A company may increase its capital by special resolution (sec. 52.) The memorandum, in the case of a limited company may, and in the case of an unlimited company must, be accompanied by articles of association. In the case of a limited company, where the memorandum is not accompanied by articles of association, the rules contained in Schedule 3 of Act 25, 1892, are ipso jure regarded as containing the articles of association of the company. The articles of association shall be printed, signed by each sub subscriber in the presence of and attested by one witness at the least, and shall, when registered, bind the company and all the members thereof (secs. 53-55). Share warrants may be issued by companies under regulations authorising them so to do. Such shares warrants must be registered. Stamp duties are payable on share warrants (secs. 63-72 ). Part III of the Act governs the distribution of capital and the liability of directors and members of companies and associations. Shares in a company must be capable of transfer, and must be numbered. Persons subscribing the memorandum are deemed to have agreed to become members, as are all other persons whose names are entered on the register of members. Every company must keep a register of members. An annual list of members, specifying their holdings, and particulars as to payment of calls, shares taken, shares forfeited, and persons who have ceased to be members, must be made, and a copy thereof sent to the Registrar. A company must notify consolidation or conversion of capital into stock. No trust, nor the name of any minor or insolvent, may be entered on the register. Notice of increase of capital and of members must be given to the Registrar. Where an improper entry, or an omission of entry in the register has occurred, the same may be rectified by an order of Court, of which order notice must be given to the Registrar (secs. 73-88). Directors, during their term of office, must possess the necessary qualification for office. Directors are made liable for false statements in a prospectus in the same way as directors subject to the English Companies' Acts are liable under the English Directors' Liability Act, 1890 (secs. 89-95). Past members of the company are, as a general rule, exempted from liability. Every share in a company in the absence of proof to the contrary, is deemed to be fully paid up (secs. 96, 97). Part IV of the Act refers to management and administration of companies and associations under the Act. Every company must have a registered office, notice of whose situation must be given to the Registrar. A limited company must publish its name outside its office, and in all notices, advertisements, and other official publications of the company, subject to a penalty of £50. Every limited company must keep a register of all mort gages and charges affecting its property. A list of the directors must be sent to the Registrar. A company, for default in keep ing a register of directors, or in sending a copy thereof or notifying changes therein to the Registrar, is liable to a penalty of £5 for every day of such default. No company may carry on business with less than seven members, and if this is done for a period of six months every person who remains a member of the company is severally liable to pay the whole of the debts of the company contracted during that time. The first general meeting of a company must be held, subject to penalty, within six months of registering the memorandum (secs. 98-107). A general meeting must be held at least once a year. Regulations of the company may be altered at general meetings by special resolution. Such special resolutions must be registered. Dividends to shareholders can only be paid out of profits. A company's affairs may be examined by company inspectors appointed by the Governor. An application to the Governor for inspection must be supported by evidence. The company may itself, by special resolution, appoint persons to inspect its affairs (secs. 108-121). Notices, documents, or orders to be served on the company are effectually served by leaving the same, or sending them through the post in a pre-paid letter addressed to the company, at its registered office. Part V of the Act relates to the winding up of companies and associations under the Act. Contributories are, in the first place, defined, and the nature of their liability established. In the case of death of a contributory, his personal heirs or representatives are held liable to the extent of the net amount of assets of the deceased which have come into their hands (secs. 131-134). The winding-up of a company by a Court may take place (1) Where a special resolution requiring winding up by the Court has been passed, (2) Where a company's business is not commenced within a year from incorporation, or is suspended for a whole year, (3) Where the members are reduced to less than 7 in number, (4) Where the company is unable to pay its debts, and (5) Whenever the Court is of opinion that it is just and equitable that the company shall be wound up. As to the last proviso, see Fairbridge v. South African News Co. (17 C.L.J. 66), where the Court refused to order liquidation, although the company's business was being carried on at a monthly loss of £600. Under Act 25, 1892, a company is deemed unable to pay its debts (1) When the company is without the consent of the judgment creditor unable to pay or give security for payment of a judgment against the company for 30 days after the giving of such judgment, order, or decree, (2) Whenever an execution in pursuance of a judgment against the company remains wholly or partly unsatisfied, or (3) When the Court finds it proved that the company is unable to pay its debts. An application for winding-up must be made by petition, presented by the company or by other interested parties. The petition may be objected to, and the Court decides finally upon the same. Actions and suits against the company must be stayed after the order for winding-up, but such actions may be prosecuted by leave of the Court. A copy of the winding-up order must be sent to the registrar. At any time the Court may stay proceedings, and in all matters the Court may have regard to the wishes of creditors or contributories. The winding up may be referred to the Master of the Court (secs. 135-145). The Court may appoint an official liquidator, or liquidators. Various powers, similar to those of a trustee in an insolvent estate, are given to the official liquidator, who may summon general meetings of creditors or contributories. He must, as soon as possible, submit a preliminary report to the Court, and the Court may upon such report, or any further reports, order a public examination of directors, officers, or promoters, to be held by any Judge or by the Master of the Supreme Court. The Court settles the list of contributories, and may require the delivery of any property belonging to the company for purposes of liquidation. The Court may order payment of debts by contributories, and may make calls on contributories. The Court may order that any debts due to the company be paid into a bank named by the Court. The Court may exclude creditors not proving within a certain time, may adjust the rights of contributories, and may finally dissolve the company, the order of dissolution being published in the Government Gazette and in newspapers named by the Court within 21 days of the order. The Court may also summon before it persons suspected of having property of the company, may examine parties, arrest contributories about to abscond or to remove or conceal any property, may appoint commissioners to take evidence, and may generally order anything to be done in the premises (secs. 146-177). Voluntary winding-up of a company may take place—(1) on effluxion of the period fixed for its existence or occurrence of the event after which dissolution was provided for by the articles, provided that a general meeting has passed a resolution to windup the company; (2) on the passing of a special resolution for winding-up; or (3) on the passing of an extraordinary resolution that it has been satisfactorily proved that the liabilities are too great for the company to continue business, and that it is advisable to wind it up. A voluntary winding-up is deemed to begin at the time when a resolution to that effect is passed. Notice of such voluntary winding-up must be given. A company may delegate to its creditors, or to a committee of creditors, the power to appoint liquidators. Arrangements with creditors are binding on the company if passed by extraordinary resolution, and on the creditors if acceded to by a majority in number and three-fourths in value of the creditors. The liquidators may call general meetings. The company in general meeting may fill up vacancies in the office of liquidators. The Court may also appoint liquidators. The liquidators, on the conclusion of the windingup, must make up an account and report to the Registrar. The Court may adopt all or any of the proceedings in the course of the voluntary winding up (secs. 178-194). The Act makes various supplemental provisions (secs. 195214), relating to a company's books, debts, undue preferences, and damages and criminal charges against delinquent directors and officers. Unregistered partnerships of more than seven persons may be wound-up under the Act, and similar rules apply as in the case of registered companies with regard to liquidation and contributories (Part VI, secs. 216-221). FEES PAYABLE UNDER “THE COMPANIES ACT, 1892.” For registration of a Company whose nominal capital does not exceed £2,000, a fee of For registration of a company whose nominal capital exceeds £2,000, the above fee of £2, with the following additional fees regulated according to the amount of nominal capital (that is to say): ... For every £1,000 of nominal Capital, or part of £1000, after after the first £5,000, up to £100,000, ... For every £1,000 of nominal capital or part of £1000, after the first £100,000 For registration of any increase of capital made after the of nominal capital, or registration or afterwards, any £ 200 100 050 010 τ FURTHER FEES PAYABLE UNDER THE COMPANIES ACT 1892. (Vide Government Notice No. 1154, 1892). ... ... For registration of an altered memorandum of Association For registration of any document or making a record of any For a copy or extract of any document or any part of a document: For the first 400 words or fraction thereof For each additional 100 words or fraction thereof NATAL. No attempt at codification of company law has as yet been made in Natal. The law on the subject is regulated by Law No. 10, 1864 (Registration of Companies), Law No. 18, 1865 (Amending Law No. 10, 1864), Law No. 19, 1893 (Share Liability), Act 3, 1896, Act 33, 1899 (Pledging of Shares), and Law No. 19, 1866 (Winding-up). A joint-stock company may be registered with limited liability on the following conditions: (1) The directors or provisional directors must in their application for registration state that the company is to be formed with limited liability; (2) The word "limited" must be the last word of the company's name; (3) The "deed of settlement must state the formation of the company with limited liability; (4) The deed must be executed by not less than 10 shareholders, holding shares amounting in all to not less than three-fourths of the nominal capital, and on such shares not less than £5 per cent. must have been paid up; (5) Payment of such percentage, with other particulars, must be acknowledged in the deed, and verified by affidavit of at least two directors (sec. 2). The other enactments with regard to registration are similar to those contained in the Cape and English Companies' Acts. Returns of transfers of shares must be duly made (secs. 3-9). The following fees are payable on registration:-For companies with a nominal capital of £5,000 or under, £10; companies with nominal capital of £5,000 to £20,000, £20; companies with nominal capital of over £20,000, £30 (sec. 10). |