overhead ($) by total direct labor ($) showed in Exh.2 to get overhead rate. | 1987| 1988| 1989| 1990| Overhead Rate| 437% = 107,954/24,682| 434% = 109,890/25,294| 577% = 78,157/13,537| 563% = 79,393/14,102| How to cite Costs and Manufacturing Overhead, Papers