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affords no positive information, and be well qualified to write consolatory but evasive letters to shareholders who show anxiety about the company's business. Respectability and plausibility are the only other necessary abilities he needs to possess.

The duties of a MEMBER or SHAREHOLDER are comparatively light, being merely “ to supply the funds required for promotion money, purchase of the vendor's rights, and the wherewithal to support the directors and staff,” what remains being applicable to the other purposes for which the company exists. These disbursements come out of a general fund called the "capital of the company, the greater amount of which it was the shareholders' privilege to supply.

The ACCOUNTANT is a public official appointed yearly by the company, at a small salary, “ to examine the statement of assets and liabilities when prepared, compare them with the vouchers, and find them correct.” It is wrong to suppose that it is any part of his duty to dive into the intricacies and involvements of the company's transactions, and make himself responsible for the acts of the other officials in the business, his concern being mainly with what is laid before him.

WRECKERS we would rather not define, as they were not premeditated in the Act of Parliament, but have attached themselves to its operations as a kind of fungus growth. They may be best judged by their doings, and these are incidentally referred to at the end of the next chapter.

The LIQUIDATOR fills a thankless position, usually with more grace than agility. He is called in when the company has reached the closing stage of its career, and then supersedes the directors in the eye of the law, carrying on or settling affairs for the supposed benefit of the company's contributories. Sometimes there is not much left for him to settle, but he applies himself diligently to his duties, "makes the best of a bad job," and contrives that what little there is shall keep the concern running as long as possible.

It will be prudent to assume that most readers are acquainted with the remaining technical terms, especially where they are not words of recent introduction, as, although the significations of some have become somewhat obscured, others are comparatively unchanged : e.g., an ACT OF PARLIAMENT is simply an Act of the Legislature, and must be adhered to until repealed or amended, no matter though some individual members of the House of Commons may say, as they affirmed of the Metropolitan Railway Ventilation Act, that it was “smuggled through committee." Although Acts of Parliament do not always accomplish their purposes, whether in assisting or preventing certain desirable or undesirable objects, and vehicles are said, metaphorically, to be driven through them, it must be remembered that this was not the purpose for which they were originally framed. They are passed to compel adherence to a certain course ; but, owing to man's ingenuity, he often attempts to circumvent their intentions. The Joint-Stock Companies Acts are not exceptional in this respect, and whilst they assist in the promotion of sound undertakings, they also fail entirely to prevent, if they do not by the extreme ease of their adoption connive at, the starting of unsound ones.

Much confusion has arisen in the terms DEBTOR and CREDITOR. Now, however apparent at first sight, we are not always to consider a debtor as an ill-used individual, with serious grievances to be redressed, and the unfortunate victim of circumstances brought about by certain persons called creditors, who persecute him for the sole reason that they are better off than he is. Nor is it wise unreservedly to believe that the opprobrious epithet of creditor is always deserved by the harsh men and women who stand in that position to the debtor, although the workings of our Bankruptcy Laws show that of the two positions that of the debtor is not the least enviable, the term being an honourable one, and not necessarily implying that he is needy, nor is it derogatory to his social status. It will, perhaps, be more charitable to assume that our new Bankruptcy Laws will restore the terms to their original meanings.

Having now paved the way for the further consideration of our subject, let us see in the next chapter how the combined forces just defined are set to work, and what they succeed in producing.




“They have their exits and their entrances.”


HE initiatory steps in the formation of a company

are very easy of application; and in this respect the Acts have evidently proceeded on the assumption that

man is perfect," in which case it would have been unwise in the Legislature to allow any preliminary restrictions to prevent the "attainment of happiness" in whichever way it was thought to be best assured, especially if, in aiming at his own happiness, the promoter undertook to shower blessings on his fellow-mortals in the shape of handsome dividends at regular periods. The principal Act of 1862 is divided into nine parts, and in all of these, relating to the constitution and incorporation, registration, &c., of companies and associations, this charitable assumption prevails. It is not till we reach the sections which treat of winding up that we see foreshadowed, as it were, a doubt as to the infallibility of man. It is only fair, however, to assume that our legislators of that period did not foresee that this winding up should become the regular occurrence it has turned out to be, but only prescribed for it as an occasional calamity, to be provided against in case of need. Of course, with certain limitations, every man is allowed to interpret an Act of Parliament as he thinks proper ; but unfortunately many have only seen in these statutes an opportunity of defrauding their fellows, and have mistaken the permissive clauses relating to winding up as compulsory, to judge, at least, by their endeavours to reach this stage with such undue haste. Be this as it may, it is a disgrace to the whole system that, of all public companies registered, not one out of twenty settles down as a stable concern; many never reach the allotment stage; some allot their shares, but, for certain occult reasons, never commence business; fifty per cent. are fit to be wound up within a year of their formation, and the remainder drag a lingering existence for an indefinite time, without accomplishing anything save the expenditure of their capital.

Much weighty literature has been offered to the public to assist in the interpretation of the statutes, and it is from a study of some of these books, of the Acts themselves,

As a

should say:

and from Parliamentary returns, that you are now given some hints on how to set to work to start a joint-stock company. However, it must be understood that good and bad, companies with real and companies with imaginary objects have to observe the same rules; and, as under these regulations the means are the same, no matter how diverse the ends, every one must apply the description as his experience best suggests.

FIRST, then, it is necessary for seven or more persons, " associated for any lawful purpose,”—everything is lawful at this stage,-to meet, talk things over, and subscribe their names to what is called a MEMORANDUM OF ASSOCIATION. These persons form the nucleus of the capitalists who are presently to be attracted to join in the venture. matter of fact, however, these embryo members of the company are not, strictly speaking, CAPITALISTS, but more generally clerks to the solicitors or promoters of the company, and subscribe their names for one share each. This is the first stage of evasion we meet with in the application of the Act. The original intention was that seven persons

“We believe in the statements of this prospectus to such an extent that we subscribe to this company the sums set against our names.” The stipulation was to show the public at large who the promoters and directors were, and what their interest was in the undertaking ; but, by a legal fiction, the clause has been so interpreted, that only one share, as a rule, is set against each

This MEMORANDUM OF ASSOCIATION shows :1. The name of the company. 2. The situation of the registered office. 3. The objects for which the company is established. 4. The liability of its members.

5. The nominal capital and value of the shares into which it is divided.

As “the name of the companymust not be the same as that of any other in existence, great scope is given to wily imaginations to bring out something very striking. Generally it is found that common-place titles belong to bondfide companies, with tangible objects, whilst the highsounding names are monopolised by those which have little else to recommend them. The situation of the registered office," as in England, or Scotland, or Ireland, is easily settled. The actual office may commonly be found by consulting a name-plate in the neighbourhood where companies “ do most abound,” and there it will be discovered at the foot of a long list of similar concerns, sharing the temporary shelter afforded to it while in this


preliminary stage by the accommodating secretary of various other schemes. "A fellow-feeling makes these companies “wondrous kind.” Perhaps

Perhaps "the objects for which the company is established" is the most inviting portion of the memorandum. The field is a wide one, and a glance at a Post-office Directory or trade list will show you that these "objectscomprise everything we can know or think of, and very much also that is unthinkable and unknowable. There are agricultural purposes to be served, and so we have projects relating to the acquisition and working of lands, as cattle ranches, &c.; chambers, too, of commerce and of agriculture in all their branches, which, however, are not associations for profit. Human wants must be catered for, giving rise to aërated bread companies, tea and coffee taverns and companies, fish-supply associations, civil service and other co-operative stores ; and when those desires cease, there are joint-stock cemeteries, where we may peacefully rest from all our financial troubles. Colonisation associations are formed for the civilising of mankind; docks for our shipping; gas, electric light, and water companies for our houses, which themselves are thrown up wholesale by joint-stock building and freehold land societies. Then there are guarantee associations, and other assurances for yourself and all in whom you choose to take an interest; loan and trust companies, and mortgage associations ad infinitum ; telegraph and parcelsdelivery companies, manufacturing companies for everything you can imagine, and more. The wood pavement and asphalt we walk upon or slip over; the tramcars, busses, and railways that take us to and from our places of business, and steamships that ply on our rivers and seas,all are found room for in this category. Hotels and taverns

for shelter of man and beast”; breweries and distilleries for those of pronounced tastes, and milk, zoedone, and other manufactories for those who prefer less stimulating beverages. Nor are amusements forgotten : we had our skating-rinks, and have our aquariums and palaces. Mines also find an important place in the lists, situated, some of them, in such remote districts that their exact whereabouts are not always known. Rent guarantee societies exist, to which all should belong; and, as an instance of "wheels within wheels," we have joint-stock companies framed for starting other joint-stock companies. If anything fortunately remains over after investing in all these undertakings, there remain to be mentioned our banks, where the cash may be deposited, and the National Safe Deposit Company, who will take care of the securities. Nothing is

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