to be formed on the principle of limited liability. By the repeal of these Acts the law on Joint Stock Companies is almost exclusively governed by the present law, which is divided into nine parts. The first part relates to the constitution and incorporation of companies and associations, which is entirely taken from the Act of 1856, giving also a schedule of regulations for the management of a company limited by shares; the second part relates to the distribution of capital and liability of members of companies and associations, also taken from the same Act; the third part refers to management and administration, giving power to companies to refer matters to arbitration in conformity with the Railway Companies Arbitration Act; the fourth part provides for the winding up of companies and associations, derived principally from the Act of 1856 and 1857, and partly from the Winding up Acts of 1848 and 1849; the fifth part gives the constitution of the registration office; the sixth part provides for the application of the Act of Companies registered under former Joint Stock Companies Acts; the seventh part describes the companies authorised to register under the Act; the eighth part provides for the application of the Act to unregistered companies; and the ninth part repeals the Act already described.

Prohibition

of partnerships exceed ing certain

No company, association, or partnership consisting of more than ten persons can be formed for the purpose of carrying on the business of banking, unless it is registered as a company number. under this Act, or is formed in pursuance of some other Act of Parliament, or of letters patent; and no company, association, or partnership consisting of more than twenty persons can be formed, after the commencement of this Act, for the purpose of carrying on any other business that has for its object the acquisition of gain by the company, association, or partnership, or by the individual members thereof, unless it is registered as a company under this Act, or is formed in pursuance of some other Act of parliament, or of letters patent, or is a company engaged in working mines within and subject to the jurisdiction of the stannaries (a).

(a) 25 & 26 Vict. c. 59, s. 4.

Mode of forming company.

Mode of limiting liability of

members.

Memorandum

of association

limited by shares.

PART I.

CONSTITUTION AND INCORPORATION OF COMPANIES AND

ASSOCIATIONS UNDER THIS ACT.

SECTION I.

MEMORANDUM OF ASSOCIATION.

Any seven or more persons associated for any lawful purpose may, by subscribing their names to a memorandum of association, and otherwise complying with the requisitions of this Act in respect of registration, form an incorporated company, with or without limited liability (a).

The liability of the members of a company formed under this Act may, according to the memorandum of association, be limited either to the amount, if any, unpaid on the shares respectively held by them, or to such amount as the members may respectively undertake by the memorandum of association to contribute to the assets of the company in the event of its being wound up.

Where a company is formed on the principle of having the of a company liability of its members limited to the amount unpaid on their shares, hereinafter referred to as a company limited by shares, the memorandum of association must contain the following things:-The name of the proposed company, with the addition of the word "limited" as the last word in such name (b); the part of the United Kingdom, whether England, Scotland, or Ireland, in which the registered office of the company is proposed to be situate; the objects for which the proposed company is to be established; a declaration that the liability of the members is limited; the amount of capital with which the company proposes to be registered divided into shares of a certain fixed amount. Subject to the following regulations :-That no subscriber shall take less than one share; and that each subscriber of the memorandum of association shall write opposite to his name the number of shares he takes.

Memorandum of association

Where a company is formed on the principle of having the

(a) By the 20 & 21 Vict. c. 49, s. 12, unrepealed, any number of persons not exceeding ten may carry on in partnership, the business of bank

ing.

(b) New Brunswick and Canada Railway and Land Company . Boore, 3 H. & N. 249.

limited by

guarantee.

liability of its members limited to such amount as the members of a company respectively undertake to contribute to the assets of the company in the event of the same being wound up, hereinafter referred to as a company limited by guarantee, the memorandum of association must contain the following things:-The name of the proposed company, with the addition of the word "limited" as the last word in such name; the part of the United Kingdom, whether England, Scotland, or Ireland, in which the registered office of the company is proposed to be situate; the object for which the proposed company is to be established; a declaration that each member undertakes to contribute to the assets of the company, in the event of the same being wound up, during the time that he is a member, or within one year afterwards, for payment of the debts and liabilities of the company contracted before the time at which he ceases to be a member, and of the costs, charges, and expenses of winding up the company, and for the adjustment of the right of the contributories amongst themselves, such amount as may be required, not exceeding a specified amount.

Where a company is formed on the principle of having no limit placed on the liability of its members, hereinafter referred to as an unlimited company, the memorandum of association must contain the following things :-The name of the proposed company; the part of the United Kingdom, whether England, Scotland, or Ireland, in which the registered office of the company is proposed to be situate; the objects for which the proposed company is to be established.

Memorandum

of association

of an unli

mited com

pany.

Stamp, sig; nature, and effect of

of association.

The memorandum of association must bear the same stamp as if it were a deed, and must be signed by each subscriber in the presence of, and be attested by, one witness at the least, memorandum and that attestation is a sufficient attestation in Scotland as well as in England and Ireland. When registered it binds the company and the members thereof to the same extent as if each member had subscribed his name and affixed his seal thereto, and there were in the memorandum contained, on the part of himself, his heirs, executors, and administrators, a covenant to observe all the conditions of such memorandum, subject to the provisions of this Act.

Any company limited by shares may so far modify the con- Power of ditions contained in its memorandum of association, if autho

certain com

alter memorandum of association.

Power of companies to change

name.

rised to do so by its regulations as originally framed, or as altered by special resolution in manner hereinafter mentioned, as to increase its capital, by the issue of new shares of such amount as it thinks expedient, or to consolidate and divide its capital into shares of larger amount than its existing shares, or to convert its paid-up shares into stock, but, save as aforesaid, and save as is hereinafter provided in the case of a change of name, no alteration can be made by any company in the conditions contained in its memorandum of association.

Any company under this Act, with the sanction of a special resolution of the company passed in manner hereinafter mentioned, and with the approval of the Board of Trade testified in writing under the hand of one of its secretaries or assistant secretaries, may change its name, and upon such change being made the registrar must enter the new name on the register in the place of the former name, and issue a certificate of incorporation altered to meet the circumstances of the case; but no such alteration of name shall affect any rights or obligations of the company, or render defective any legal proceedings instituted or to be instituted by or against the company, and any legal proceedings may be continued or commenced against the company by its new name that might have been continued or commenced against the company by its former name (a).

Regulations

to be prescribed by articles of association.

SECTION II.

ARTICLES OF ASSOCIATION.

The memorandum of association may, in the case of a company limited by shares, and must, in the case of a company limited by guarantee or unlimited, be accompanied, when registered, by articles of association signed by the subscribers to the memorandum of association, and prescribing such regulations for the company as the subscribers to the memorandum of association deem expedient. The articles are to be expressed in separate paragraphs, numbered arithmetically. They may adopt all or any of the provisions contained in the table marked A. in the first schedule of this Act. They must, in the case of a company, whether limited by guarantee or unlimited, that has a

(a) 25 & 26 Vict. c. 89, ss. 0-13.

capital divided into shares, state the amount of capital with which the company proposes to be registered; and in the case of a company, whether limited by guarantee or unlimited, that has not a capital divided into shares, state the number of members with which the company proposes to be registered, for the purpose of enabling the registrar to determine the fees payable on registration. In a company limited by guarantee or unlimited, and having a capital divided into shares, each subscriber must take one share at the least, and must write opposite to his name in the memorandum of association the number of shares he takes.

Table A.

In the case of a company limited by shares, if the memo- Application of randum of association is not accompanied by articles of association, or in so far as the articles do not exclude or modify the regulations contained in the table marked A. in the first schedule of this Act, the last-mentioned regulations shall, so far as the same are applicable, be deemed to be the regulations of the company in the same manner and to the same extent as if they had been inserted in articles of association, and the articles had been duly registered.

nature, and

articles of

association.

The articles of association must be printed, they must bear Stamp, sigthe same stamp as if they were contained in a deed, and must effect of be signed by each subscriber in the presence of, and be attested by, one witness at the least, and such attestation is a sufficient attestation in Scotland as well as in England and Ireland. When registered, they bind the company and the members thereof to the same extent as if each member had subscribed his name and affixed his seal thereto, and there were in such articles contained a covenant on the part of himself, his heirs executors, and administrators, to conform to all the regulations contained in such articles, subject to the provisions of this Act; and all monies payable by any member to the company, in pursuance of the conditions and regulations of the company, or any of such conditions or regulations, is deemed to be a debt due from such member to the company, and in England and Ireland to be in the nature of a specialty debt (u).

(a) 25 & 26 Vict. c. 89, ss. 14—16.