History of Co Law Flashcards
Can be used in essays about the formation of companies, whether SH own anything, and is a foundation for forming what rights SH should have.
What are Joint stock companies? (JSCs)
Woolridge: Limited liability JSC is a distinct legal entity endowed by government w certain collective rights & responsibilities
Company stock can be bought & sold by SHs.
JSC vs Ordinary Partnerships
each has a pro, liability limit, and a con.
JSCs can:
1) easily transfer shares to new people
2) only bound by invested stock
(cannot demand payment)
Ordinary P can:
1) demand withdrawal & payment for their share
2) bound by extent of fortune
(cannot transfer w/o partner approval)
What did the Company Act (CA) 1844 do?
1844:
1. >25 had to register for a JSC
2. incorporation by mere registration
3. full publicity
4. LL excluded (but liability cease after 3 years transfer)
5. established 3 types of commercial associations
What were the 3 types of commercial associations established in CA1884
- Private partnerships (unincorporated w unlimited liability)
- Chartered/statutory companies (normally liability-free/ liability limited to sum per share)
- Registered co under 1844 (unlimited liability)
What happened in 1855?
Limited liability bill passed
What act passed in 1856 & what was its effect?
JSC act 1856
• removed safeguards (Easier to incorporate & get LL)
• removed provisional registration
• deeds of settlement —> modern memorandum & articles of association
• ≥7 needed for memorandum
• safeguards of 1855 removed
Why was LL easier to get?
1845-48: Bank of Glasgow bust, Great Depression
What amendment occurred in 1862?
“formed themselves into a co” –> “forming a co”
[defining nature of shares] What case established that SH had no direct interest (legal/EQ) to company’s property, but only a right to dividends and to assign shares for value?
Bligh v Brent
• Not (retaining ownership w responsibility) more like (transferring ownership, ceding responsibility & liability for regular money payment & contractual rights)
[Defining nature of shares] what is “in the company” or “|in the market”, where are SH?
In the market.
In the Company (private) [committed rs]
• Indispensable to its functioning in manner prescribed by co legislation
• SH committed emotionally & financially
In the Market (public) [fuckboy]
• SH clearly inside, but not bound
• Doesn’t vote (due to small stake & little influence)
• Not sufficiently committed to co fortunes to litigate (prefer abandon)
Who claims that “no one owns public corporations” and what is his argument?
John Kay. Using Honore possession test and an umbrella comparison, established that no one owns public corporations.
How are shares valued? What potential problems are there?
- Share Value – profit expectations about future (speculations)
- Can be manipulated. [TESCO]
What were the CAs intended for?
Larger corporations with more SHs (arguably not one man companies)
